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Rosso credits his hardscrabble upbringing on the farm for his determination and pragmatism, including a meticulous attention to logistics widely admired by competitors. Plus he has a real flair for marketing. Today Diesel is still less than half the size of the Levi's brand (a separate high-end manufacturing division, Staff International, does an additional $114 million in sales), but it's fast growing, highly profitable and so far has managed the delicate balance Renzo evokes when he says his goal is to be the "coolest of the biggest."
That's the favorite Renzo-ism at L'Oréal, the French beauty giant that beat out rival Proctor & Gamble for rights to develop a Diesel fragrance next year. "We adore working with him, and we believe very much in the project," says Patricia Turck Paquelier, L'Oréal's international-brand president for designer fragrances. "But it will be a major investment for us, so we validated our intuition with research." What appealed to L'Oréal in the findings was Diesel's international positioning. Consumers perceive European styling with what she called a "think-positive, go-for-it" American spirit; young consumers perceive that "jeans are forever" and identify Diesel as sexy, creative, good quality.
Diesel continues to be seen as an innovator (Rosso claims to have developed many of the manufacturing innovations for denim) in one of the most dynamic corners of the fashion cosmos, the jeans bar, where consumers are falling over one another to pay $150 or $200 a pair. That is a recent phenomenon. Jeans were long considered a $30, five-pocket commodity, with connotations of youth, rebels and weekends in the Western world. Periodically, prices spiked for so-called designer jeans (think Calvin Klein in 1980). But those remained a status sell focused on pocket stitching and the tag; most proved to have short life cycles.
Rosso's big idea was to improve the product and the margins. (He had road tested the first part of that formula as a teenager selling friends $7 jeans he made on his mother's sewing machine.) In 1988 he hired a young Dutch fashion-school grad named Wilbert Das, and they began to experiment with dyes and destruction—all sorts of techniques to age the jeans and give them a more vintage feel. They moved pockets, reshaped the jeans, introduced curves—and then charged a whopping $79. Their look was Rosso's look, a blend of thrift store, Americana and '50s B movie. At first, retailers balked, so Rosso promised to take back anything they couldn't sell, an offer he claims he never had to make good on.