The Gabriela Hearst-fueled turnaround at Chloé is gathering steam — while heating up the planet as little as possible.
Revenues at the Paris-based fashion house have risen 60 percent in the two years since the designer took up the creative helm, with low-impact Nama sneakers, recycled denim and linen Woody tote bags among items selling briskly — and all leaving a small environmental footprint.
Hearst said she’s eagerly awaiting the results of a third-party audit that should prove Chloé has lowered its carbon footprint and aided biodiversity, even as it racks up a number of volume-drivers. The environmental report is due out in June, and a pioneering social profit and loss account, akin to an EP&L, next month.
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“This is very exciting, because it means that the mission that we had started can be taken as a model to be replicated by others,” she said.
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“You can only improve what you measure,” added Riccardo Bellini, chief executive officer of Chloé.
In their first joint interview since Hearst came on board in December 2020, the fashion duo recounted the progress they’ve made while describing their transformation of the company to a purpose-driven, socially engaged enterprise as a long-term project they are committed to tackling together.
Sparring good-naturedly, laughing frequently, and often anticipating each other’s answers, they explained the complexities of building sales momentum for the business while ensuring a positive impact on the planet and people.
“Every time we launch a new product, we ask ourselves how we can decrease that environmental impact: How can we use the power of our sourcing to create a larger value for our communities and stakeholders,” Bellini explained, describing a “constant trade-off” between business ambitions and Chloé’s ecological and social principles. “What unites us, especially in those difficult moments, is this shared conviction and shared ambition to prove something that today does not exist.”
Hearst noted that since she arrived, Chloé has not sold any cotton T-shirts, simply because that fabric is problematic when measured in terms of sustainability.
“It affects our biodiversity, it takes a lot of herbicides and pesticides when it’s nonorganic that affect the insect world. It absorbs a lot of water,” Hearst said. “I prefer linen because it doesn’t use herbicides and pesticides, and you can also use the flax seed.”
In fact, Hearst has overhauled all the fabrics used for Chloé ready-to-wear, replacing cashmere with recycled cashmere, and new denim with circular denim, made of 87 percent recycled cotton and 13 percent hemp, or 80 percent recycled cotton and 20 percent linen. Cotton linings in handbags are gradually being replaced with lower-impact linen.
“Right now Chloé is using 60 percent low-impact materials. We accomplished that in two years. And that can only happen if a CEO says, ‘I believe in this. Yes, we should do this,'” Hearst said.
A pensive, yet ebullient executive, Bellini had initiated Chloé’s shift to a purpose-driven business model shortly after he arrived in 2019 from Maison Margiela, recognizing in Chloé’s roots a strong commitment to women’s freedom and progress.
He found in Hearst a dance partner with the same feisty, disruptive spirit as house founder Gaby Aghion — and with a drive to succeed rivaled only by her strict eco convictions.
“I can’t turn a blind eye to the climate crisis, which is the threat to our species,” she said firmly.
But nor does she turn blind eye to the bottom line.
“At the end of the day, it is a business, right? First and foremost, we sell product that people don’t need, but they have to desire.…And it has to have longevity, because this is a heritage brand,” she said in the interview.
Hearst noted that as a longtime entrepreneur and business owner she “cares about the money” and abhors wastefulness. When she arrived at Chloé she found fresh flowers adorning her Paris office, and an invitation to redecorate the room as she saw fit.
“That’s a very nice thing, but I was like, ‘I don’t need the fresh flowers, and I’m not redoing my office. We’re gonna get to work,'” she said.
The task was large: to restore energy and growth to a brand whose business had softened.
“What Gabi brought within the creative process is that sense of mission and she managed to federate the teams around this very strong sense of mission,” Bellini enthused, adding that she “has an exceptional ability to raise the energy of people and create the condition for creativity to thrive.”
What’s more, Hearst brought “an uncompromising vision of brand elevation” that extends all the way to the rose quartz and ceramic buttons she applies to her collections.
In the interview, Hearst noted that she arrived at Chloé with almost 20 years’ experience as an entrepreneur, starting with her first New York City fashion business Candela, a bohemian contemporary brand launched in 2004, and then her namesake luxury house in 2015, based on the principles of timelessness, quality and sustainability.
She took home the the American Womenswear Designer of the Year prize at the CFDA Fashion Awards in 2020.
At Chloé, she described an extensive retooling of the organization and rallying everyone to dedicate themselves to “the excitement of building something better.”
“The change cannot happen from one person,” she stressed. “It’s the machine that has to change and be willing to change. So the CEO, the creative director, the head of production, the head of sustainability — everyone.”
In October 2021, Chloé became the first European luxury maison to receive B Corp status, a major stepping stone on its long path to fully becoming a company that is purpose-driven, planet-friendly, community-based and accountable.
Hearst described the Nama sneaker, introduced in December 2021, as an example of teamwork — and the fruit of eight months of design and development. Third-party analysis revealed that the shoes produced 35 percent less greenhouse gases and used 80 percent less water than the previous sneaker model, Sonnie.
“When you have numbers like these, you feel confident that you can push this sneaker,” she said, noting that the Nama is now Chloé’s number-one shoe. “But first and foremost the sneaker sells because it’s cool.”
Meanwhile, Hearst touted Chloé’s overhaul of its denim supply chain as an example of an almost eerie complicity between her and Bellini.
“I had this dream of making denim circular and there was only one face that would appear in my head. I didn’t say a word, and then Riccardo went, ‘Let’s get Adriano Goldschmied to help us in the project.’ And that’s synergy, that’s alchemy — and you cannot fake that.”
It is understood the Compagnie Financière Richemont-owned fashion house has set an internal target of 1 billion euros in revenue, but without a specific timeframe in mind given how closely its business growth is tethered to its social and environmental sustainability ethos.
The Swiss group, best known for its flagship Cartier brand and a host of watch brands, does not break down revenues by brand. Last month, Richemont cited higher sales across most of its fashion and accessories maisons, amounting to 6 percent sales growth in its “other” business area, which also encompasses Alaïa, AZ Factory, Delvaux, Dunhill, Montblanc, Peter Millar, Purdey, Serapian and Watchfinder & Co.
Bellini flagged the 60 percent uptick since 2020 and cited double-digit growth in all categories and regions, despite the coronavirus pandemic.
“From a business KPI perspective, we are on the right track,” he said. “We see a very positive dynamic on client acquisitions. We see a new flow of clients that we didn’t see before, including high-net-worth individuals, clients that are coming back to the brand, as well as new clients that are coming into the brand.”
The executive also confirmed that Chloé is profitable.
The company was able to log such quick progress by focusing on the “traditional volume pillars” of the brand. “There, we needed solutions in design, materiality and construction, that would help us accelerate,” the executive said. “Cutting cotton is a business decision as much as a design decision. You can’t achieve an ambitious, sustainable progress on sustainability without a strong synergy between creative and business.
“We are putting in place a model which is working from a business point of view,” he continued. “We achieved that type of growth while reducing our carbon footprint, while improving our social procurement and while engaging more and more social and fair-trade enterprises that allow us to improve the impact on larger communities.”
He also stressed that it requires a long-term commitment from him and Hearst.
“A lot has been achieved, and we are still scratching the surface of where we need to go,” Bellini said. “But we put in place the right foundation for the marathon for the future and that’s what we really focused on together.…We’re trying to prioritize long-term growth versus short-term gains essentially.”
Hearst noted that when she joined Chloé, there was one person dedicated sustainability. “And now we have a team of 10,” she said. “That’s another CEO decision — to say, ‘Yes, we need to strengthen this.’ And now we have an extremely driven sustainability team that is comparable to much bigger brands than us.
“It takes constant self-examination, from packaging, to product to events,” she continued. “It’s a line that goes through the whole process and it becomes a mentality in the company. Now people are coming to Chloé to work because of this, too, because people want purpose in their lives.”
“We are both quite passionate and quite convinced and stubborn on the vision and on the project,” Bellini said, confessing that he and Hearst have nicknamed each other “volcanoes,” reflecting their fiery personalities.
They acknowledge that tensions between the creative and business sides can be fruitful.
For example, Bellini said he had identified sneakers as an opportunity for Chloé, which Hearst initially resisted given the ubiquity of traditional athletic shoes from designer brands and the traditionally damaging production processes around them. This unleashed an unorthodox design along with a host of technical solutions and innovations, up to and including water-soluble glue.
“Eighty percent of environmental issues are solved at the design table,” Bellini said, while hastening to add that “some of the best discussions with Gabi have actually been business discussions. We spend a lot of time on strategies, on plans, on retail.”
Indeed, company-owned retail will be a big focus in 2023, with a new interior design concept slated to debut over the next year. Details are still under wraps.
“This will initiate an important program of renewal of our retail network and then the expansion of our network that will come from that,” Bellini hinted. “Growing our share of d-to-c remains one of the fundamental goals.”
The brand opened 11 stores over the last year, helping to shift the weight of its direct-to-consumer business to 60 percent, with the balance in wholesale.
Hearst stressed that she’s obsessed with how her designs are being received by the end consumer.
“My self-esteem is attached to sell-through,” she said bluntly.
To help boost both, the designer records long, detailed videos about each collection specifically for store managers and sales associates.
“It’s very important that our teams are informed of all the efforts and all the work, because everything that we do has a purpose,” she explained. “I can sketch and do my little abstract drawings at home and be very happy creatively. But at the end of the day, we’re trying to prove a [business] model.
“As Riccardo pointed out correctly, we’re a business that is proving that we can be successful and doing good at the same time — that you do not have to compromise on the social component, or on respect to the environment.”
For her pre-fall collection, 59 percent of fabrics used were considered low-impact and all the denim pieces were made with 83 percent post-consumer products, or “trash,” as Hearst likes to call it. Trash is also the original material for a new range of eyewear — made from recycled acetate.
Having upped her denim, shoe and sunglass games at Chloé, what’s next?
“The bag game is about to get hot,” she declared. “And I’m very excited about the ready-to-wear.”
Chloé’s next show is scheduled for March 2 during Paris Fashion Week.
Hearst acknowledged there was some initial culture shock stepping into a storied French maison, having grown up on a ranch in Uruguay — she is the only Latin woman to head a major French house, to her knowledge — and having cut her designer teeth in Manhattan’s Garment District.
Yet she grew up loving Chloé, wearing its signature perfume and saving up to buy the Edith bag, her first luxury leather goods purchase.
She’s encountered like-minded women in unexpected places, recalling an attempt to fly to Buenos Aires from New York during the coronavirus pandemic. She was not allowed to enter Argentina and while in custody, confessed to one of the customs officers that she was about to sign on to design Chloé. The official’s reaction? “Wow, I love Chloé!”
Hearst credits the founder for instilling in the house a strong spirit and DNA that persists to this day.
“I couldn’t do this job if this was another brand. I love Chloé very much. And it was a language that I understood as original to me,” she said. “I understood the codes and I understood intrinsically the aesthetic.”
The brand will communicating more about its heritage throughout 2023, when it will celebrate its 70th anniversary. Exhibitions are being planned, along with a documentary, books and other activations.
Those efforts, and the encouraging business progress, should dampen any skepticism about the longevity of Chloé’s new dynamic duo.
“We are now just at the beginning of a long-term project, and the ambition still remains quite, quite big,” Bellini said. “We are a winning team, I believe that what we are putting in place is working beyond what you might expect and that we have a long way still to go.”
He also stressed the unity between him and Hearst. “We all feel the responsibility to make our imprint, to leave a legacy, to make this maison stronger whenever we do leave and to make this chapter as glorious as possible.”
Added Hearst: “It takes time to build things well.”