LONDON — It was an action-packed and graceful goodbye.
Domenico De Sole spent his final day at Gucci Group making sure his stores around the world had enough tennis shoes, in particular the ones with the crocodile details and the signature red-and-green stripe.
“They’ve sold out, and I’m agitated about the reorders and deliveries,” De Sole told WWD, just a few hours after the put by Pinault-Printemps-Redoute expired on Thursday afternoon. “There are two things I do well: get agitated and worry.”
And when there’s no more business to worry about? “I’ll go nuts, probably,” he said with a laugh.
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In a telephone interview from New York, a reflective De Sole lauded his former nemesis, LVMH Moët Hennessy Louis Vuitton chief Bernard Arnault; criticized his own decision to build up the Gucci portfolio so quickly, and admitted he’s looking forward to working with Tom Ford again one day.
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De Sole, who leaves for his home in South Carolina today, also talked about the legacy he and Ford have left behind, and his next moves.
“That’s the big question. What AM I going to do?” De Sole pondered. He denied those stubborn market rumors that he’s looking to take over Bally, Valentino or Versace. “At this point, I’m not interested in running anything — just my boat — and I’m actively rejecting any phone calls.”
That said, he’s headed back to Italy next week for his first meeting as a board member of Telecom Italia, the Italian telecommunications company.
And while he may be on his way out the door, he’s still talking that Gucci talk. “We had strong double-digit retail sales growth worldwide in February, March and April, and watch orders were up 40 percent at the Basel Fair,” he said.
In the month of April, retail sales growth at the Gucci brand was close to 20 percent. At Bottega Veneta, retail sales growth was 60 percent in the first quarter, while at Yves Saint Laurent and Sergio Rossi, sales growth was in the strong double-digits for the first quarter.
De Sole is famous for his workaholic habits (he hasn’t had a real day off in years) and obsession with the phone (he calls colleagues in the wee hours and on the weekends, with updates, ideas, and to-do lists). Now he is finding novel ways of channeling his energy.
“I’ve learned to use e-mail, and I’m going to send Tom messages every other day. I’m also going to spend my time boating, flying and doing the things I haven’t had time to do.”
De Sole — who made a $30 million profit in January from the exercise of Gucci stock options and will pocket more cash when he completes the sale of his remaining shares as part of the PPR put — has just bought a 43-foot sailboat, which gets delivered next year. He also plans to tool around in his 1986 metallic silver Porsche. “That car has been in mothballs for the past 10 years, and I finally got it fixed. And I’m driving it home from Charleston tomorrow.”
De Sole was generous — in more ways than one — about his decade at Gucci, which generated more drama, tears and sleepless nights than most managers see in a lifetime.
During his tenure, he battled a series of adversaries — Maurizio Gucci, Patrizio Bertelli and Bernard Arnault, to name a few. “Make my day” became his mantra the moment Arnault began his hostile takeover of Gucci in 1999. Clint Eastwood’s famous line also became De Sole’s philosophy, of sorts, when it came to running the business. Indeed, De Sole has always considered business to be war, one in which victories are measured in numbers.
“I think the legacy we left is twofold: We took care of our shareholders,” said De Sole. “Everybody who invested in Gucci made money — and that’s the goal and task of every manager. I feel like I can say ‘mission accomplished.’ And I think we gave the industry a new model: the balance between Tom and me, the creative and business side.”
He considers his greatest achievements to include the overall performance of the company and the repositioning of Yves Saint Laurent.
“I think it’s telling that PPR asked Mark Lee [ceo of YSL] to stay. And I do believe that Tom did a brilliant job at YSL. That company has long legs. It’s going to go far.”
Does he regret not seeing the turnaround at YSL, which is still in the red, through to the end? “It didn’t work out. That’s life. What are you going to do?”
He said, too, he’s proud of Gucci’s transparency with shareholders. “Listing the company was the right thing to do — I have no regrets about that. It gives the business a sense of urgency and it’s rewarding for both investors and managers. And I think we were real stars when it came to disclosure. We were very, very candid and transparent and I think we’ll be missed for that.”
De Sole never minced his words with shareholders. He was the first to sound the alarm of the 1997 Asian crisis, when most other managers had their heads buried in the sand. And, of course, he was famous for his colorful language. He sometimes referred to certain adversaries as “pathological liars.”
But there were missteps along the way, which De Sole acknowledged.
“Gucci went too quickly from one brand and one culture to a multibrand group. It would have been better had we made the acquisitions over a 10-year period. But it was very quick, and then we had Sept. 11, and other problems.
“In addition, in just a few months we went from producing clothing for Gucci to producing for Gucci, YSL, McQueen, and Balenciaga. The technical and operational aspects of building the brand portfolio were ferocious. We could have even used more time finding the management talent.”
Ironically, De Sole was one of the more cautious spenders during the luxury acquisition sprees of the late Nineties. He always said his goal wasn’t to spend money “like a drunken sailor,” and turned his back on the Fendi purchase in 1999 when the bidding spiraled out of control. Arnault and Prada chief Bertelli ended up paying close to $1 billion for the company — one of the highest multiples ever paid in the history of the luxury business.
Despite his regrets about the speed with which he built Gucci, De Sole sticks by the multibrand approach. “Having a single brand is great, but if it’s very successful, how can you keep it growing without going down market? I think the brands we acquired were great, I just wish we had had more time.”
Despite the battles he fought — most notably with Arnault, when the Frenchman attempted a hostile takeover of Gucci in 1999 — De Sole is using his exit from Gucci to put the past to rest.
“I think the battle with LVMH was good for the industry, it was good for the luxury brands, it created competition and conflict, it was exciting.”
And in a complete about-face, De Sole praised Arnault, a man he once accused of “trashy behavior” and likened to “glue” — and that was just on the record. But times have changed.
“I admire and respect Arnault’s time, patience and tenacity in turning around Christian Dior.”
Would he go so far as to sit down for a drink with the Frenchman who tried to take over his company, the man who once tried to drive a wedge between him and Ford and insisted De Sole was simply a PPR employee? “I would think about it. The past is past.”
In a similar magnanimous spirit, De Sole even offered up a thank you to Francois Pinault, his former white knight and the man ultimately responsible for not renewing the contracts of Ford and De Sole. “I am grateful to him for the extra five years at Gucci, and have a lot of respect for the company,” he said.
Looking back over the years, De Sole said his expectations for Gucci were never that grand.
“I was an insider from the beginning: I knew the immediate problems the company had, and I knew how to fix them. Back in 1993, Gucci had worldwide sales of $198 million, and I thought I could get them up to $350 million. Beyond that, I didn’t know. I also didn’t know the great job that Tom was going to do. I think we caught everybody by surprise — our model worked.”
The industry has changed, too. “There is money to be made now — 10 years ago it wasn’t like that. What was once considered an artistic business is now a place to invest, something that generates a profit.”
He said the great emerging market for luxury is China. “I was just there last month, and have been going to Beijing for the past 10 years. There is no doubt in my mind that the old luxury map will be redefined by China. It is going to be what Japan was in the Nineties. The Chinese are so aspirational and they love to travel.”
He said he’s upbeat about the future. “The industry has had two very difficult years, but that’s changing. I think to be successful in the long term, companies have to stick to their core values and be very careful about brand extensions.”
As for De Sole’s future, he said he’d love to do something with Ford, and in the meantime, said he plans to see his creative partner a lot. “We already know we’re getting together this summer, and of course, I’ll be in touch by e-mail.”
Another thing is for sure: If he has to leave a company again, he’s never going to repeat the Gucci experience.
“One thing I’ve learned is that once you decide to go, you should do it as fast as you can. Six months was too long. It was a long goodbye.”