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Department Stores - France - April 2016

OVERVIEW
What you need to know
Areas covered in this report
EXECUTIVE SUMMARY
The market
Spending and inflation
Department stores’ share of clothing and beauty markets
Figure 1: France: Estimated retail distribution of spending on clothing, 2014
Figure 2: France: Estimated retail distribution of spending on beauty and personal care goods, 2014
Sector size and forecast
Leading players
Key metrics
Market shares
Figure 3: France: Department stores’ share of mixed goods retailers’ sales, 2012 and 2015
Online
The consumer
Where they shop
Satisfaction levels
Figure 4: France: Department stores used most often, satisfaction with various criteria, March 2016
What we think
ISSUES AND INSIGHTS
Struggling provincial stores
The facts
The implications
Need to invest in online operations
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Consumer spend held back by high unemployment
Department store sector sales remarkably resilient
Department stores’ share of clothing and beauty markets
SPENDING
Figure 5: France: Spending on key department store product markets, (incl. VAT), at current prices, 2010-
15
Department stores’ share of clothing and beauty markets
Clothing
Beauty
SECTOR SIZE AND FORECAST
Department store sector size
Figure 6: France: Department stores, estimates sector sales (excl VAT), 2011-15
Mixed goods retailers sector
Figure 7: France: Mixed goods retailers’ sales (excl. VAT), 2010-15
Figure 8: France: Mixed goods retailers’ sales forecasts (excl. VAT), 2015-20
LEADING PLAYERS – WHAT YOU NEED TO KNOW
A third consecutive year of falling sales for Galeries Lafayette
Ramping up flagship store investment
Market share gains in 2014 drop off in 2015
LEADING PLAYERS
Galeries Lafayette’s performance deteriorates
Multi-million euro flagship store makeovers
Figure 9: France: Leading department stores retailers’ sales, 2011-15
Figure 10: France: Leading department store retailers, store numbers, 2011-15
Figure 11: France: Leading department store retailers’ annual sales per outlet, 2011-15
MARKET SHARES
Gains made in 2014 lost in 2015
Figure 12: France: Leading department store retailers’ shares of mixed goods retailers’ sales, 2012-15
ONLINE
Online activity
Leading online players
THE CONSUMER – WHAT YOU NEED TO KNOW
Low usage of department stores
Customer profile is young and affluent
Online offer needs to be improved
WHERE THEY SHOP
Figure 13: France: Department stores visited, in-store or online, March 2016
Figure 14: France: Profile of department store shoppers, March 2016
SATISFACTION LEVELS
Figure 15: France: Department store used most often, satisfaction with various criteria, March 2016
Figure 16: France: Galeries Lafayette and all other stores, satisfaction with various criteria, March 2016
GALERIES LAFAYETTE
What we think
Investing for the future
Revamping Haussmann store after 15 years
Shuts stores but French regional profitability remains a problem
France still offers opportunities
Online still small and targets remain modest
Revamping own label could have dual benefits
Overseas store plans ambitious but upside limited by franchise model
Company background
Company performance
Figure 17: Galeries Lafayette (Group): Group sales performance, 2010-15
Figure 18: Galeries Lafayette: Outlet data, 2010-15
Retail offering
LE BON MARCHÉ
What we think
Stylish department makeovers helping drive revenue growth
La Grande Epicerie de Paris to launch own-label range of gourmet food
Exclusive brands and experiences strengthen destination status
A must-see cultural tourist icon
24 Sèvres helping to attract a younger clientele
Company background
Company performance
Figure 19: LVMH Selective Retail, financial performance, 2011-15
Figure 20: Le Bon Marché: Estimated sales performance, 2011-15
Figure 21: Le Bon Marché: Outlet data, 2011-15
Retail offering
PRINTEMPS
What we think
Stay-away high-spending tourists and stay-at-home French shoppers
150th anniversary campaign reinforces Printemps brand image
The largest menswear store in the world expected to be a big draw
M-commerce an opportunity to engage and connect with a younger audience
Sunday opening hours negotiation deadlock robs Printemps of additional revenue
Company background
Company performance
Figure 22: Printemps: Estimated group financial performance, 2011-15
Figure 23: Printemps: Outlet data, 2011-15
Retail offering
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Data sources
EUROPEAN RESEARCH METHODOLOGY
Sample sizes by demographics and geographies
Our research partner – Lightspeed GMI

Department Stores - France - April 2016

“The department store sector put in a resilient performance in 2014, at a time when the domestic economy was weak. However, much of this was down to the groups’ flagship stores in Paris attracting wealthy international tourists, which masked lacklustre trading at stores outside of Paris. The French economy grew at its fastest rate in four years in 2015. It should have been a boom time for department stores, but it wasn’t. Sector sales struggled as the terrorist attacks kept tourists away. Sales may also be being dampened by dissatisfaction with aspects of the stores’ multichannel proposition.”

– Stephen Mayles, Retail Analyst

This report discusses the following key topics:

Struggling provincial stores
Need to invest in online operations


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