François-Henri Pinault: luxury heir makes his mark
He tells Laura Chesters how he refashioned PPR into the global giant that was yesterday renamed Kering
Saturday 23 March 2013
Stepping out of the shadows of your father when he created one of France's most successful conglomerates can't be easy. But on the arm of his film star wife, Salma Hayek, at least François-Henri Pinault gets recognised in Hollywood and business circles.
Mr Pinault, 50, is the chief executive and chairman of France's PPR, a group created the year after he was born by his father, François Pinault. Mr Pinault Snr handed the throne to his son in 2005, leaving him to make his own mark on the business that once spanned everything from timber to catalogues.
Yesterday François-Henri made his biggest mark yet, renaming it Kering to emphasis his reorganisation of the €22bn (£19bn) listed group to focus on sportswear and luxury brands, which include the leading fashion names Stella McCartney, Alexander McQueen, Gucci and Yves Saint Laurent.
The old name derived from Pinault Printemps Redoute, although it sold the Parisian department store Printemps in 2006 and is spinning off and selling its catalogues business, La Redoute, as well as its music and books chain, Fnac.
But the new name doesn't totally eschew the business's roots: the Pinault clan comes from Brittany, and Kering, pronounced "caring", comes from the Breton for home, ker, while the owl logo is in honour of his father. "Owls are my father's favourite animal," Mr Pinault says. "It is his adventure that I am continuing."
Sitting in his large Paris office, the Arc de Triomphe at the bottom of the street, wearing a white open-neck Saint Laurent shirt and navy Gucci suit, Mr Pinault is detailing his growth plan. His easy, warm manner is unlike a typical billionaire businessman, his office functional, but displaying little of his group's value.
Mr Pinault's focus is on growth; he has plans to more than double sales to reach €24bn a year by 2020, up from €9.7bn currently.
But why not just focus on luxury and sell off the poorly performing sports business, which includes Puma, the brand fronted by the Olympic sprinter Usain Bolt? The luxury goods arm recently posted 21 per cent growth in sales, but its sports division has been lagging.
"Owning Puma doesn't make us perform worse in luxury. Analysts would like us to be only luxury as we would fit in their little spreadsheets better. But sports and luxury is my strategy. The sport lifestyle division addresses the young generation of the growing emerging economies."
Growth is going to be organic, but also through snapping up small brands that can be cultivated under the larger group.
Recent brands added to the collection include a Chinese jewellery brand called Qeelin, aimed at the Chinese market, while there are rumours that it is looking at the Milanese jeweller Pomellato. Last month it bought a 51 per cent stake in the London-based designer Christopher Kane. The purchase is the latest in a string of leading London designers now owned by the group.
"London is hot. For now all the new designers are coming from London," Mr Pinault says. "This could become a weakness for France, as I do not see the same depth of new talent here in Paris."
There are plenty of rumours on who might be next on his shopping list from the London scene, but Mr Pinault says the focus for now is on expanding Christopher Kane. Top of the list is finding him a London flagship shop, he says.
London is important, but the group has got to look internationally. The company, of which the Pinault family own 40 per cent through its Artémis Group, has even made English its official language, "which was pretty tough for some people". "In 2008 there was only one non-French person. Now we have 17 nationalities," he says.
Mr Pinault's commitment to equality in the workplace puts all our FTSE 100 companies to shame; he is committed to meeting France's law that 40 per cent of the board will be women by 2017.
More than half of his workforce and a third of his board of directors are women.
Far from the traditional picture of a man designing some of fashion's biggest brands, his stable of Gucci, Stella McCartney and Alexander McQueen all have women at the helm.
Once known as a playboy, Mr Pinault is now all for promoting the cause of women. He married Ms Hayek four years ago, and while she might not influence the clothes, she has influenced his views on life.
"There are very big issues facing women. Salma is the one who made me aware of this."
This month Ms Hayek, the singer Beyoncé and Gucci's Frida Giannini teamed up to launch Chime For Change, a global campaign for female empowerment.
Women are big business for the brand, but the biggest growth area is emerging markets – selling to men and women across Asia and South America. "Over the next 50 years, 3 billion people will potentially become the new customers of this world," Mr Pinault explains.
Recent headlines about fears of a Chinese growth slowdown is a big concern for luxury groups, but Mr Pinault isn't worried. "Last year there was a little slowdown. But over the long term there will be significant growth," he claims.
Plotting future growth shouldn't ignore the internet, but most luxury brands have been slow to adopt online sales. There are concerns about over-exposure, and worries about how a brand can control its image on the world wide web.
But Mr Pinault explains: "I do not understand the concept about overexposure. Online we sell to our same customers whether in the shop or online. But the service needs to be key."
Mr Pinault is thinking of alteration services and other add-ons that his brands can offer online. He has agreed a deal with the online retailer Yoox to help accelerate the development of its luxury brands.
Comparing the owner of Louis Vuitton and the number one luxury goods group LVMH, run by Bernard Arnault, with the Pinault empire is a popular pastime in Paris. The two fought to control Gucci in the 1990s, but the hatchet has long been buried. "We are not rivals. It is competition. Competition is good," says Mr Pinault.
Despite his clear love for London, he has no plans to leave France and become part of l'exodus to London. "We travel a lot, but it isn't for tax reasons. I come back," he jokes.
But Mr Pinault thinks the public and the press are too harsh on those who have left. "It is a personal choice. They are treated like traitors but have paid tax for 30 years and then decide to leave. The decision to leave is always painful – it is not easy to leave – especially for French people. We do not travel well."
Luckily for Mr Pinault, their fashions certainly do.
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