PARIS — Galeries Lafayette on Wednesday unveiled a new visual identity aimed at reconquering its domestic audience amid a tepid recovery in Europe’s second-largest economy.
The French department store chain posted revenues of 1.7 billion euros, or $1.89 billion, in the first half of 2015, roughly stable versus the same period last year, said Nicolas Houzé, chief executive officer of Groupe Galeries Lafayette’s department store division.
Its flagship on Boulevard Haussmann accounted for the bulk of business, with revenues up 3.5 percent during the period. The rest of the network, consisting of 58 stores in France and five overseas, posted a 0.5 percent drop in turnover in the first six months of the year, he added.
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The family-controlled retailer does not disclose full financial results.
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“The first half was globally in line with our targets and the second half so far seems to be following the same trend. We continue to invest some 100 million euros a year in our stores and we are accelerating our transformation,” Houzé told reporters gathered in a personal shopping suite at the Paris flagship.
The executive said that Galeries Lafayette maintained its target of doubling its profitability in the next five years, as set out in its transformation plan titled “Ambitions 2020.”
Its new logo, designed by Paris-based creative agency BETC, was unveiled at the Boulevard Haussmann store and will be rolled out to the rest of the network by year-end. Its bold calligraphic style is designed to capture the spirit of the new advertising campaign, with its tagline: “The New Chic.”
As reported, the retailer last year parted ways with photographer Jean-Paul Goude, who had shot its advertising campaigns since 2000, producing memorable images featuring personalities including Jean Paul Gaultier and Pedro Almodóvar.
The new campaign, designed by global creative agency Wednesday, features a group of style ambassadors including ballet dancer Marie-Agnès Gillot, chef Pierre Jancou, television presenter Mademoiselle Agnès and musician Gabriel-Kane Day-Lewis. The initial outdoor, print and digital campaign is set to run until Oct. 6.
Guillaume Houzé, director of image and patronage at Galeries Lafayette, said the retailer’s new image was designed to emphasize its French roots, with the aim of appealing to both tourists and locals, who each account for roughly half the customer flows at the Paris flagship.
“Even if we have a lot of foreign customers at our Boulevard Haussmann store, the French remain the top client group at the store. One of the things at stake is winning back our Parisian base,” he said.
“Foreign customers are a big presence at the Boulevard Haussmann store today and we have to improve the way we manage flows, in particular on our ground floor. This flood of tourists, from Asia in particular, can intimidate some of our Parisian friends,” he added.
The retailer plans to address the issue next year, when it will launch a wide-ranging renovation of the main building of its Paris flagship, following the recent revamp of its Lafayette Gourmet and Lafayette Maison divisions and the ongoing upgrade of its men’s department.
Nicolas Houzé noted that spending by French customers at the Boulevard Haussmann store was down in the first half of the year.
“These are times of crisis and French consumers are having to make choices, and the type of products we sell are often easy to go without. Our Parisian customers are facing the same problems as the rest of France,” he said.
Galeries Lafayette is in talks with French retail group Vivarte to take over the store currently occupied by high street chain La Halle on Boulevard Haussmann to relocate some of its activities during the renovation.
“Rethinking the design of this store has become essential. It will be a very vast and complex undertaking, since the Boulevard Haussman store is the locomotive of Galeries Lafayette,” he added.
Another thorny issue is the subject of Sunday openings. Although the government has pushed through a law that should result in Boulevard Haussmann being declared an “international tourist zone,” capping years of lobbying from Galeries Lafayette and neighboring store Printemps, the plan faces opposition from labor unions.
Nicolas Houzé said the store was waiting for the outcome of the negotiations that have just begun between the Union du Grand Commerce de Centre Ville (UCV), which represents department stores, and labor representatives. If these fail, it will launch direct talks with the unions.
The executive forecast that opening 52 Sundays a year would create 1,000 jobs at the Paris flagship alone and help the group achieve a 5 percent to 7 percent increase in revenues. He refused to consider the possibility that the negotiations would fail.
“We can’t imagine that with our potential classification as an international tourist zone, we won’t be able to open on Sundays,” he said.
As part of a drive to reduce fixed costs and find new revenue streams, Galeries Lafayette is to close three money-losing stores in France this year and plans to open an additional four outlet stores nationwide within the next two years, following the successful launch of its pilot unit at the One Nation mall near Paris, open since October 2014.
It plans to open a store on the French capital’s Avenue des Champs-Élysées in 2018 in the space formerly occupied by a Virgin Megastore.
The retailer, which has branches in Marrakech, Dubai, Berlin, Beijing and Jakarta, Indonesia, is also scouting for new international locations, with openings planned in Istanbul and Doha, Qatar, in 2017 and Milan in 2018.
“Our target as part of ‘Ambitions 2020’ beyond those three openings is to find seven other locations to open stores, namely in Asia and the Middle East, which are our priority zones for international development,” Houzé said.
Galeries Lafayette, which aims to become France’s omni-channel reference for fashion, relaunched its Web site in May and expects online sales to account for 2 percent of its revenues in 2015.