The Fashion industry has been in a bit of chaos lately after the news broke that Michael Kors would be acquiring the world-renowned Italian fashion house Versace for $2.1 Billion. However, this isn’t the first time the former Project-Runway judge has acquired a well-known luxury brand. In 2017, Kors bought the well-known luxury shoe brand Jimmy Choo for $1.2 billion.
In the fashion world, it’s not uncommon for companies to buy other brands, in 2017 Coach (now Tapestry inc.) bought Kate Spade for $2.4 billion. To be clear, Michael Kors himself did not buy Versace, his company did. The Michael Kors Holdings, which is under the leadership of John D Idol, has seen through these purchases of the luxury brands. Michael Kors Holdings will be undergoing a re-brand and be renamed to Capri Holdings. This is common to last years rebrand of Coach Inc to Tapestry Inc.
Even with the re-brand by Kors, the addition of Versace to the company is still strange considering the style differences of the Michael Kors and Versace brand.
While Kors is more ready to wear, Versace is more luxury. Since Michael Kors is “more accessible” than it’s high luxury counterparts, including Versace. At the end of the day, Versace is Haute Couture and Michael Kors is not. It was only last year that Kors saw large sales plummets which resulted in it closing 125 stores, this was measured several months after Jimmy Choo was purchased. This brings me to the biggest question: Can Michael Kors keep up with the costs and desire of such a large and notable brand as Versace? I guess we’ll have to see.
Oh, and the Michael Kors/Versace purchase is ALREADY getting the meme treatment because…the internet.
Michael Kors having acquired Jimmy Choo + Versace: pic.twitter.com/jS54eqlMrh
— Shelby Ivey Christie (@bronze_bombSHEL) September 25, 2018
But there isn’t a need to worry too much, Donatella will stay on as creative director and Versace’s chief executive Jonathan Akeroyd will as well. Hopefully, this means Gianni’s legacy will always live on.
Versace has since released a statement via Donatella Versace in light of the Internet’s backlash, reassuring that Versace will continue to be made in Italy and that Donatella is “NOT going anywhere”:
#DonatellaVersace has a message for you…
Photo by @RAHIREZVANI pic.twitter.com/iV3UdrXmT4— VERSACE (@Versace) September 27, 2018
While I still think it’s a strange purchase for Michael Kors to have made, it makes sense financially and in a business sense. I guess we’ll just have to wait to see what happens.