Luciano Benetton: Famous fashion to cultural controversy

0:00This BBC podcast is supported by ads outside the UK. When you give to a non-profit, how do you measure success? Many focus on low overhead, but what about real impact on people's lives? For 18 years, GiveWell has researched the highest impact giving opportunities. Over 150 ,000 donors have confidently used GiveWell, saving 300 ,000 lives and improving millions more. Make a tax-deductible donation at givewell.org. First-time donors can have their donation matched to up to$100 while funds last. Select podcast and more or less at checkout. Residents at Brightview Senior Living Communities enjoy enhanced possibilities, independence, and choice.

0:41Brightview, Dulles Corner, and Great Falls offer vibrant senior independent living, assisted living, and memory care services through various daily programs, chef-prepared meals, safety and security, transportation, resort-style amenities, and high-quality care. Take financial possession of your apartment by December 31, 2025 and save. Discover more at brightviewseniorliving.com. Equal housing opportunity.

1:18It's 1993 and we're in a brightly lit photography studio. Everything is white. White walls, white backdrop. In front stands a 57-year-old man with a mane of frizzy white hair. He's wearing round glasses and a grin and he stares straight ahead at the camera. But that's all he's wearing. The man is completely naked. Behind the camera opposite, a photographer encourages him, teasing and joking as only an old friend could. Snap, snap, snap. They've got it. This new campaign image might shock some, but they're used to that. Our model shrugs his suit back on. It's time to get back to the boardroom. Welcome to Good Bad Billionaire from the BBC World Service.

1:57Each episode, we pick a billionaire and find out how they made their money. We take them from zero to their first million, then from a million onto a billion. I'm Simon Jack. I'm the BBC's business editor. And I'm Zing Zing, and I'm a journalist, author and podcaster. And that naked man is none other than Luciano Benetton, founder of the high street fashion brand that bears his name. And for the past 60 years, it's been celebrated for its brightly coloured knitwear. This is a belting episode, I've got to say, which takes in Benito Mussolini, Post War Italy, Formula One, a bit of Dolce Vita, some Vespers.

2:32Princess Diana thrown in. Princess Diana as an influencer. Now, I'm very aware of this brand. It was impossible to miss during the 80s and 90s. It was in your face wherever you looked on billboards. I'm not sure I ever bought anything there, but I was very aware of it. I think I had one or two Benetton jumpers, but I do remember those big shops. And with those, as we'll discuss later, those incredibly provocative, colourful ad campaigns. And you should look them up if you haven't seen them before. They addressed race, religion, AIDS, war, the death penalty. I mean, at the time, this really shocked tons of people and some of the ads were even banned.

3:07But over the last two decades, the Benetton brand has declined to the point of bankruptcy. So is Luciano a good or bad billionaire or just a regular billionaire? Let's travel back in time to find out.

3:22Luciano Benetton was born in 1935 in the small Italian town of Treviso near Venice. Now, this is Italy under the rule of the fascist dictator Mussolini. And when Luciano was just a baby, his father, Leone, left Luciano and his mother to find his fortune as a trucker in Abyssinia, which is now known as Ethiopia, which had been recently invaded by Mussolini. Now, we also have to credit the author, Jonathan Mantle, for his book Benetton, which has been a really valuable source in finding out the history of this fascinating billionaire. But Leone was not a fortunate man. He caught malaria and his truck was stolen.

3:57So he returned to Treviso and started a small bicycle hire business. And soon Luciano got a younger sister, Giuliana, and two brothers, Gilberto and Carlo. Luciano was only four years old when the Second World War began. And amidst the increasing threat of violence, Luciano continued to cycle to school in Treviso. But then in 1944, Treviso was heavily bombed by the Allies. They mistook it for another town where they thought Mussolini was hiding out. Over a thousand inhabitants were killed, but by some miracle, the entire Benetton family survived. I'm still getting over the fact we've got a story with Mussolini playing a large part in it.

4:33Because in April 1945, Mussolini was executed by the Italian resistance. his body famously, along with the bodies of his mistress and his retinue, were strung upside down for public display in Milan. Now a photojournalist called Fidele Toscani took a now infamous photograph of that gruesome scene. Toscani had a young son at home, Olivero, who will go on to become an even more infamous photographer once he teams up with Luciano Benetton. We'll get to that story later. Just a few months before the end of World War II, Luciano's father who never fully recovered from the effects of malaria dies. His mother also develops a serious heart condition that requires long periods of rest.

5:14Luciano later described this time as a tragic period. You could say it was cruel but you lived through it because you hoped things would change. The lesson I learned is that it was possible to fend for yourself. At 10 years old I was no longer a child. So learning independence from really quite an early age. Yeah. To support his family, the young Luciano works part-time, selling papers and delivering bread and soap. We've had quite a lot of our billionaires deliver papers at one time in their life. It's like entry-level job for a billionaire. Yeah, now that, you know, newspapers and print are slowly dying out, you wonder what the billionaires of tomorrow are doing.

5:46What are they doing right now? Anyway, his sister Giuliana begins knitting the family's clothes and takes on extra work sewing in a garment factory. Now, Italy is not the kind of dolce vita place that we might think hark back to now. Now, it was a pretty drab place post-war, clothes were grey, navy, black, burgundy. But at home, Giuliana starts to get creative. She's sewing brightly coloured knitted sweaters for her family. And a bold yellow sweater she makes for Luciano was particularly admired. You can just imagine how much that yellow jumper would have popped. It's like sort of like the black and white TV suddenly.

6:20Yes, exactly. Because poverty was really rife in post-war Italy. So the houses were emptied of possessions, you know, staple foods like pasta became a luxury, if you can imagine that. At only 14, Luciano quit school to get a full-time job. He became a sales assistant in a clothing store run by the De La Siega brothers. Now, this isn't the kind of clothing store we might recognise today. Very old-fashioned. The clothes are hidden away. There's only a few examples in the shop window. And customers instead describe what they wanted to the sales assistants, who then went off to try and put together an outfit.

6:53it. This is time consuming, often resulted in customers being presented with clothes they didn't actually want or like. And browsing without something specific in mind was pretty much impossible. I cannot imagine this ever being a shopping experience that existed. I can sort of. What look are you going for, madam? It puts so much power in the hands of the shop assistant. You can see how people became tyrants. Well, I think shop assistants were quite tyrannical in those days. Even I remember sitcoms from my childhood where the sales assistants were very judgmental about the customers who had come in and tell them what they should wear.

7:26I mean, in one way, you can kind of understand how the high street became seen as this democratization of fashion where anybody could buy whatever they wanted. Yeah. But as the 1950s roll on, things began to change. Exactly. Luciano began to notice a new kind of customer coming into the shop. So they were younger, they had a bit more leisure time, they had at least some disposable income. Because the economy of Italy was recovering in 1954 Fortune magazine reported that Italy's industrial production had risen 50 % above its pre-war base. So the exports from Italy were changing, things like olive oil, cheese, wine, all of those declined.

8:03But fashions and fabrics were rising rapidly. Made in Italy had become a stamp of excellence. To this day, if you're a bloke and you see a shirt which is made in Italy or a tie made in Italy, you think, oh, OK. Yeah, we're talking business now. Well, as a young man, Luciano was interested in clothes. He dressed himself in a sharp suit he bought with his new wages. He even made his own bow tie, which was red, green, yellow, blue stripes on white that he made by borrowing needle and thread from Giuliana. Now, when he wore the tie to work, the De La Siaga brothers told Luciano, it's original as tastes go.

8:37Ouch. But you're a salesman, not a clown. I never want to see it in the shop again. I mean, it sounds like he was doing the absolute most with that needle and thread. Well, it also just shows that he's got a provocative streak in him, which will be evident throughout this story. He imagined a new kind of clothes store, one for people like him, where they could browse new fashions, spend their own money and come back time and time again. He would later say the traditional shops were destined to die and we killed them. So in 1955, Luciano and Giuliana, aged just 20 and 18, decide to go into business.

9:10He was a natural salesman. She had the creative spark, but alas, they had no money and the knitting machine they needed was not cheap. So it was 300 ,000 lira, which was around$200 at the time. But to put that into context, that was almost a year's annual wage in Italy. Yeah, so big money. To raise that money, Luciano sells his beloved accordion, while his little brother Gilberto sells his bicycle. They borrow the rest from relatives and friends. And when the sewing machine arrived at their home, they actually threw a party for it as if it was a new member of the family. I love that. Luciano collected wool from suppliers on his bike.

9:45Giuliana knitted till midnight. Her mother ironed the sweaters. So this was a real family affair. And within a month, Giuliana produced her first collection, 20 knitted sweaters. The style was typical, but the colours were not. So the sweaters were in green, yellows, pale blues. These colours were not seen in drab post-war life in Italy. And they called the collection Tres Jolie. Very pretty. Luciano sold the first sweater to a neighbouring grocer, Mr. Zucchello. He described the feeling he had in this moment as the same intense feeling as a scientist whose theory has just been proved correct.

10:19Eureka! Yeah, he had that moment when he realised these things could sell. And his employers, the De La Ciaga brothers, were impressed. They placed an order for 600 of these sweaters. So the Benetons were able to buy several sewing machines and employ a handful of young women from the neighbourhood to sew them. And over the next few years, this business grew steadily. They sold their designs to more and more Italian retailers. Luciano no longer needed his day job. he was able to hand in his notice with the Dele Sieger brothers. But before he left, their store changed his life in one more way. Yes, it was on the shop floor that he met his future wife, Teresa, who was attracted to this tall, dashing sales clerk.

10:58After they married, she joined the family business and she went to work with Giuliana Benetton. OK, by now it's 1960 and Luciano is visiting Rome as it hosts the Olympic Games. Now, Luciano is blown away by what they call Il Boom, this post-war Italian economic miracle. And if you think about the movies and the scenes from this time, I'm thinking Dolce Vita, I'm picturing Sophia Loren in a sort of headscarf and glasses. Everyone going on Vespas. Vespas or in a little Alfa Romeo. And the appetite for consumption meant as the 1960s progressed, Tres Jolies, the brand they had, grew from a collection of just 20 jumpers made at home and delivered by bicycle into a professional business with rented factory space, manufacturing tens of thousands of jumpers every year.

11:45And Luciano kept selling, but with sales reaching 100 ,000 sweaters a year, they quickly ran into a problem. They were at capacity with the factory space they rented. It just couldn't deal with this number of orders. So Luciano decided to build his own brand new state-of-the-art factory. And to pay for it, he used the profits from their booming sales, plus bank loans that were hard won by his little brother, Gilberto, who by this point had become the financial brains of the whole business. And they built themselves a spanking new modern factory, air conditioning. And crucially, this factory gave them the novel ability at that time to dye an entire sweater in a vat.

12:21And that drastically sped up how quickly they could get their products into the shops. Most clothing manufacturers can only really guess what colours will sell well. So if, say, a yellow sweater sells out, they can't produce extra supplies quick enough to keep up with this trend. but the new manufacturing technique meant that they could respond to trends within 10 days compared to a month for their rival brands. So this is an earlier incarnation of what we would call fast fashion now and if you look at the people like H &M and those kind of stores they pride themselves on being able to respond to market trends in days rather than weeks now and that's one of their big competitive advantages and Luciano called this raising fashion from the artisanal to the industrial level And it wasn't just Benetton's genius.

13:05He was exploiting the environment around him. Benetton was one of many businesses in the region capitalizing on a rich artisan tradition combined with an excess of labor due to shrinking agricultural production. Remember, we talked about things like olive oil and art and cheeses and all that kind of stuff were in decline. So there's plenty of spare workers. And this formula combining fashion with industry and technology, that was, if you like, the sort of secret sauce for Benetton's success. So they now have the production capacity to take a leap from just being the manufacturer of clothes to being the retailer in their own right, to being the people who sell those clothes.

13:38A year earlier, Luciano had been approached by a man named Piero Machiorello. Piero worked in his father's small clothing store in a town called Belluno, not far from Treviso. And on a trip to Rome, Piero had admired the Treasurer Lee's designs in a shop window. And just two days later, he turned up at Luciano's door with a bold proposal. So he said, I want to open a shop exclusively selling your clothes. I have no money and no experience. But if you trust me, I know we will be successful. That is quite the elevator pitch. What a pitch. I've got no money, no experience, but I'm sure it's going to work.

14:10Anyway, Luciano was excited by this idea. There had never been a one brand, one product shop like this before. It's kind of hard to imagine that now, isn't it? So he makes a deal with Piero that Piero would buy exclusively from the Benetons and keep the profits on a no return basis. so I know I know the stuff you can't sell back at again. The Benetons loan Pierrot some money and along with the bank loan, Pierrot opens his store. This is basic franchising and is the key to Benetons' success. Now franchising is where, and it happens all over the world at the moment, like McDonald's is a franchise thing, where basically McDonald's, for example, doesn't own the restaurant or operate the restaurant.

14:50An independent person does that. I just supply them all of the stuff they need, ovens, the food, the branding, the menus, but you run it as your own business. So I don't have really the overheads of running the business and you're bearing some of the risk, but you're the distribution network. That's kind of franchising how it works. Yeah. And if you're the one setting it up in, you know, as Piero is, you have the brand, you have the goods, you don't need to go around trying to fill your shelves yourself. Yeah. It's an interesting one because although you lose a little bit of control because you're not actually running the store yourself, It's a passport to fast expansion because you're getting lots of other people to open the stores for you.

15:27Well, the first store that Piero opened was in a Denon Street in a quiet part of his town in Belluno. Luciano called it the worst site I've seen in my entire life. But Piero was optimistic. If it works here, it'll work anywhere. You need that kind of optimism, I think, if you want to start a business. That store opened in 1965, drawing on inspiration from swinging London. They gave the store an English name. They called it My Market. It was painted white, brightly lit. The clothes were displayed in waves of colour. A far cry from the department stores we encountered at the beginning of the story.

15:59Yeah, it was enticing people in. And the store was an instant success in this quiet town. Young people just flocked to it. They were excited at being encouraged to browse the clothes without the pressure to buy from those shop assistants we talked about. And franchise stores quickly followed in Cortina, which is a fashionable ski resort town in the university town of Padua. and there were young customers there queuing up around the block to get in. So a very early version of the kind of queues you now see outside stores such as Supreme or Stossi in London. Yeah, so Luciano was perhaps understandably feeling pretty confident.

16:32So he dropped the name Très Jolie and replaced it with his name, Benetton. But it would be several years before the family name graced the front of its franchise stores. Luciano didn't want the Benetton brand damaged if my market proved a failure. But he needn't have worried. My market shops are spreading to Italy's major cities, Rome, Florence, Naples and Trieste. These franchises were largely run by people who had visited the original three shops and they saw that retail could be fun. They wanted in on this kind of revolution. But Luciano decided he would no longer raise funds for these new shops to open.

17:08Budding entrepreneurs had to do it themselves. This is the franchising model. It's interesting, isn't it? This idea of retail becoming an experience, a pastime, something to do, a hobby almost. With the success of these franchise stores, Benetton stopped supplying independent retailers, so they wouldn't sell bits of their product to be in one corner of somebody else's shop. Instead, they developed new stores to sell a bigger range of products. Merceria was a gentler experience, more traditional, with classical music to appeal to the older female customer. There was Tomato, that was aimed at teens, while Fantomax lent into hippie culture.

17:43These stores would often compete in the same towns, and I guess it's better to compete with yourself than with others. Within a year, there were 300 stores that sold Benetton clothes exclusively. You know what this reminds me of? This reminds me of what Inditex, which own Zara Kids, Zara Home, you know, all these kind of diffusion lines in a way that are still kind of offshoots of the main brand. I think Inditex also own Pull & Bear. There's this illusion of choice on the high street when in fact they own quite a lot of these brands. All this meant that by 1969, the family was wealthy enough to buy the grand 17th century Villa Minnelli near Treviso.

18:17It had been abandoned for over 150 years. So not surprising the renovation took over 15 years to finish, but it remains Benetton's headquarters today. And Luciano was also busy growing his own family. By the end of the 60s, he and Teresa had four children together, Mauro, Alessandro, Rosella and Rocco. Fortunately, he was making enough money to provide for this big family. And we think that it is around 1970 that Luciano became a millionaire. Now, it's hard to get exact figures as it was a privately run business. But at the start of the 70s, they went from dozens to hundreds of stores. So it feels pretty safe to say at this point he is a millionaire.

18:54Luciano Benetton is a millionaire.

19:10Travel is one of the best ways to discover yourself through experiences, making rich memories, the heightened emotions and deep connections. And with EF Ultimate Break's biggest sale of the year, there is up to$1 ,000 off trips to Japan, Italy, Greece, Thailand, Egypt, Kenya and beyond, which you can lock in for just$99. Build lasting friendships, forever change how you see the world, and just have the time of your life. Visit EFUltimateBreak.com This is Steve Covino from Covino & Rich. Here to tell you, Toyota's legacy has been standing tall for generations. From pioneering hybrid technology to redefining the standards of safety and efficiency.

19:51With each innovation, a commitment to progress. And with a legendary lineup of in-stock trucks, including the ultra-rugged new Tacoma and heavy-duty half-ton Tundra, you can experience the legacy of Toyota for yourself. Visit buyatoyota.com, the official website for deals, to find out more. Toyota, let's go places. Residents at Brightview Senior Living Communities enjoy enhanced possibilities, independence, and choice. Brightview, Dulles Corner, and Great Falls offer vibrant senior independent living, assisted living, and memory care services through various daily programs, chef-prepared meals, safety and security, transportation, resort-style amenities, and high-quality care.

20:30Take financial possession of your apartment by December 31st, 2025 and save. Discover more at brightviewseniorliving.com. Equal housing opportunity. Running a business is hard enough, so why make it harder with a dozen different apps that don't talk to each other? One for sales, another for inventory, a separate one for accounting. Before you know it, you are drowning in software instead of growing your business. This is where Odoo comes in. Odoo is the only business software you'll ever need. It's an all-in-one, fully integrated platform that handles everything. CRM, accounting, inventory, e-commerce, HR, and more.

21:08No more app overload. No more juggling logins. Just one seamless system that makes work easier. And the best part? Odoo replaces multiple expensive platforms for a fraction of the cost. It's built to grow with your business, whether you are just starting out or already scaling up. Plus, it's easy to use, customizable, and designed to streamline every process. so you can focus on what really matters, running your business. Thousands of businesses have made the switch, so why not you? Try Odoo for free at odoo.com. That's O-D-O-O dot com.

21:47So let's take it to the 70s. They were all about Benetton's franchise stores expanding throughout Europe, and in each country they adapted their offering to local taste. So by the end of that decade, there were 1 ,700 stores across the continent. Astonishing fact, Benetton was now the largest consumer of wool in the world. They were also diversifying into denim. The world was now wearing jeans, including Luciano himself. So they acquired French denim fashion company Sizzly. It was in one of Luciano's jean stores that he met an employee called Marina Salomon. She was in her early 20s, about to attend university in London.

22:23He was in his 40s at the time and he fell for her instantly and he flew to London to begin an affair. After several months, Luciano came clean to wife Teresa. She ended their marriage. He moved out of the family home and in with Marina. Luciano and Marina would stay together for almost two decades and have a son, Brando. He would also help her set up her own luxury fashion group. But let's get back to the 80s. Luciano and Marina are in love and he's about to expand his empire beyond Europe, opening the first stores in New York City and Tokyo. Benetton was the hot brand at the time. Celebrities like Sylvester Stallone, Dustin Hoffman, Jackie O all visited the New York stores.

23:06And in London, Lady Diana Spencer, who was then the fiancé of Prince Charles, was photographed stepping out of a Benetton. So this is amazing because, I mean, I feel like Diana at the time was a proto-influencer. Oh, for sure. I'm struggling to see Sylvester Stallone in a yellow sweater, I've got to say. I can sort of see it, but Diana I can see indefinitely in a Benetton knitted jumper. She was, you know, notorious for those. And as we'll see, she was super progressive on some of the issues that Benetton was also interested in. And so, I mean, she's a perfect fit and a very powerful, probably the most famous woman in the world at that time, I would say.