One weird corporate gift I got this christmas was a branded watch made by Ungaro. Weird because I never associated that brand with cheap corporate giveaways. Ungaro is a designer that was very popular in the '80s and '90s, especially for figure-hugging women's dresses.

So I checked up on them online, to see how they have fared this century, and found a very interesting article from the NY Times, a 2010 edition. Enjoy reading below

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The Fall of the House of Ungaro
By CATHY HORYN | August 20, 2010

When I first heard this story from Asim Abdullah’s own lips, over tea at the St. Regis hotel in New York, I thought he was one of the saddest cases I had ever met. He is really in over his head, I thought, and he isn’t even done yet. I should probably tell you that this was not my first meeting with Asim Abdullah — that occurred late one night in January, briefly and quite by chance, as I was leaving the Hôtel Plaza Athénée in Paris following dinner with some girlfriends, but clearly it left an impression on me. As we set foot toward the revolving door, one of my friends, a lively, stunning woman, nudged me and said under her breath, “That’s the man who owns Ungaro.”


Now, many people know Ungaro because it was prominent in the ’80s and ’90s. If you were a snooty boutique owner in Dallas or New York and you couldn’t sell an Ungaro dress with the drapery pouring over the breasts and thighs like butter on a hot ear of corn, you had no business being in retail. Men loved a woman in an Ungaro dress, it was said, because the style and the vibrant colors made them imagine what she had on underneath — in a way that an Armani pantsuit did not — and, further, what they might do with this thought. The woman, then, had utterly enslaved the poor devils, and made them pay for the privilege besides. That was essentially Emanuel Ungaro’s approach when he opened the house in 1967 on the Avenue Montaigne. Make them pay!

With this basic formula, and the extra sheen of Ungaro’s haute couture gowns, real harem stuff, the business became extremely successful. Nearly all of its revenue came from licenses — the Emanuel line, for instance, a division of $400 jackets and dresses created for American department stores, at its peak did $180 million a year — and Ungaro and his family grew very wealthy. But by 1996, for one reason or another, he decided to sell the house to the Ferragamo shoe firm. It was the curse of these old Avenue Montaigne houses that their culture was based on a master-slave relationship; nothing could happen until the master, in a white lab coat, signaled he was ready to be handed another straight pin, and then everybody could breathe again. Anyhow, by the time the Ferragamos grasped this madness, Ungaro was losing roughly $15 million a year, and they signaled to their bankers to look for a buyer.

Abdullah was the only serious buyer who turned up. That was in 2005, and as you probably guessed, he had no experience in fashion. When he called his wife, Isha, at home in Atherton, Calif., near San Francisco, where she was taking care of their two boys, she answered, “Are you talking about the Ungaro?” Abdullah was then a 42-year-old computer engineer, originally from Karachi, Pakistan, who had gone to graduate school at Stanford and, thanks to his entrepreneurial efforts — and good timing — had made a fortune in technology. As serious and plodding as he is by nature, the experience of seeing the price of a tech share rise 1,000 percent in a few months rewired his brain. Gogol once wrote that everyone has his own craze. And Abdullah itched for that excitement and pride he felt in the late ’90s, when he and another entrepreneur started Veo Systems, which created software for e-commerce. They merged with Commerce One, and Abdullah became a director. He was there for its public offering and left, taking out half of his shares, about six months before the tech bubble burst.

So when he heard during a business trip to Paris that Ungaro was for sale, his heart began to pound. Sure, he had doubts, he said — “right up to the last second.” But he was intrigued by the notion of marketing luxury brands. And he felt very confident that if he hired “the best people” and let them do their jobs — empower the slaves! — then he could probably turn Ungaro around in a few years. Despite her initial reaction, Isha, a doctor and a woman of remarkable patience, felt that a new challenge would do her husband good. He had spent the previous few years playing golf and buying vintage cars and going to auctions. As far as Isha was concerned, the house didn’t need another painting. “We’re the kind of people who really need intellectual engagement,” she said.

Well, nothing has worked out as Abdullah planned. Instead of hiring “the best people,” he trusted the wrong people, most onerously the man he put in charge, Mounir Moufarrige. Three designers have left, beginning with Peter Dundas, now a star at Pucci. Virtually all of Ungaro’s business in this country has vanished, and the total ready-to-wear volume next year is a projected $13 million. Abdullah reportedly paid $84 million for Ungaro — and he is still writing checks. Meanwhile, he has put on weight and started smoking again. Abdullah is a man of good character, but he had no instincts for the fashion world, for its fast talkers and almost invisible snares. This was obvious last fall when he agreed to hire Lindsay Lohan as “artistic adviser” for Ungaro. Forty years of labor and passion had gone into that house, and he blew it by putting Loony Lohan on the runway. Who was going to touch a $2,000 Ungaro dress now? The whole thing made Abdullah sick with misery.

It was not long after that I saw him in the revolving door. He had evidently been out for a smoke, for he was coatless. He looked nervous and sweaty, his gray-streaked hair falling in slats across his forehead, his shirt buttons at war with his paunch, and in a flicker of recognition I thought I detected the frantic, pleading look of a drowning man. Then he waved doggedly from his glass compartment. Maybe it was the hour, or the stress. He was away from his family for weeks at a time, living at the Plaza, as the regulars call it, amid the hydroponic floral schemes and the egos boasting and lurking in the bar. The best that he could hope for, considering everything, was that a permanent volcanic ash cloud would settle over the Avenue Montaigne.

Was it vanity? Restlessness? What makes a rational man choose behavior that, upon reflection, is irrational and self-destructive? Abdullah’s preparedness for entering the fashion business was exactly that of an earnest man diving into a swimming pool without checking to see if it has water. To be sure, it’s an old, old story — overconfident men getting burned — but in the past 15 years it has been exacerbated by the number of people with excess capital (created in part by the tech bubble) and by the amount of low-hanging fruit around. To someone with Abdullah’s resources and smattering of interests, Ungaro would look tempting. But by 2005, the big luxury goods players, LVMH and PPR, had determined that no fashion brands in Europe were worth buying except those well out of reach — Chanel and Armani.

Ron Frasch, the president of Saks, admires Abdullah’s zeal and likes him personally. “I feel a little sorry that he has been kind of rope-a-doped, as we say in the industry. He’s a fine, honorable person,” Frasch said. “It’s hard to enter this business without any knowledge. Everybody’s a seller and they can dust off an old rotted-out peach and make it look good.”

When I saw Abdullah in Paris in June, he said, “I’m very conscious of how the world perceives me — ” he paused — “as this Silicon Valley, accidental rich guy who bought this house so he can have fun.” Abdullah tends to avoid reporters. But he is warm and candid, with a dry sense of humor. It’s the way he tells a story at his own expense. For some reason, I asked him about golf. We were sitting on a sidewalk terrace. Brightly he replied, “I love golf. I study it, I worry about it, I work on it, and I’m not that good.” He wasn’t being modest, either. Later, when I spoke to his golfing buddy Sabeer Bhatia, a co-founder of Hotmail, he told me, “His game hasn’t improved that dramatically.”

But Abdullah’s worries often get the better of him. Chiefly he wonders if he hasn’t wasted the last six years.

Many businessmen have been spellbound by fashion, but Abdullah actually missed the trip wires of models and runway shows. He can remember only a few times when he accompanied his wife to a store. When he reflected on why the wives of the wealthiest dot-com people had never become clients of haute couture, in spite of eccentric enough tastes, he smiled faintly. “Because they look down on this industry,” he said. “I mean, they’ll do something really stupid like build a giant telescope to look at the heavens from their house and spend several million dollars to do that. You also must realize that a lot of people in Silicon Valley come from fairly humble origins. It’s not the sons of established money. You come to Silicon Valley and you forget what your culture is, what your color is, what your religion is. Everything else becomes secondary, and that’s sort of the magic of Silicon Valley.”

You can’t blame Abdullah for wanting to bring the self-empowerment rap to the Paris fashion world and break up the master-slave relationship, which has been going strong for 70 years and has to do with the hierarchy of couture. It really cranks him when a young assistant asks what kind of flowers he wants on the reception desk. He wants to tell her, “You decide! You’re free!” He doesn’t see how a business can thrive with so many people doing someone else’s bidding. But the fact is, in fashion, the designer sets the aesthetic tone for a brand and the C.E.O. or owner is there to enforce every choice, silly or not.

However, Abdullah wanted his chief executive, Moufarrige, to be in charge. “I’ve never felt that I’m the one making the business decisions,” he told me. “You leave the decisions to the decision makers.” You may discern here that this was Abdullah’s first mistake. Moufarrige has been around the industry for years. A tall, avuncular man, he recalls one of Gogol’s more ingratiating characters: his pleasantness has “much too much sugar in it.” He relishes telling people that he was the one who picked Stella McCartney for Chloé, which he did, but Chloé’s real success has been due to Ralph Toledano, its C.E.O. for the past decade.

Anyway, at the time Moufarrige was hired, in 2006, he said that Abdullah told him, “I know nothing about this business. I’ll be very honest with you, I don’t want to know anything — it would take me years to learn.” Moufarrige paused, making a noise that sounded like a chuckle. “He always used to tell people in the first two years, ‘He’s my teacher.’ He’s very sweet.”

Moufarrige insists that he didn’t make any decisions without speaking to Abdullah. Nonetheless Moufarrige was soon telling Dundas, who had been hired before he arrived, what kind of clothes he should design: he wanted more dresses and prints. “I wasn’t voicing a personal concern,” Moufarrige drawled. “I was voicing a concern of all the major stores.” Dundas’s designs certainly pushed boundaries of taste and elegance — he was really influenced, he said, by his memories of the brand rather than by the archive — but the more acute source of tension in the house, many say, was that Moufarrige tried to play creative director. (The stylist George Cortina, who worked at Ungaro with Dundas, said, “It was the worst experience I can remember,” recalling a 2 a.m. scene when he warned Moufarrige, whom he found rearranging Dundas’s show lineup, that he would be thrown out a window if he continued meddling.)

“Look at the critics,” Moufarrige urged Abdullah. “If we don’t change Peter, we’re going to have a major problem.” Though Dundas’s departure in July 2007 put Ungaro further back and made it impossible to recruit a top designer — “The house had developed a bit of a reputation,” Abdullah admits — he continued to trust Moufarrige. And time and time again Moufarrige’s seductive confidence and great words must have soothed his eager pupil.

But it was a good thing that Abdullah had his wife to talk to. “She’s been a very supportive woman,” he said. “I think I spend 90 percent of our conversations on this fashion house. She listens, she gives her opinion. And for some stupid reason she still trusts me.”

Isha seems to understand the problem. In the tech world, she said, Abdullah “has hardly ever needed to rely on intuition and vibes. It’s more of a womanly thing to do,” she said. Besides, people were very direct. After a few years at Ungaro, he realized that fashion wasn’t all that complicated. “But Asim was not ready to listen to his intuition,” his wife said. “He was still reluctant to take a hands-on role and say, ‘O.K., it’s not rocket science.’ He was still relying on advice that had hidden agendas. As it is, I think it’s very difficult for women to get seduced by words. But Asim had to learn the hard way.”

By the fall of 2007, things at Ungaro were going downhill. Unable to attract a star, Abdullah hired Esteban Cortazar, an obscure young designer in New York. Naturally Cortazar was awed to find himself in such a high position, and it wasn’t long before Moufarrige was telling him what to design. “It was obvious that a lot of the ideas just felt dated,” Cortazar told me. “In general everyone in the house felt disconnected from Mounir. It was always what he wanted.”

Moufarrige had begun to push the idea of teaming up with a celebrity who might put some heft behind the brand, make some noise. Otherwise, he argued, the standard approach of developing a new identity might take years before the house saw a profit. “He really thought that idea was going to work,” Cortazar said. “I saw this person convincing Asim that this was the direction to take. There was nothing I could do. I said, ‘Go for it, but I can’t be part of it.’ ” Cortazar also thought Abdullah asked too many people for advice.

So he left, and Moufarrige replaced him with Estrella Archs, who could work with Lohan. Meanwhile, ignoring that he was the C.E.O. of an Avenue Montaigne house, Moufarrige began to name-drop like mad, telling Abdullah that such and such editors were in favor of Lohan.

Abdullah was stunned by the power of editors, referring to them as oligarchs, and he greatly disliked the kowtowing. He also struggled to understand their decisions — they seemed so arbitrary to him. One reason he liked the idea of using a celebrity — and, O.K., he said, maybe in hindsight Lohan wasn’t the best choice — was that it bypassed the traditional tastemakers that exist between the creative process and consumers. “If you look at almost any other business, that is what is going away — the intermediaries,” he said.

Still, when Moufarrige told Abdullah that he had visited Anna Wintour in her office at Vogue and that he had her support for the Lohan decision, Abdullah didn’t mind having an important editor on his side.

Anyway, Wintour says she never O.K.’d the Lohan idea, which in any case was a fait accompli when Moufarrige arrived at her office. What she told him, she said, was that she was strongly opposed to it.

Moufarrige, who resigned in December, doesn’t accept that the erupting howls in the press hurt Ungaro or that he was responsible. Instead he blames Estrella Archs. “Lindsay, poor thing, didn’t have much to do with the collection,” he said. “But we had so much noise.”

Well, that’s almost the whole sad story. In May, Abdullah hired the designer Giles Deacon. He had also put Marie Fournier, a longtime operations executive at Ungaro, in charge of the business. Reaction to the choice of Deacon, who received a small equity stake in the company and who will show his first collection in October, was positive. The company was almost like a startup, Abdullah said, not displeased; he felt that Deacon would finally be able to provide creative leadership. However, Ron Frasch of Saks pointed out that the luxury industry has emerged from the economic crisis leaner and fiercely competitive. Even the most seasoned professionals now find themselves in a new wilderness. How would Ungaro be able to catch up? And do women want those kind of femme fatale clothes again? Frasch also questioned whether Fournier was the right person for the job. “I truly respect her, but she doesn’t have the background to rebuild a brand,” Frasch said. “You need a Ralph Toledano type who understands all the steps. While the brand has extraordinary heritage, I think the jury is out.”

I asked the chief executive of a prominent French fashion house if he thought Abdullah could succeed at Ungaro, and he said no.

“But Abdullah is a smart guy,” I protested, pointing to Silicon Valley. “Listen,” the executive said, “I think I’m smart, but if I were running an airplane company, do you think I could make smart decisions? What people see from the outside is the irrational part of fashion. But on the inside you have to be extremely rigorous to reduce that to a minimum. Otherwise it becomes what Ungaro is — total irrationality and emotion.”

“So what should Abdullah do?” I said.

“Give the company to someone for one euro and go and enjoy his life.”

Abdullah probably wouldn’t do that. Too much pride. Besides, he finally has a handle on fashion. “I think my instincts are a bit more developed than they were five years ago,” he said. But then a few minutes later his mood changed, and he added, “It’s just that everything is so public. This isn’t me running a grocery store that’s going out of business. You start to lose confidence in yourself. At least I feel I’ve tried. I’ve been open to ideas. And that’s what bothers me. I was 40 years old and sitting on top of the world. Here I am, 47 and thinking, What else could I have done the last six years of my life? Not necessarily in terms of business, but maybe there was a more productive path I could have taken. I brood a lot,” he said. “I worry about this company every second of my life. I haven’t talked to my kids in four days. I’ve hardly talked to my wife. I’m brooding.” He laughed, to let me know he wasn’t as crazy as all that.

When I told his wife word for word what he had said, Isha let out a sigh. “I hate the fact that he is second-guessing himself,” she said. “Because, believe me, as his wife who has a simple faith in him, he’s one of the smartest people I’ve ever come across, and I’m surrounded by the best brains. Asim should never have to second-guess himself.

“Yes,” she added, “he’s missing his family and we’re missing him.”

Source: http://www.nytimes.com/2010/08/22/t-magazine/22well-ungaro-t.html?pagewanted=all&_r=0