Can Diesel Repeat Its Y2K Success?

MILAN — The crowd at Wednesday’s Diesel show in Milan’s Allianz Cloud arena was 5,000 people deep.

Filling a stadium isn’t easy, even when the tickets are free. And it wasn’t just the size of the audience that was notable, but also its quality — reflecting Diesel’s still-fresh transformation from dated designer-denim pioneer into a cool fashion label for the young and hot.

Gen-Z celebrities, like Gossip Girl actor Evan Mock, were surrounded by rows of students and other young fashion obsessives, dressed like characters straight out of “Euphoria” in candy-coloured suiting and sparkling eye makeup.

Just a few hours later at the Diesel store near Milan’s Duomo, the event was already being broadcast on giant screens, positioned next to looks from designer Glenn Marten’s autumn lineup for the brand.

Martens’ take on Diesel harkens back to its height of cool in the early aughts, when it was best known for ultra low-rise — and ultra dirty — washes, with some iterations made to look like the wearer had rolled around in a field of wet grass, or with rips big enough to expose whole swaths of gleaming thigh. His designs recall those days of extreme distress, with the silver foil on a pair of €495 ($486) jeans flaking off for the sake of style. (Collection pieces are mostly priced between €500 and €1,000, a bit higher than the main line, where jeans start at €150.)

At the store, fashion kids rummaged around — like one wearing an Ambush sweatshirt — filing through his €425 sleek-as-a-racecar bags and €795 wrestling belt-style cummerbunds. While many are surely fans of Martens’ work at Y/Project, where he has helped lead the revival of that coarse-but-sexy look of the late 1990s and early 2000s, Diesel gives him another level of exposure and offers a broader range of consumers access to his designs.

Diesel has always been a big business, and the engine of Italian entrepreneur Renzo Rosso’s OTB group— which also includes Maison Margiela, Marni and Jil Sander — generating the largest share of the group’s $1.5 billion revenues last year.

But despite its continued heft, Diesel’s relevance had been waning since the mid-2000s, when its tarnished, overworn look was replaced at the mall by cleaner, darker propositions from the likes of J.Brand and later Frame.

Diesel’s attempts to rekindle the consumer fire—including a four-year partnership with Lady Gaga-collaborator Nicola Formichetti in the 2010s—came as momentum was draining from the premium denim category, as well as the department stores and malls that had championed the category. The brand struggled to reverse the tide, and by 2019, its US subsidiary filed for bankruptcy protection.

Then came Y/Project’s designer Martens, who was originally tapped for a one-off collaboration through the brand’s “Red Tag” programme in 2018.

Two years later, in 2020, as the coronavirus pandemic was making it especially tough for independent designers, Rosso convinced Martens to come aboard as Diesel’s creative director, tasking him with a revamp the company’s product offering and image while continuing to design Y/Project.

The bet on Martens appears to be paying off. While parent company OTB does not break out sales for individual brands, it cited progress on Diesel as a key driver of growth in 2021. Sales rose 16 percent year-on-year, and were flat from 2019. Not extraordinary given the large increases in sales seen by many competitors after the first year of the pandemic, but respectable considering the number of undesirable wholesale accounts Diesel had exited as a part of its repositioning.

As OTB weighs a potential IPO, Diesel’s continued success under new CEO Eraldo Poletto, who joined in July, will remain crucial to the health of the company.

Online, the social media conversation around Diesel has expanded, up 69 percent of the past year, according to tracking firm Launchmetrics. Spikes were attributed to Julia Fox’s Ye-styled Diesel look last February, Nicole Kidman in Diesel on the cover of Perfect magazine in August, and an increase in influencer placements.

Retail partners, too, are increasingly enthusiastic. After exiting scores of underperforming retail locations and discount-prone wholesale boutiques — and sacrificing around €400 million in turnover along the way — the brand is finally winning the high-fashion adjacencies Rosso desires. Just before New York Fashion Week, the company co-hosted a late-night party with upscale independent retailer The Webster at a club in East Williamsburg, celebrating a capsule collection of Glenn Martens’ designs for Diesel, reworked in the store’s in the signature pink.

Laure Hériard Dubreuil, The Webster’s founder and CEO, called Martens’ Diesel an “avant-garde voyage.”

Of course, two collections is rarely enough to change the perception of a brand as big and well-known as Diesel — especially when the entire product offering is much broader than Martens’ vision. But it’s clear that Rosso has hit on something with his new star — the test will be whether the brand can win favour beyond the fervent fashion fan.