Making Italian fashion global: Brand building and management at Gruppo Finanziario Tessile (1950s‒1990s)

Abstract

This paper deals with the role of brands in the emergence of the Italian fashion business. Starting from the mid-1950s, the main Italian clothing manufacturer Gruppo Finanziario Tessile (GFT) managed brands to build a domestic market for mass-produced clothing. In the 1970s increasing competition and changing consumption patterns pushed GFT towards partnerships with leading fashion designers for building new brands and entering international markets. The emergence of strong designers’ brands determined major organisational challenges that resulted in opposite outcomes: the demise of GFT, which failed in its attempt to control the entire value chain, and designers’ achievement of an international standing in the fashion industry thanks to improved brand management capabilities.

Keywords:

• Corporate strategy
• marketing
• resource-based theory
• brand management
• ready-to-wear fashion
• Italy
• Biki
• Giorgio Armani
• Ungaro
• Valentino Garavani
• Marco Rivetti

Acknowledgements

The authors wish to thank the anonymous referees for their useful comments and Catia Brilli for translation revision. All errors and omissions are ours. The article represents a joint effort. Elisabetta Merlo wrote the introduction and sections 2 and 3, Mario Perugini wrote sections 4 and 5 and the conclusion.

Notes

1. Penrose, The Theory, 24.

2. Barney, “Firm Resources”; Peteraf, “The Cornerstones”; Wernerfelt, “A Resource Based.”

3. Conner, “A Historical Comparison”; Dierickx and Cool, “Asset Stock”; Grant, “Prospering.”

4. Runyan and Huddleston, “Getting Customers.”

5. Barney, “Firm Resources.”

6. Hall, “A Framework.”

7. Wilkins, “The Neglected Intangible Asset.”

8. Higgins, “Forgotten Heroes and Forgotten Issues”; Mercer, “A Mark of Distinction”; McKendrick, Brewer, and Plumb, The Birth.

9. Da Silva Lopes and Casson, “Brand Protection”; Dahlén, “Copy or Copyright.”

10. Da Silva Lopes, “The Growth and Survival”; Da Silva Lopes and Duguid, Trademarks, Brands and Competitiveness; Da Silva Lopes and Guimaraes, “Trademarks and British Dominance”; Duguid, “Developing the Brand”; Jones and Morgan, Adding Value; Sáiz and Fernández, “Catalonian Trademarks.”

11. Vergani, Fashion Dictionary, ad vocem.

12. Merlo, “Italian Fashion.”

13. Patsiaouras and Fitchett, “The Evolution of Conspicuous Consumption.”

14. Djelic and Ainamo, “The Coevolution.”

15. OECD, Textile and Clothing Industries.

16. Breward, Fashion.

17. Merlo, Moda italiana.

18. Ente Nazionale Della Moda, Congresso Nazionale Abbigliamento e Autarchia.

19. Paulicelli, Fashion Under Fascism; Lupano and Vaccari, Una giornata moderna.

20. Rosso, “Lo sviluppo della confezione maschile.”

21. ISTAT, Censimenti ed indagini.

22. Doxa, Il consumo di prodotti tessili.

23. Caccia and Micheletto, Gruppo Finanziario Tessile, 7.

24. Merlo, “Size Revolution.”

25. Abruzzese and Aimone, FACIS SIDI CORI.

26. Rivetti, “La struttura organizzativa,” 3.

27. Lisiani, “Efficacia dei marchi,” 10.

28. Abruzzese and Aimone, FACIS SIDI CORI, 48.

29. AsTo (Archivio di Stato, Torino), GFT, box 1671, Profit and loss account 1955; box 1693, Profit and loss account 1960.

30. AsTo, GFT, box 1717, Profit and loss account 1965.

31. AsTo, GFT, box 2732, booklet “Confezione pronta ‒ Istruzioni per prendere le misure,” 1958, and box 2733, IRIS (Istituto Ricerche Statistiche), “Misurazione della popolazione femminile italiana,” Turin, 1957.

32. Olivari Binaghi, “La moda”; Blignaut, La scala di vetro; Boneschi, “Le sarte milanesi.”

33. Another example of partnership between a famous couturière, Madeleine Vionnet, and a mass-market manufacturer, the leading Parisian department store Galeries Lafayette, is described in Brachet Champsaur, Madeleine Vionnet.

34. AsTo, GFT, box 2127, Typescript, June 1957.

35. AsTo, GFT, box 2127, Letter sent by Biki to Silvio Rivetti, June 26, 1957.

36. AsTo, GFT, box 2127, Letter sent by Silvio Rivetti to Biki, September 17, 1957.

37. AsTo, GFT, box 2127, Payment mandates issued by GFT, 1957–1959.

38. AsTo, GFT, box 2127, Private deed, August 31, 1960.

39. AsTo, GFT, box 2127, “Partnership Biki/GFT,” Minutes of the meeting held in Biki’s atelier, December 14, 1961.

40. Evidence of GFT’s commercial proposal and of the subsequent negotiation can be found in detailed correspondence between Biki and Franco Rivetti, preserved in AsTo, GFT, box 2127.

41. AsTo, GFT, box 2127, Private deed, November 20, 1962.

42. AsTo, GFT, box 2127, Letter sent by Biki to Franco Rivetti, March 26, 1965.

43. AsTo, GFT, box 2142, Private deed, January 24, 1966.

44. AsTo, GFT, box 2142, Licensing agreement, Notarial deed, January 24, 1966, notary Ugo Gancia, file number (repertorio) 43735. As a trademark licensing agreement, it was also registered at the Italian Trademark and Patent Office, Registration act no. 7378, March 10, 1966. Biki had registered her trademark at the beginning of 1966 as found in the Central State Archives, Trademark and Patent Office, Registration act no. 178838, January 18, 1966. In June 1966, she also registered the same trademark at the French Trademark and Patent Office, Registration act no. 315,720.

45. AsTo, GFT, box 2142, Letter sent by Biki to Franco Rivetti, November 29, 1972.

46. AsTo, GFT, box 2142, Dossier ‘Biki’ containing newspaper advertising about Lanerossi, Fenicia, and Stellina – Marie d’Arc.

47. AsTo, GFT, box 2142, Letter sent by Biki to Franco Rivetti, July 24, 1971, and letters sent by Biki’s lawyer Corso Bovio to GFT’s house counsel Alberto Ugona, March 12, 1972 and May 12, 1972.

48. AsTo, GFT, box 2892.

49. AsTo, GFT, box 2127, Biki collections, Revenues summary chart. Figures concern the Autumn/Winter collections 1963/64, 1964/65, and 1965/66. The number of items sold is equal, respectively, to 6963, 5418, and 3514, corresponding to revenues amounting to 165, 135, and 86 million lire. As far as the Spring/Summer collections are concerned, available data refer to 1964 and 1965. The number of items sold decreased from 10,340 to 4534 and the revenues from 10,340 to 4534 million lire.

50. AsTo GFT, box 2606, Fatture Biki.

51. AsTo, GFT, box 3321, Ugona, A., “L’esperienza del gruppo GFT nel campo della griffe e della proprietà industriale,” speech of GFT’s house counsel Alberto Ugona at the meeting “Griffe, marchi e brevetti europei alla vigilia del 1992.”

52. Abruzzese and Golzio Aimone, FACIS SIDI CORI.

53. Mendes and de la Haye, Twentieth Century Fashion, 220–223.

54. Bourdieau, Distinction; Macchion, Fornasiero, and Vinelli, “Supply Chain Configurations.”

55. Significantly, at the same time, the formal outfit that the running man tucked under his arm in the FACIS trademark was replaced by the acronym itself, thus signalling that in GFT’s history the time of ready-made, mass-produced dress was over.

56. AsTo, GFT, box 2238, “Riflessioni sul rapporto tra la produzione industriale del GFT e gli stilisti” (1989).

57. Mendes and de la Haye, Twentieth Century Fashion, 167.

58. AsTo, GFT, box 2463, 1.

59. Carrarini, “La stampa di moda.”

60. Cox and Mowatt, “Vogue in Britain,” 74.

61. In 1957 Armani worked at La Rinascente, the largest Italian department store in Italy at the time. He then joined the staff of Cerruti, one of the biggest Italian firms producing men’s clothing, as a designer. With the encouragement of his friend Sergio Galeotti, Armani started to collaborate as a freelance designer with other companies as well. Armani and Galeotti became business partners in July 1975, when they founded Giorgio Armani Spa. The company’s first collection – a men’s clothing line – debuted that year. A year later, Armani launched a women’s collection, which received a warm reception. Since 1976, Armani’s collections have been included among the foreign luxury commodities sold by Barneys New York department store. See White, Giorgio Armani.

62. After studying in Paris and working as an apprentice for Jean Dessès and Guy Laroche, Valentino established his atelier in Rome in 1959. Throughout the 1960s and 1970s, his glamorous, sophisticated designs attracted high-profile customers such as Jacqueline Onassis, Elizabeth Taylor, and the Empress of Iran, Farah Diba. In 1969, he opened his first ready-to-wear boutique and introduced the ‘V’ logo. Valentino’s emblem owed much of its initial success to American customers, who especially appreciated his soft tailoring and lavish evening gowns. See Mendes and de la Haye, Twentieth Century Fashion, 204.

63. Potvin, Giorgio Armani, 85.

64. Giacomoni, The Italian Look Reflected, 9.

65. Potvin, Giorgio Armani, 284.

66. Among others, the cover of Time featured Claire Mc Cardell in 1955, Christian Dior in 1957, Rudi Gernreich in 1967, and Gianni Versace in 1995.

67. Potvin, Giorgio Armani, 85.

68. Howard, “The Designer Organisation.”

69. Locke, “Unity in Diversity”; Locke and Antonelli, “International Competitiveness.”

70. AsTo, GFT, box 1583, Agreement between Valentino Couture and Gruppo Finanziario Tessile Spa, October 5, 1979.

71. AsTo, GFT, box 2283, GFT Group Corporate Communications and Image. International Policies and Corporate Image; AsTo, GFT, box 2276, “Studi per la promozione del marchio GFT.”

72. Potvin, “Giorgio Armani,” 85.

73. AsTo, GFT, box 2238, “Riflessioni sul rapporto tra la produzione industriale del GFT e gli stilisti” (1989); AsTo, GFT, box 2283, Strategic Plan, GFT USA, February 1992.

74. Valentino’s labels licensed to GFT included: Valentino Boutique, Valentino Night, Valentino Miss V, Valentino Studio, and Valentino Carisma for womenswear; Valentino Uomo, Valentino Beachwear, and Valentino Couture for menswear.

75. Armani’s labels licensed to GFT included: Giorgio Armani, Giorgio Armani Le Collezioni, Mani (Canada and USA), and Emporio Armani for menswear; and Mani (Europe) for womenswear.

76. Ungaro’s labels licensed to GFT included: Ungaro Parallèle, Ungaro Solo Donna, Ungaro Ter for womenswear; and Ungaro Uomo for menswear.

77. Merlo, “Italian Fashion,” 351.

78. Stielau, “Competitive Strategy.”

79. Women’s Wear Daily, May 1, 1990.

80. Howard, “The Designer Organisation.”

81. Quotation from Marco Rivetti in Women’s Wear Daily, June 11, 1991.

82. Quotation from Marco Rivetti in Women’s Wear Daily, May 1, 1990. See also Potvin, “Giorgio Armani,” 92.

83. Quotation from Marco Rivetti in Howard, “The Designer Organisation.”

84. AsTo, GFT, box 2276, “Studi per la promozione del marchio GFT.”

85. AsTo, GFT, box 2276, GFT in North America.

86. Potvin, “Giorgio Armani,” 90.

87. Women’s Wear Daily, May 1, 1990.

88. Women’s Wear Daily, October 10, 1991.

89. Women’s Wear Daily, August 8, 1994.

90. Djelic and Ainamo, “The Coevolution,” 632.

91. Ingram, “Giorgio Armani S.p.A.”

92. Potvin, Giorgio Armani, 106.

93. Potvin, Giorgio Armani, 103–109; Merlo, “Italian Fashion,” 352.

94. Casson, “Brands.”

95. Bowman and Collier, “A Contingency Approach.”

96. Grant, “The Resource-Based Theory,” 115.

97. Macchion, Fornasiero, and Vinelli, “Supply Chain Configurations.”

98. Barney and Hesterly, Strategic Management, 94.

99. Barney and Clark, Resource-based Theory.

100. Djelic and Ainamo, “The Coevolution.”