I just read an article titled the Tragic Decline of the House of Versace by Dana Thomas in Newsweek, that predicts that Donatella could be forced out some time in the future if revenues don't change. The menswear show at Teatro Versace in Milan last June was just sad, no celebrities at the show, few editors and no excitement. That news is coupled with Nieman Marcus and Saks dropping the label. Inside sources at Versace say, "the industry has changed and they have not responded to the change". Donatella's drug addiction and the companies massive debt coupled with the extravagent spending have contributed to the downfall.
In the late nineties private fashion houses sold to large conglomerates like LVMH, these houses became well run business. Versace has stayed privately owned and have not followed the trend of others. When Gianni died in 1997 the House was valued a 1 billion, in 2007 the company was valued at 400 million. Donatella has sold off the Versace mansion in Miami and the estate in lake Como, to help offset the debt.
This is sad news, but I think it is time for Donatella to step down. Versace is not connecting with consumers in a way that it once was before. I remember at time when all the starlets on the red carpet where wearing Versace, but now it is a rare occurrence. Gianni modeled the clothes after "Italian Prostitutes" with loads of flash. The brand in my mind is marketed to Guido Italians and Euro trash types, not a good thing. Though fashion editors thought it was tacky, Versace sold in an age of excess. The economy has changed and fashion has changed, unfortunately Versace has stayed the same.
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