Demna’s Arrival at Gucci Sparks Uncertainty in the Market

Demna’s appointment at Gucci has raised uncertainty among analysts and investors, who question his provocative style and its impact on the brand.

The recent designation of Demna as Gucci’s creative director has sparked mixed reactions among analysts and investors. While his tenure at Balenciaga positions him as one of the most influential figures in the industry, his bold and avant-garde style raises doubts about his fit within the iconic Italian brand.

Carole Madjo, an analyst at Barclays, expressed surprise at the decision, noting that his “bold and sometimes controversial aesthetic” presents “as many risks as opportunities” for Gucci. This strategic shift comes after two years in which the fashion house had focused on a more “timeless” approach and is now seeking to reclaim its authority in the industry.

The impact of the announcement was immediately felt on the stock market, with Kering—the parent company of Gucci—seeing its shares drop by 11.2%. A key concern is Demna’s recent track record, as his dystopian and underground vision “may not resonate with Gucci’s consumers,” according to Barclays. Additionally, some analysts fear that his “occasionally provocative” approach could lead to controversies similar to those that affected Balenciaga in 2022.

On the other hand, Oliver Chen from TD Cowen took a more optimistic stance, highlighting Demna’s potential to attract new audiences. “Demna has the potential to be a great leader for Gucci’s next era,” he stated, emphasizing his ability to merge streetwear, tailoring, and women’s fashion.

As Gucci seeks to regain its former glory following Alessandro Michele’s departure, only time will tell whether the bet on Demna will successfully revitalize the brand or prove to be a greater risk than anticipated.