The Diesel engine is on fire

Livemint.com Fri // May 7 2010 // by Rachana Nakra

Diesel’s Renzo Rosso sold his first pair of handmade jeans for $2 (around Rs89 now) in Italy. The founder and president of the iconic denim brand made the pair with 2m of denim, using his mother’s sewing machine, when he was 15. He dipped the denim in bleach to lighten the shade of blue. “I don’t know why, maybe because the denim was stiff, but I took the jeans and did this,” he says in his heavily accented English, mimicking the motion of placing the jeans on the floor and scrubbing them.

The first distressed denim was born and worn by Rosso’s friends. “That would give me money to go out at night and drink. This was 40 years ago, can you imagine?” Rosso says.

Four decades later, Diesel has set up its flagship store in Mumbai, the first in India. I meet the man behind the brand in Juhu on the day of the store launch. He is here on a short visit and this is the first time he has stepped into the store. Dressed though he is in a dark shirt with a black blazer and, of course, jeans, it may seem that Rosso needs a haircut and shave. But the unruly mop, the three-day-old beard and unbuttoned shirt that reveals a silver pendant bearing his initials, all add up to the casual and cool look that’s quintessentially Diesel.

Rosso has partnered with Reliance Brands Ltd to bring Diesel to India. Darshan Mehta, CEO, Reliance Brands, is also at the 7,500 sq. ft store, showing Rosso around.

For the company that created a market for new jeans that looked old, something that may have sounded stupid turned out to be a smart idea. In fact, Diesel’s latest advertising campaign is asking people to “be stupid”—right from the signs at the entrance and as a running theme inside. “Smart may have the brains, but stupid has the balls,” says one of them.

As a Diesel philosophy, no two stores in any part of the world can look the same—the displays and merchandise are different. Rosso is happy with the look of the Mumbai store but he still doesn’t think it’s complete. “This is me. Even when a new collection is coming out, I never say, wow, this is fantastic. It could be better. It’s kind of a malady. You want to achieve perfection,” he says, sipping his espresso on a white couch on the first floor of the three-storey store.

The Diesel story began in Italy when a friend offered Rosso a job as production director of a small company manufacturing jeans. In 1978, he created Diesel, starting with his own line of distressed jeans. He named it that because it was easy to pronounce the world over. “Everyone was shocked with my idea to sell distressed jeans 32 years ago. Nobody understood it. They make broken denim? They must be crazy. We had few customers,” he says. But Rosso was convinced: “I defend my opinion, and developed the concept till one day, it became a part of every luxury line everywhere,” he says, smiling.

Denim before Diesel was a symbol for rebels, feels Rosso. It wasn’t fashion. Diesel made denim fashionable. “Premium will become important, because premium is more real and less expensive than luxury denim,” he says. Now, with its headquarters in Molvena, Italy, Diesel is present in around 80 countries, with 5,000 points of sale, and had a turnover of €1.3 billion (around Rs7,579 crore now) in 2009. The hardest nut to crack was the US. How do you take denim to a country that took denim to the masses, is the birthplace of iconic denim brands such as Levi’s, and then sell it at a higher price?

“No one accepted our price. We would sell jeans at about $62-64.” Their first licensing agreement with an American company had to be terminated because it started manufacturing cheaper denim. The second one went bust because the company it partnered with went bankrupt. “I don’t know if I was being brave or stupid but I decided to keep the employees and start over. I called friends for advice and apologized to old customers. I couldn’t afford any more mistakes,” he says.

In 1992, they came up with the Diesel for Successful Living advertising campaign. The campaign made a mockery of American advertising, which promised to improve your life. Rosso says he is a big fan of irony and the Be Stupid campaign is only the latest in a series of advertising campaigns that have pushed the envelope. “At that time, all the advertising looked same. Our campaign came as a shock to everyone,” he says.

The US market was unexplored territory then. So is India now. Although there are many Diesel loyalists in the country, buying their perfect fit while travelling abroad, premium denim is still an alien concept for most. How can he justify a price tag of $500 for something that’s available to the Indian consumer at $50? “If you bring 10 different jeans from different brands right now I can show you so many detailing Diesel has that others won’t. You will continue to discover them many months after buying them,” he says.

He lifts his shirt to show me the double belt loops, one each for a big and small belt, and then points to droplets of white paint, a detailing done by hand. “The finishing inside, the kind of treatment that goes into making a pair, every piece is different. We have special machines to do our hip. It is not straight but like this,” he says, making a half-moon in the air with his finger. “It’s difficult because you have to train people to work in a different sort of way. It gives you more volume and the butt is…”—he explains the rest with his hand gestures.

Rosso and Mehta hope to open seven stores in India this year and 22 within five years.

Over 30 years have passed since the brand was launched, but Rosso and Diesel continue to remain relevant to their target market—the youth. He says his biggest strength as a businessman is innovation.

“Stupid sees things as they can be and not as they are,” says a poster from the Be Stupid campaign. Rosso says he could get ideas from anywhere. “When I am on the Web, when I am talking to you, could be in the restaurant, in the disco, in the street, anywhere. I take pictures and I read 200 magazines from all over the world,” he says.

He makes sure that he and his employees have a lot of fun. Rosso divides his free time between his farm, playing football and doing yoga. “I go to pubs, disco, drink, enjoy and in other free time, I am also making sex. I am very social, no?” he says, laughing. He has six children with his ex-wife and lives in Bassano del Grappa in Italy. He has people who have taken over the finance and logistics of running the company, leaving Rosso free to work in the creative space.

For someone advocating being stupid, what is the stupidest thing he has done? “So many. First, to have a name like Diesel. Now it’s cool, but in the beginning, for a clothing line to be called that, was not. To decide to enter the US market. And to decide to make all Diesel stores different. It’s easy to make it same like a chain, but this is my way to run business,” he says