Weeks after joining Gucci as deputy chief executive in May, Stefano Cantino rubbed shoulders with stars and owner Kering’s top brass as the Italian brand took over London’s Tate Modern to stage its lavish runway show.
But the spectacle and huge after-party — where Kering executives mingled with guests and supermodel Kate Moss draped herself over Mark Ronson’s DJ booth — barely masked the difficulties ailing Gucci is facing.
When Kering this week announced its decision to promote Cantino to chief executive of the French luxury conglomerate’s biggest brand and profit centre, they were counting on his five-year stint at LVMH’s Louis Vuitton and two decades at Prada to lead the Florentine house out of decline.
It is a tall order. Cantino is now charged with executing the biggest and most complex turnaround in the sector at a time when global appetite for high-priced handbags and fashion is ebbing and growth engine China is faltering.
“Stefano Cantino becoming chief executive doesn’t surprise me, this was the plan from day one,” said Thomas Chauvet at Citigroup, although he added that the degree of downturn in the market and pressure on Gucci may have increased the urgency.
“I don’t expect a revolution . . . He will have to work on making sure what has been done in the past 18 months” under predecessor Jean-François Palus “materialises into numbers”.
Gucci is in urgent need of revival.
Kering this year issued several profit warnings, a rarity among big luxury groups, because of cratering sales at the brand, and has alerted investors that it expects group operating income in the second half of this year to be 30 per cent lower than the same period in 2023.
Barclays expects Gucci sales to be down 23 per cent in the third quarter against a year earlier.
Born in Turin, Cantino studied political science at the city’s university before joining Prada. During two decades at the luxury group, where he rose to lead communications and marketing, he worked closely with Francesca Bellettini, now deputy CEO of Kering.
They stayed in touch after he left in 2018 to join Louis Vuitton, which at the time was undergoing rapid growth under chief executive Michael Burke, becoming the first luxury brand to crack €20bn in annual sales.
The 57-year-old takes the lead at Gucci at a time of flux, with new designer Sabato de Sarno less than two years and six collections into the role following the departure of former star designer Alessandro Michele.
Cantino replaces Jean-François Palus, a three-decade Kering veteran who was appointed interim Gucci CEO in July 2023 and is a close associate of group chief executive François-Henri Pinault.
While that interim role was made permanent in February, people with knowledge of the situation said the plan was always to have a fairly rapid transition.
Palus’s goals were “to assess the Gucci situation, bring efficiency and search for the CEO . . . We identified Stefano very fast,” said one person close to Kering.
Cantino “combines together exactly what we need at Gucci, because Gucci is a company with two souls: the soul of heritage and the soul of fashion”, the person added. “Having been at Prada and Louis Vuitton, he combines both — that double experience is very precious to us.”
Since arriving at Gucci, Cantino — who is described as direct, exacting and analytical by people who have worked with him but also as charming and well-connected in the fashion world — has been working closely with De Sarno, including on the brand’s splashy new campaign featuring rock star Debbie Harry of Blondie while working with the Gucci teams on improving product lines and mix.
In addition to contending with a slowing global luxury market, Gucci is also working to reimagine its aesthetic and image several years after Michele’s maximalist vision — which catapulted the brand to huge success for some time — stopped selling well.
Kering hopes that De Sarno’s sleeker, more pared down style will help it achieve its strategy of elevating the brand and making it more timeless so it will be less vulnerable to trend cycles. But it is still not clear whether Gucci’s customers will buy in.
While Cantino’s background centred on image and communications strategy might raise some concerns about his experience with operations, people close to Kering say he has the skills they need.
At Prada, he worked not only on brand positioning — a key challenge facing Gucci — and communications but also on strategy and acquisitions, including its 1999 deal to buy British shoemaker Church’s.
Within Kering, executives watched closely as their rival Louis Vuitton appointed the late visionary streetwear designer Virgil Abloh, then musician and producer Pharrell Williams to design menswear, providing big boosts to the brands and widening its audience during Cantino’s time there.
At Vuitton, “in terms of product architecture, he did a lot”, said the person close to Kering. “The turnaround [at Gucci] is not only about taking a listed company and turning it around, but it’s also turning around big areas within big organisations. This is where he is really good.”
This is not the first time Kering has had to reinvent Gucci, but the brand still has a long way to go.
“Changing brand perception through reduction of outlets [and] brand elevation does take time,” analysts at Barclays wrote, but “we think that Gucci’s recovery story could be delayed . . . Current expectations could be too ambitious, and [we] see risks of further earnings cuts.”
With Cantino set to take charge in January, “the full casting is now in place,” said Chauvet at Citi. “Now it’s all about execution.”