L’industria della moda e la gestione dell’incertezza - Enrico Moretti Polegato ITA

It was a very interesting operation because it was about trying to save what is not just a brand but a piece of sports history. The operation started in 2007 when our family, which also controls Geox, was asked to participate in the relaunch of Diadora, which was going through a period of economic and financial difficulty. It's a historic brand that this year celebrates its 62nd anniversary, and in the past it dressed the greatest athletes of various eras — Djokovic, Borg, Senna, and many others. When we were asked to participate, we saw a relaunch opportunity from three points of view. First, from a national pride and territorial standpoint — we didn't want such a beloved, historic, and meaningful brand to end up in bankruptcy. Second, from a strategic and entrepreneurial perspective — it was clear that it was more Diadora's management that was in difficulty than the brand itself. The brand maybe wasn't as visible, but it hadn't been damaged by the company's difficulties. And third, from a personal and professional standpoint — I had the opportunity to have an entrepreneurial experience with my own responsibility, my challenge, and my own team, without always being in the family company. Over ten years, the first objectives we set have been largely achieved — making the company solid economically, financially, and commercially, and making the brand visible by speaking the language of inclusive Italian sport, and we are satisfied with the results.

I'd say it brought me the results I hoped for, both from a business standpoint and a personal one. We're talking about a company that most people in the world don't even know exists, so it's not a matter of having left or failed to do something. What I did here — yes, I did well to try it with my team.

Revenue has reached 168 million euros, excluding licensed products, brand extensions, and geographic extensions. The company has started generating profits again from the first year we managed it, and this profit and cash generation has continued every year.

The year is clearly quite complicated, but from the vantage point we have here, looking at updated data day by day, we think we'll deliver better results than we believed back in March, when the world started to waver under the blows of this pandemic. What's positive is that this improvement, both economically and financially, is driven by market segments we had bet on because they define Diadora's identity, and by segments where we have direct contact with the consumer. The positive response comes directly from those who appreciate and wear our product. In particular, I'm referring to running. As we said yesterday, Diadora is fundamentally a sports company, which means the brand and product identity must be sportive. When we decided to reassert Diadora not only in professional sport but also in active, played sport, we chose running, and results are coming even in a difficult year like this. Also growing are complex markets like the United States. We have a commercial subsidiary focused on developing high-level running footwear sales, and it's reporting excellent results. When we started, it was a gamble — selling running shoes in the US was like selling refrigerators in Greenland. But this mix of Italian style, heritage, and technological research has resonated even there.

It depends on the markets and product categories. If we're talking about running, Diadora only seriously started a few years ago under the new management, so the brand's authenticity in that area has been built by us recently. It's different when it comes to the attachment an Italian can have for a brand recognized as historic. And then there are products like our Heritage line — everyday sneakers, not for high-level sports — that reproduce historic Diadora models, where the brand's heritage is the very reason for the line's existence. The Heritage line is made in Italy. But in reality, Diadora's relationship with Italy was far more deep-rooted than just a Heritage line. Italianness is certainly one of the constitutive elements of the Diadora brand. Initially, we interpreted our being Italian primarily as Italian design and Italian know-how. In a product like footwear, the Veneto region is recognized for its design value. But then we decided to invest further in our Italian identity and started a reshoring process, bringing back to Italy part of the production that had been outsourced. As the core of this reshoring project, we reopened a historic production line here at our headquarters in Caerano di San Marco, at the heart of the sports footwear district, where we produce the top-of-the-line Made in Italy range.

This isn't a decision from recent months. A company made up largely of millennials, like Diadora, has in its DNA this attention to the digital world — not only commercially but also in communications and corporate management. Certainly during the pandemic, with the retail world closed, our online distribution — both through independent retailers and our own site — enjoyed an acceleration.

E-commerce in total represents about 5 to 8 percent of our revenues. We don't have a retail chain — which was the other part of the question — a chain of brick-and-mortar monobrand stores. We have a few in our country, but it's not part of the company's development strategy.

We've greatly accelerated. First, because sustainability is part of my identity as a human being before being an entrepreneur — my home was the first civil-use building in Europe to obtain LEED Platinum certification. Diadora is a company founded largely by millennials, with an average employee age around 30 — a generation born with awareness of the need for a different approach. We have a sustainability department that, together with management, develops a plan updated year by year, unfolding through three main channels: supply chain control, product innovation, and corporate activities. For supply chain control, we require all suppliers to obtain EcoVadis certification — one of the largest audit programs. We obtained Platinum EcoVadis certification, placing us in the top 5 percent of sustainability performance in our sector. For product innovation, our T-shirts are all made from GOTS-certified organic cotton covering the entire supply chain. We were among the first to abolish kangaroo leather from our products. The boxes for our Heritage line are made from a material derived from excess algae in the seas. And on the corporate side — we have solar panels sufficient to power our entire Made in Italy production line with renewable energy. We have agreements with local entities like Parco Natura Viva in Verona, supporting a biopark. And perhaps most moving is our agreement with the Peres Center for Peace, founded by the former President of Israel, a friend of our family. This interfaith dialogue center's sports activities are sponsored by Diadora. Sport is a way to communicate, perhaps a first step toward understanding. Last year we organized a football match between Israeli and Palestinian children — mixed teams — a beautiful moment of togetherness. We hope it can serve some purpose.