Galeries Lafayette unveils 400 million euro five year reinvention plan

Business

Galeries Lafayette celebrates its 130th anniversary Credits: Galeries Lafayette

Nicolas Houzé, representing the fifth generation of the Galeries Lafayette family group, has just unveiled his plans for the future, with 400 million euros allocated to modernization and innovation over five years. A bold bet to preserve the growth and profitability of the stores, while responding to the challenges of global competition and changes in consumer habits.

"We will invest 400 million euros over five years," declared Nicolas Houzé, Chairman of the Board of Galeries Lafayette, in an exclusive interview for La Tribune.

Resilience in the face of successive crises

Galeries Lafayette has experienced major turbulence in recent years, between the Yellow Vest protests, the COVID-19 pandemic and the closures imposed due to these crises. However, despite these challenges, the group has been able to resist. Indeed, after losing more than 1 billion euros in turnover during the pandemic, Galeries Lafayette has managed to get back on the path to growth. In 2023, turnover amounted to 3.65 billion euros, with growth of 3 percent at Haussmann and 4 percent for all stores, we can read in Challenges.

Strategic investments for the future

According to Nicolas Houzé, one of the keys to this resilience is the massive investment strategy. “We have invested 400 million euros over five years to modernize our store network, including €100 million for the flagship store in Paris, at Haussmann,” he says. These investments do not only concern digital aspects, but also more tactical elements, often invisible to customers, such as escalators or air conditioning. One of the most visible transformations was the renovation of the historic dome of the Haussmann store in 2021, recalls Reuters.

The group plans to continue on this path, with similar investments over the next five years. “We have also rethought the integration of brands into the customer journey, taking into account the specificities of different nationalities,” says Nicolas Houzé. At Haussmann, the store now offers nearly 2,000 brands spread over 70,000 square meters.

An evolving model in the face of global competition

The department store sector is experiencing challenges worldwide, particularly due to the rapid evolution of retail. Department stores are facing new challenges, including the emergence of hypermarkets, the rise of luxury shopping malls and the development of e-commerce. These developments have profoundly changed consumer habits.

However, the Galeries Lafayette model stands out for its ability to reinvent itself. "You have to differentiate yourself to remain desirable," explains Nicolas Houzé. The group is banking on the "premiumization" of its offer, a multiplication of services and increased personalization of the customer experience. Digitalization, artificial intelligence and technological innovations are at the heart of this transformation.

Return of international customers and international expansion

Galeries Lafayette has also seen a return of Asian consumers, particularly Chinese, who were a key clientele before the pandemic. Today, 40 percent of Haussmann's customers are French, 20 percent Chinese and 40 percent come from other nationalities. "The Haussmann store, our flagship, is a real world store, frequented by customers from all over the planet," Nicolas Houzé emphasizes.

The group plans to strengthen its international presence, with expansion plans in China, Indonesia and the Middle East, according to Reuters. In 2025, a store will open in Mumbai, followed by another in New Delhi in 2026, to support growing demand from the Asian market.

Significant transformations at Haussmann

Among the notable developments at Galeries Lafayette in recent years, Nicolas Houzé mentions the creation of a “well-being” area in the basement of the Haussmann store, as well as the redesign of the space dedicated to shoes. The group has also welcomed the famous American toy brand FAO Schwarz in a space of 5,300 square meters on the fifth floor. In addition, a major modernization project of the Men’s building is planned for next year.

Galeries Lafayette continues to redefine the shopping experience, offering innovative concepts while strengthening its leading position in the retail sector.

Despite the difficulties faced by the department store sector, Galeries Lafayette has managed to maintain its attractiveness thanks to a bold strategy of investments and transformations. The family group favours differentiation and innovation, positioning itself for a solid future, strengthening both its presence in France and internationally.

This article originally appeared on FashionUnited.FR, translated and edited to English.

It was translated using an AI tool called Gemini 1.5. .

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