June 5, 2023

United Colors of Benetton: A Global Giant in the 1980's Now in Family Hands, But Has Yet to Make Its Comeback

For anyone who came of age during the 1980's, it was kind of hard to avoid a certain Italy-based fashion-brand: Benetton. Benetton was an iconic brand in the 1980's, but since then, its fortunes have fallen and the company has since struggled to regain that position. For example, back in 2000, it ranked 75th in Interbrand's ranking of the best global brands; however, by 2002, Benetton had dropped out of the list. In 2012, Benetton Group was de-listed from the stock exchange and is now a fully owned subsidiary of the Benetton family company Edizione holding.

But back in the eighties, the company had a ubiquitous and controversial ad campaign which became known as "The United Colors of Benetton" and it had retail stores in major shopping malls across the U.S. What made the Italian brand stand out were two elements.

First, Benetton's ads were considered controversial at the time, which generated a lot of word-of-mouth discussion of the brand, and that placed Benetton on the cutting edge of culture. For example, some ads featured a newborn baby with the umbilical cord still intact, or an artistic reproduction of a man dying of AIDS. Benetton's ads also embraced multiculturalism before that was even a thing.






Some Benetton ads featured a mixed-race lesbian family, or a nun and a priest kissing – which pushed the boundaries of the era before the internet. Remember: at the time, the U.S. and Europe remained predominantly white (in fact, higher birth rates were happening among non-white populations at the time, which meant it was inevitable that multiculturalism would eventually happen, but conservative groups turned a blind-eye to that not-so-little demographic reality).

Second was the clothing itself. 

Benetton's clothing designs had become known for their bright, bold-colored sweaters and they were also very comfortable to wear. The company had particular expertise in knitwear, the original products were fun, easy-to-wear, and distinctly Italian. There was a certain flair to them, and they were soft and touchable in an age of polyester. Dyeing garments at the last minute meant that the company could be flexible and responsive, reacting quickly to changes in demand. If red was selling well, it could quickly ramp-up production of red knitwear. Or blue, green, yellow or any other color. But most importantly, they were colorful.

Also critical to the company's success at the time was its use of sophisticated inventory control and its organization of a network of suppliers, originally located nearby in northeastern Italy. Being able to track stock and know exactly what was selling and where meant that Benetton could plan the flow of supply to stores, while designing and producing clothes consumers wanted to buy.

But those innovations were eventually copied by other retailers and were no longer so groundbreaking by the time the mid-1990's arrived. Benetton eventually closed every store it had in the U.S., which was why when the company reported plans to open a pop-up store in Los Angeles in 2019 (see https://www.forbes.com/sites/rebeccasuhrawardi/2019/10/29/wondering-what-happened-to-benetton-theyre-plotting-stateside-growth-starting-in-la/ for more), that made news. Only then Covid-19 hit and those plans were derailed.

While the company remains in private hands in 2023, its much talked-about comeback has yet to happen in spite of reports that it was working on plans for doing so. Which means none of the company's revitalization have really succeeded so far. 

But its still worth acknowledging the company's iconic status during the 1980's. It really was everywhere. When the New York Times reported (see https://www.nytimes.com/1984/09/25/business/benetton-fashion-s-maverick.html for the scan) on the company on September 25, 1984, Benetton reportedly had 180 stores in North America, including at least one in every U.S. state. Eventually, every U.S. store closed.

To watch one of Benetton's TV ads from the mid-1980's, see below or visit https://youtu.be/xwyIKkV9ZkQ.

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