Italian sportswear firm
Founded: by Giuliana (1938—), Luciano (1935—), Gilberto (1941—), and Carlo (1943—) Benetton, in Treviso, in 1965 as Maglificio di Ponzano Veneto dei Fratelli Benetton. Company History: First Benetton outlet opened in Belluno, Italy, 1968; first shop outside Italy, in Paris, 1969; launched major European expansion campaign, from 1978; first U.S. store, New York, 1979; first Eastern European shop, Prague, 1985; went public in Milan, 1986; formed Benetton Sportsystem SpA, 1989; opened huge stores in Paris, London, Barcelona, Lisbon, Frankfurt, Vienna, Prague, and Sarajevo, 1994; opened 50 shops in China and factory in Egypt, 1995; opened London megastore and New York flagship, 1996; bought sports group from parent company, 1997; formed Benetton USA with Sears, 1998; introduced Playlife stores, 1998-99; dumped by Sears, 2000; concentrated expansion in U.S., 2001. Company Address: Via Chiesa Ponzano 24, 31050 Ponzano Veneto, Treviso, Italy. Company Website: www.benetton.com.
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In recent years the Benetton Group of Italy has become better known for controversial advertising campaigns than for the brightly-colored knitted sweaters with which the company was founded in 1965. As part of a well defined global strategy to make the Benetton name as well known as McDonald's or Coca-Cola, the sibling members of the Benetton family—Giuliana, Luciano, Gilberto, and Carlo Benetton—created a multibillion-lire business with an ever growing cadre of shops in 120 countries worldwide. The company is a leading producer and retailer of casual apparel and sports-related goods, as well as licensed accessories such as cosmetics, toys, swimwear, eyeglasses, watches, stationery, underwear, shoes, and household items.
Benetton collections are aimed at young people and children, but over the years have been adopted by consumers of all ages. United Colors of Benetton attempts to transcend gender, social class, and nationality by manufacturing knitwear that exemplifies a philosophy of life. This was explicitly reflected in longtime creative director Oliviero Toscani's 1983 advertising campaign "Benetton—All the Colors of the World." The campaign depicted groups of children representing all walks of life wearing colorful Benetton garments. Subsequent campaigns commented on political and social issues including religion, sex, terrorism, race, AIDS, and capital punishment, without depicting actual Benetton garments. A number of controversial campaigns were banned by advertising authorities, fueling unprecedented media coverage.
Similar in attitude to the California-based Esprit company, Benetton epitomizes the values of a generation of young, socially aware consumers. Garments are designed to be fun, casual with an easy-to-wear cut. Inspiration is often drawn from past sentiments but produced with a contemporary twist, like 1950s ski fashions in high-tech synthetic ice-pastel fabrics, 1960s tailored suits in herringbone, 1970s disco garments with sequins and leather combined. Other collections have been based on themes such as the Nordic for little girls, designed in new fabrics like fleece, and Riding Star, drawn from the world of horseback riding. In keeping with the company's cosmopolitan attitude, collections have also been drawn from Benetton family travels.In the beginning, Benetton sweaters were hand-knit by Giuliana in bright colors which distinguished them from existing English-made wool sweaters. The first collection consisted of 18 pieces, the most popular item being a violet pullover made from cashmere, wool, and angora. Today's apparel, of course, is produced on a much grander scale, using high-tech manufacturing and innovative marketing strategies. Benetton is certainly one of the most progressive clothing manufacturers in the world; yet its rapid rise has not come without a price. Profits fell off sharply after a lower-price initiative backfired in 1994; the European recession forced the closure of nearly 600 stores; its cosmetics division produced dismal results; then came family squabbles, and court battles with a group of German retailers who refused to pay for merchandise after another of Benetton's controversial ad campaigns (eventually resolved in Benetton's favor).
By 1995 a seemingly wiser Benetton had toned down its often offensive ads, belatedly realizing the shockwaves cost the firm time and money in having to defend its position. Instead, the firm concentrated on making money and much of it came from the expansion of sister firm, Benetton Sportsystem SpA, which unabashedly pursued its intention of becoming the world's largest sports equipment and accessory company. While Sportsystem was busy acquiring Rollerblade, Nordica, Langert, Prince, and others, Benetton was fielding major losses in the U.S. market.
By the end of the century, Benetton had opened a factory in Egypt and built megastores in London, New York, San Francisco, Moscow, Riyadh, Berlin, Hong Kong, and elsewhere. In a slick move, Benetton purchased a majorty stake in its sibling, Sportsystem, effectively segueing into the sporting goods and activewear industry, then introduced and stocked a chain of sporty stores called Playlife. To bolster its U.S. presence, the firm formed a joint venture with Sears (Benetton USA) and saw that alliance collapse after another provocative ad campaign ("We, on Death Row") enraged everyone from consumers to politicians in 2000.
Benetton had finally gone too far with its "shockvertising"—not only did it lose the lucrative contract with Sears and part ways with creative director Toscani after 18 years, but was forced to issue a formal apology to the families of those murdered by its poster-boy Death Row inmates. Ironically, a newer, gentler Benetton arose in 2001, surprising everyone with its low-key ads similar to those made popular by Gap. Generally panned, Benetton, as usual, ignored its critics and set about doing what it did best—selling Benetton. With new stores planned for a multitude of high profile cities in the U.S., Carlo Tunioli, executive vice president for Benetton USA, promised a bit of the old-style advertising in the near future. "Benetton will always be loyal to its brand DNA, which means social statement," Tunioli explained to Women's Wear Daily (20 March 2001). "Benetton will keep working in that direction, but much will be focused on product. It may be controversial, but we're not going to be controversial in the way you used to see Benetton." Time will tell if that holds true.