Alber Elbaz’s Exit From Lanvin Adds to Upheaval in Fashion Industry

The shows must go on.

But after three surprise exits recently by fashion designers from some of the most powerful brands in the luxury industry, the question arises: Is this upheaval bad for business, or is bad business behind the turmoil?

On Wednesday, Alber Elbaz, creative director of the French fashion house Lanvin, announced he had been fired. Six days earlier, Raf Simons announced he was leaving Christian Dior. And only a few weeks ago, Alexander Wang had his final show for Balenciaga, before heading off to focus on his own brand.

It is probably too early to judge the financial fallout from these departures, and each case has its own particulars. But analysts are wondering if the brand loyalty that might help prompt someone to pay $10,000 for a Lanvin gown or $2,500 for a Balenciaga bag is damaged when the creator walks out — or is pushed.

Thomas Chauvet, a luxury analyst at Citigroup, says an answer lies partly in a shifting dynamic between the boardroom and the design studio, and the longstanding partnership model between the two that has traditionally underpinned the business.

“The times of star designers are long gone — we know they come and go and are possibly less loyal to the fashion houses than in the past,” he said.

“What matters most now is the brand name and DNA,” Mr. Chauvet continued. “The role of the designer is to interpret and support the brand’s heritage in a contemporary and commercially successful way.”

In the case of Mr. Elbaz, growth at Lanvin had begun to falter in recent seasons, after nearly a decade of strengthening sales and efforts at international expansion under his creative direction.

“Today the house of Lanvin ended its collaboration with Alber Elbaz,” the privately owned group announced from Paris late Wednesday, merely confirming the flood of rumors on Twitter. “We would like to thank him for the chapter he has written in our 125 year history,” Lanvin said.

Earlier in the day, Mr. Elbaz, the Israeli designer who owns a 10 percent stake in the company, had scooped his employer with his own public statement. He said his abrupt departure after 14 years at the oldest surviving French fashion house had been “the decision of the company’s majority shareholder,” Shaw-Lan Wang, a publishing magnate from Taiwan, who was among those who bought Lanvin from L’Oréal in 2001.

“I wish the house the future it deserves among the best French luxury brands, and hope that it finds the business vision it needs to engage in the right way forward,” Mr. Elbaz said in his statement, hinting at internal discord at Lanvin over how to navigate an increasingly competitive marketplace.

Last year, Lanvin had estimated revenue of about $321 million, but according to people close to the group who were not authorized to speak publicly, that figure is expected to fall this year to around $221 million. Lanvin’s wholesale partners, which account for 70 percent of sales of the brand, had apparently been hit hard by flagging Asian enthusiasm for luxury goods, currency headwinds and geopolitical instability that have plagued much of the fashion industry.

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“It is crucial that management of a brand adjust the business model to the growth needs of the company as it evolves, especially when it comes to the balance between wholesale and retail — and that did not happen at Lanvin,” said Ralph Toledano, president of the French fashion industry association with the ornate name of Fédération Française de la Couture du Prêt-à-Porter des Couturiers et des Créateurs de Mode. Mr. Toledano took Mr. Elbaz to Paris as the designer of Guy Laroche in 1996. (Mr. Toledano was Laroche’s chief executive at the time.)

Mr. Toledano was referring to what he said he believed was a lack of support on the corporate side of the fashion house. “It requires real investment, and understanding of the positioning, which in this case is that of a very, very special maison,” he said.

The surging production demands placed on 21st-century designers by luxury-brand executives looking for greater sales growth are immense. The intensity of the workload has been widely cited as a factor in all three of the recent designer-auteur exits.

Mr. Simons’s collections appeared to perform well in the market. For the fiscal year that ended June 30, revenue at Christian Dior Couture was up 18 percent, to €1.77 billion.

But at Balenciaga, the sluggish sales of Mr. Wang’s designs were rumored, but never confirmed, as being part of the reason he and the parent company, Kering, agreed in late July that he would leave.

Given that none of the owners of the three brands in question break out the profits or losses of the individual businesses in their luxury portfolios, it is hard to measure the contribution of a designer’s vision to the bottom line.

The turnover has not gone unnoticed by retailers and buyers in the industry, even if some of them see no cause for panic.

“There has been considerable reshuffling over the past few seasons, but to us it feels like part of a natural cycle rather than volatility,” said Natalie Kingham, buying director at the British luxury e-commerce group

“The strength in the way we buy is that we can be fluid and adapt with a change in creative direction,” Ms. Kingham said. “Our role is to work with the designer to understand their new brand vision and communicate it across all our platforms so a brand can continue to engage and excite the customer.”

But another retailer who spoke only on the condition of anonymity because she sells many of the brands involved was less assured. “Why do people covet Chanel or Comme des Garçons? The brands send a consistent message about what they are and what they stand for,” she said. “If you are going to invest, you invest in that. Even if you don’t like a collection or a season, you can’t deny the purity of the message. All these changes means fashion doesn’t feel pure any more. What do you say to the women?”

Mr. Chauvet of Citigroup added that there were inevitable risks around the considerable investments made by a parent group to a brand when a designer leaves.

“There can be some business disruption, particularly between the moment of the departure of a designer and the arrival of a new one,” he said. “You will usually have to clear some of the old collection’s inventories and might suffer from a lack of novelty until the new designer launches his first collection, which can disrupt sales for six to 12 months.”

While Mr. Elbaz held his position at Lanvin for 14 years — long enough to ride out various fluctuations in its fortunes — Mr. Simons and Mr. Wang lasted just three years at their posts. The two had only a fleeting time to imprint their own distinct visions on the fashion houses.

Different as the circumstances might be, the three departures in such a short time might indicate that now more than ever, it is the business managers who determine how fashion is created — and by whom.

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