Starbucks Adapts To Gallic Tastes In Growth Quest

By Lionel Laurent

PARIS | Thu May 27, 2010 9:49am EDT

(Reuters) - Coffee chain Starbucks Corp is changing its ways in France and trying to adapt to the local palate as it tries to break with past losses.

The group's French outlets have recently started to offer well-known local fare like the "cafe gourmand" -- a single shot of espresso served with three delicate pastries including a mango macaroon.

It is a far cry from the 12-ounce cups of American coffee and chunky muffins that made Starbucks a worldwide brand, but after years of losses in France the $20 billion group is having to make concessions to the local cafe culture.

Achieving international success in markets like continental Europe and Asia is seen as crucial for Starbucks as it seeks to drive growth outside a saturated home market.

"We in France don't drink coffee all day long and flavored coffee is not in our culture," said Bernard Boutboul, head of food retail consultancy Gira Conseil.

Starbucks needed to "Gallicise" its menu if it wanted to succeed in France, Boutboul said.

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Rural Mayor Set To Head Credit Agricole

By Lionel Laurent and Matthieu Protard

PARIS, May 18 (Reuters) - French bank Credit Agricole (CAGR.PA) is widely expected to name rural mayor Jean-Marie Sander as chairman on Wednesday amid tough economic times.

The bank is under pressure to reassure investor confidence after missing first-quarter profit expectations on the back of rising loan provisions in Greece.

Sander, a 60-year-old farmer who is also mayor of the small commune in the northeastern Alsace region where he was born, will be the last key appointment in Credit Agricole's management overhaul as it seeks to turn the page on the financial crisis.

A more reserved figure than outgoing chairman Rene Carron, who has reached the age limit of 67, Sander's strong ties to the Alsace region and his family's farming origins mark a symbolic return to Credit Agricole's agricultural roots after the crisis.

"It's clear Sander is a big backer of the agricultural cooperative model and its values," said a colleague of Sander's, who said the mayor brewed his own hops and sold them through a cooperative.

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French Banks Among Worst Hit By Capital Uncertainty

By Lionel Laurent - Analysis

PARIS | Mon Apr 12, 2010 2:49pm BST

(Reuters) - French banks may be among the most exposed in Europe to tighter capital requirements due in 2012, despite having emerged relatively unscathed from the global financial crisis.

Fears that stricter guidelines will leave French banks like Credit Agricole (CAGR.PA) and Natixis (CNAT.PA) short of billions of euros in core capital have hurt their share valuations and are likely to persist until more clarity emerges.

France is not alone. Banks across Europe are expected to need $65 billion (42.2 billion pounds) in fresh capital to meet so-called "Basel III" proposals, according to one study by UBS. The proposals are still at the consultation stage.

But Credit Agricole and Natixis seem more exposed than many others because of their cross-shareholdings in regional and cooperative banks, which Basel may disqualify as core capital.

"The market has priced in more risk for the capital of cooperative banks than for other banks," said Vincent Durel, a Fidelity fund manager who manages some 300 million euros (265 million pounds) in assets.

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Regulation To Trigger Bank M&A -Rothschild Exec

By Lionel Laurent and Julien Ponthus

PARIS | Wed Mar 17, 2010 8:36pm IST

(Reuters) - Expected tighter capital restrictions on banks will likely trigger a wave of consolidation in the sector by pressuring firms to slim down, a managing partner of investment bank Rothschild & Cie told Reuters.

The cost of carrying more capital will push banks to become more focused on their best-performing business lines, paving the way for asset sales and a move away from diversified business models, Francois Henrot said in an interview.

"The fact the regulator is now forcing them to set (more) capital aside will push them to make a choice," said Henrot, adding banks would no longer be able to afford operating dozens of businesses from property and insurance to payment services.

New proposed rules from the Basel Committee on Banking Supervision, known as Basel III, are aimed at increasing the amount of capital and liquidity banks must hold and lessen the need for more taxpayer bailouts in future crises.

They are due to come into effect by 2012, but uncertainty over their precise content -- which is still at the consultation stage -- has put the brakes on deal-making in the financial sector, said Henrot.

"It's very difficult today to do big transformative deals in the banking sector when you don't know which rule you will be subject to," he said.

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Top French Firms Feel Heat From Online Satire

By Lionel Laurent

PARIS | Tue Jan 5, 2010 7:45am EST

(Reuters) - The rise of video-sharing websites such as YouTube and Dailymotion is proving to be a headache for some of France's biggest companies as their image comes under fire from satirical online videos.

The aim behind humorous video clips can vary -- some are made by film producers as publicity stunts, others simply for fun -- but the potentially global impact and unpredictable nature of the clips can make them difficult for companies to contain.

"Brands were in the mindset of having one message, one broadcast," Emmanuel Vivier, chief executive of marketing agency Vanksen, said. "Now people reply to the brands' messages, remix them, redistribute them... impacting their reputation.

"It's becoming harder and harder to tell the difference between a real advert and a fake one," he said.

French grocer Carrefour, the second-biggest retailer in the world, was last month forced to disown and condemn a fake video advert that implied its discount food range contained human remains.

The video, which first appeared on Google site YouTube in early December, depicts an angelic little girl munching reluctantly on her grandmother's bones as her parents egg her on.

"It was a concern for us," a Carrefour spokeswoman said. "It did not give a good image for the brand."

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Printemps CEO Confident In Christmas, Luxury Focus

By Lionel Laurent

PARIS, Nov. 13 | Fri Nov 13, 2009 11:01pm IST

(Reuters Life!) - Printemps' flagship Paris department store says it is set to reap the benefit of a $105 million refurbishment and a new luxury strategy as it kicks off the Christmas season.

The retail chain's chief executive, Paolo de Cesare, told Reuters on Thursday he was "optimistic" about holiday trading at a time when French consumers are still showing signs of caution.

"Summer was difficult, but I see now customers coming back," said de Cesare. "In the end there is the spending power, and consumers are ready to invest where they find the right opportunity."

De Cesare said a week of sales in mid-November had brought in 30 percent revenue growth when compared to the same period a year ago. He added the discounts were "very targeted" and would not affect holiday trading or bigger January sales.

New data on Friday showed the French economy grew by 0.3 percent in the third quarter of 2009, with job losses slowing while consumer spending stabilised.

The holiday season is still expected to be subdued, according to several analysts, citing rising unemployment and the strong euro's negative impact on tourism flows.

"Although consumption is not plummeting like some people feared, it's still really weak when compared to historical patterns," said Diego Iscaro, an economist at IHS Global Insight.

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Louvre Plays Home To Apple's First French Store

By Lionel Laurent

PARIS | Fri Nov 6, 2009 12:42pm EST

(Reuters) - Computer giant Apple Inc will open its first French store beneath the Louvre museum on Saturday just two weeks after Microsoft opened a theme cafe to promote its Windows 7 software.

Although Microsoft had a head start promoting its new Windows operating system in France, Apple has placed its first store in a prized position in the bowels of the Louvre museum's "Carrousel" shopping center.

Both companies have large operations in France, according to Paul Jackson, an analyst with Forrester Research, but he said Apple in particular was looking to burnish its premium image with its new Paris site.

"It's more to do with the feeling of association with premium shopping than necessarily the market itself," said Jackson. He said France as a technology market tended to lag behind Britain and Germany, which already have Apple stores.

Apple's French expansion will take place against an uncertain economic background, with consumer spending in France still volatile and supported by government measures such as the car scrappage scheme.

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