Ris­ing Fo­cus on French Start-ups

Ker­ing, Ga­leries Lafayette and Car­refour are among large com­pa­nies broad­en­ing their em­brace of start-up cul­ture.

WWD Digital Daily - - News - BY MI­MOSA SPENCER

PARIS — As the re­tail land­scape changes at an ever-quick­en­ing pace, a wide range of French groups are in­creas­ingly turn­ing to start-up cul­ture for their own de­vel­op­ment, from highly prof­itable lux­ury groups look­ing to re­duce their en­vi­ron­men­tal im­pact to re­tail­ers re­think­ing their mod­els in or­der to stay rel­e­vant.

Fur­ther en­cour­age­ment comes from the gov­ern­ment, led by French Pres­i­dent Em­manuel Macron, who was elected on a plat­form that fa­mously in­cluded a pledge to trans­form France into a “start-up na­tion.” Macron, whose pop­u­lar­ity is flag­ging, vis­ited Sta­tion F, the start-up campus in Paris, on Tues­day, where he spoke to 2,000 en­trepreneurs about at­tract­ing tal­ent France.

For Ker­ing, which has po­si­tioned it­self as a fore­run­ner on the sus­tain­abil­ity front in fash­ion and re­tail, in­no­va­tion is key for the lux­ury goods be­he­moth to reach its goals in the field. The group has topped a num­ber of rank­ings on the sub­ject, in­clud­ing three times at the head of the Dow Jones Sus­tain­abil­ity In­dex for its cat­e­gory.

A found­ing mem­ber of the Plug and Play, Fash­ion for Good start-up ac­cel­er­a­tor in Am­s­ter­dam, Ker­ing added its sup­port to the ChangeNow sum­mit held re­cently at Sta­tion F. The gath­er­ing brings to­gether peo­ple to dis­cuss so­lu­tions for press­ing global is­sues in­clud­ing plas­tic pol­lu­tion, ed­u­ca­tion, refugees and clean en­ergy.

Ker­ing has pledged to re­duce its en­vi­ron­men­tal foot­print, which it mea­sures through an en­vi­ron­men­tal profit and loss ac­count, by 40 per­cent by 2025.

“To­day, if we man­age to de­velop at a group level all of our pi­lot projects that we have started in raw ma­te­ri­als, like cash­mere, cot­ton, wool, or in terms of pro­cesses, like tan­ning with­out heavy met­als, we will man­age to re­duce our en­vi­ron­men­tal im­pact by 20 per­cent,” said Ker­ing chief sus­tain­abil­ity of­fi­cer MarieClaire Daveu.

“So if we want to reach this ob­jec­tive of 40 per­cent, we have to have dis­rup­tive in­no­va­tion,” she told WWD.

“In­no­va­tion is truly cen­tral for us — in terms of sus­tain­able de­vel­op­ment — it’s at the cen­ter of our strat­egy and so we try to be present and take con­crete action in dif­fer­ent ar­eas,” she added.

Even if the com­pany set up its own ma­te­ri­als in­no­va­tion lab in Italy in 2013, a hub that counts 3,000 sus­tain­able fab­rics, it is still im­por­tant to be tapped into de­vel­op­ments else­where, or in other sec­tors, that could be ap­plied to the tex­tile sec­tor or lux­ury, she noted.

Speak­ing at the ChangeNow sum­mit, Daveu high­lighted a chal­lenge spe­cific to Ker­ing’s high- end in­dus­try: the need for the high­est qual­ity stan­dards. While there’s a num­ber of promis­ing projects, “the most im­por­tant difficulty we have is to ap­ply this kind of new thing in the lux­ury world,” she added.

For Ga­leries Lafayette, faced with the chal­lenge of rein­vent­ing the depart­ment store model to se­cure fu­ture busi­ness, that en­tails em­brac­ing dig­i­tal tech­nol­ogy, and its Plug and Play ac­cel­er­a­tor in Paris serves as a way to tap into new ideas.

“We can’t do every­thing on our own, but at the same time we can’t say we want to go more slowly, be­cause we are not the ones set­ting the pace,” said Matthieu Caloni, strat­egy and trans­for­ma­tion di­rec­tor for the group. “We need to sur­round our­selves with good part­ners to get there,” he added.

Caloni and Ga­leries Lafayette group chief ex­ec­u­tive of­fi­cer Nicolas Houzé last week wel­comed France’s sec­re­tary of state for dig­i­tal af­fairs Mounir Mahjoubi to the sprawl­ing space that welcomes star­tups tak­ing part in the pro­gram in Paris.

Dis­cussing the new projects with peo­ple work­ing at the star­tups, Mahjoubi said he was work­ing to make it eas­ier for them to re­cruit tal­ent from abroad with a speeded-up process for han­dling work per­mits, as well as broad­en­ing fast-track per­mits from spe­cific pro­gram­ming po­si­tions only to also in­clude web mar­ket­ing po­si­tions.

Also on site for the min­is­ter’s visit was Matthieu Benker­ant, head of in­no­va­tion, ecosys­tems in­cu­ba­tion and ac­cel­er­a­tion at Car­refour, a spon­sor­ing mem­ber of Ga­leries Lafayette’s Plug and Play pro­gram.

The world’s se­cond largest re­tailer af­ter Wal­mart, Car­refour is un­der­go­ing a broad over­haul and has turned to new tech­nolo­gies as the back­bone of its strat­egy to shore up de­fenses against the dom­i­nance of on­line gi­ants Ama­zon and Alibaba.

“Above all, the top­ics cor­re­spond to our short- and medium-term busi­ness needs, and also this re­mains the first and only ac­cel­er­a­tor fo­cused on e-com­merce re­tail,” Benker­ant said. “We were at­tracted to the ac­cel­er­a­tor mind-set of a big group, and ac­cel­er­a­tor ex­per­tise brought to ad­dress the needs of a big group.”

Like Ga­leries Lafayette, Car­refour is faced with the need to adapt phys­i­cal stores to an on­line era.

“The start-ups cor­re­spond to our needs, with real projects we want to put in place,” said Benker­ant, cit­ing blockchain tech­nol­ogy as a re­cent de­vel­op­ment spurred by start-up help. The gro­cer started us­ing the tracing tech­nol­ogy with chicken ear­lier this year, adding toma­toes, sal­mon and eggs, with plans to ex­pand it to more prod­ucts and add ge­olo­ca­tion tech­nol­ogy.

Ex­pe­ri­enced Cap­i­tal Part­ners, a pri­vate eq­uity firm spe­cial­iz­ing in af­ford­able lux­ury that played a key role in the de­vel­op­ment of SMCP group, re­cently held a round­table dis­cus­sion on changes in re­tail, bring­ing to­gether heads of start-ups in the food and re­tail sec­tors, in­clud­ing the un­der­wear la­bel Le Slip Français as well as Ga­leries Lafayette’s Houzé and French gov­ern­ment spokesman Ben­jamin Griveaux.

Driv­ing home the point that Macron’s pri­or­ity is to re­duce the cost of work and lower gov­ern­ment ex­penses, Griveaux fur­ther stressed the need for large groups to adapt to the back­ground of change.

“Large groups in the cloth­ing sec­tor fac­ing dif­fi­cul­ties need to be able to find in­spi­ra­tion from new forms of con­sump­tion….Some were per­haps a bit too stuck in their way of do­ing things with­out call­ing them­selves into ques­tion,” he said.

“In­stead they should re­con­sider their com­mer­cial prac­tices, price po­si­tion­ing, ways of do­ing things, ways of telling sto­ries and gen­er­at­ing con­tent, go­ing on so­cial net­works, ques­tion them­selves about dig­i­tal de­vel­op­ments — in short, rein­vent their busi­ness. That’s not up to the gov­ern­ment to do,” the spokesman said.

Marie-Claire Daveu

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