Can celebrities ”save” CAVALLI ?

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In VANITY FAIR’s September 2009 issue Robert Cavalli poses more defiant than ever to the current economic crisis, without mentioning the deep financial troubles of the Italian brand. This year’s openings, especially the 7 storey Cavalli department store in Paris and the Cavalli Club in Dubai could not have come at a worse time, considering the annoucement early August that the deal struck in June with an investment fund to sell 30% of shares was eventually cancelled.
Instead, Mr Cavalli speaks about his celebrity friends such as Sharon Stone, Lenny Cravitz, Naomi Campbell, to name just a few, who constantly hang out at his parties and spread the spirit of the Cavalli brand. He poses in his custom made helicopter and Ferrari cars, while showing off his grand estate in Tuscany where he entertains his guests.
But can all these celebrity associations and all this PR keep the CAVALLI brand going ? A brand which has been mostly known for its flashy designs and leoppard prints seems to be out of demand with sales dropping by more than 50% in the first 6 months of 2009. Mr Cavalli says he is now working more closely with his stores (101 worldwide) to better understand his customers.
Since the debut of the current economic crisis, most top international luxury brands have shifted their strategies to draw back on their heritage, producing less but at higher quality and paying attention to their pricing. In the case of Cavalli, its heritage is not so obvious, the brand never being associated with quality or the craftsmanship of Made in Italy. Moreover, its diffusion line produced and sold by ITTIERE Group has been constantly losing its creative direction, most of the products being made in Asia, in many instances compromising on quality. No wonder, fellow Italian fashion brand Dolce Gabbana decided to cancel its agreement with ITTIERRE for the licencing of its second line D&G. In the case of Cavalli, even if the JUST CABALLI line licenced to Ittierre has produced good financial results throughout the years, it has also created a long term damage especially from a commercial point of view. The Ittierre sales network has long been out of control, with a huge number of sales points selling fake products mixed with old stocks, yet displaying same brands.
Unless Mr Cavalli realizes the immediate need to reposition the brand and reshuffle both the creative strategy and the product lines, the future for the Italian fashion house looks gloomy. The bubbling years of pre-crisis period are gone and there is very little likelihood they will ever come back. Therefore, we are not likely to witness the success Cavalli has enjoyed in the past decades especially in Russia, Ukraine and United States. Luxury consumers are more and more looking at subdued, more classical designs, putting high value on the quality of manufacturing and the quality of raw materials.