France - Carrying on as before?

We set out six questions facing France and its people as we look to the period ahead.

Is inflation the answer to global warming?

The September wave of Ipsos’ What Worries the World survey, conducted 29 countries, showed that France was the most anxious country when it comes to climate change, ahead of Austria and Germany for the first time ever! 34% singled out climate change as a major concern facing their country vs. an average of 18% worldwide, and ahead of their historical concerns (unemployment, security, immigration). Only inflation stood at a higher level (39%).

The tension between our natural tendency to “carry on as before” and the imperative – moral, financial or both - to drive less, eat less meat and limit long-haul holidays, is more and more present. Inflation could be our tipping point: will it accelerate the transition of our economy, or will it reveal that the mountain is too high to climb? France’s head start on these issues may well set the tone.

Inflation could be our tipping point: will it accelerate the transition of our economy, or will it reveal that the mountain is too high to climb?

Will inflation kill the middle classes?

Even a year ago, the decline in their purchasing power was already of great concern to the French and our latest analysis puts the spotlight on a new and sensitive category of consumers, the "Surprised", rather well-to-do people, with housing, a second home, several cars, who often leave for the weekend... representatives of an upper-middle class.

The "Surprised" believed that their level of income would allow them not to feel the impact of price increases but, with the explosion of energy costs alongside rising prices of goods and services more generally, they have discovered the trade-offs and are now giving up certain purchases or habits for the first time. 88% of French people expect inflation to rise further and 55% expect their purchasing power to deteriorate. We can hypothesize that the "Surprised” category has already developed in many other countries, with political and social consequences following on from their feeling of downgrading.

Of course, many French people have been tightening their belts for a long time now, having learned to make do with their declining purchasing power and just about managing thanks to the increase in social benefits; this category is often called the “Vulnerable” or the “Precarious”.

Under pressure: can employers take back control?

The measures put in place as part of the Covid-19 health restrictions have revealed new ways of working. By mid-2020, almost two-thirds of French employees had worked remotely for the first time, and by the end of 2021, 57% of those who had tried it hoped to be able to continue to work remotely in some fashion, shattering most established management rituals in the process.

Then came the fear of the “Great Resignation”, quickly followed by “Quiet Quitting” –  themes which tell us that the need for meaning, usefulness, societal purpose and company commitments are becoming the norm, especially as Gen Z hit the job market. And, with major recruitment difficulties across all sectors (driven by a record white-collar unemployment rate below 4%), competition is fierce.

So, what can employers do? Attention to wellbeing is now front and centre: 44% of French employees believe that this is the first area which their company must address, ahead of managerial transparency (29%), and work organization and management by trust (27%).

Full electrification by 2035: now what?

On May 12th 2022, the EU shocked car lovers across the world by announcing the end of new internal combustion engine vehicle sales in 2035. A bold and important goal, but how ready are we to actually change our habits?

France, being among the most anxious countries when it comes to climate change, holds some interesting insights when it comes to EVs. First of all, only 10% of French people agree that “it is a priority in the fight against climate change" and only 39% believe that “the generalization of electric vehicles will have a positive effect on the reduction of pollution”, some way behind measures like reducing water consumption or no longer taking planes. So the issue does not seem as important as the buzz around it. But more importantly, we seem to underestimate the hurdles. 75% do not agree with the idea that the French will have to fully switch to electric vehicles by 2035 and 71% do not think the infrastructure will be ready on time! This is the main challenge for public institutions.

Where will the big luxury bang end? 

Luxury has always been associated with qualifiers such as being immutable, timeless, incorruptible, faithful to origins and traditions even when it meant defying fashion. This has been its historical definition and especially the French one. Now, and under the impetus of a new generation of creators, luxury stands for breakthrough, innovation and audacity.

Probably for the first time in their history, our “Maisons” find themselves at the crossroads of commercial shifts, new cultural expectation and emerging ethical issues. All luxury brands have had to quickly transition to digital channels during the Covid period. And if this resulted in significant commercial success it also fundamentally changed how luxury is bought. Compared to any physical luxury experience, digital tends to trivialize the magic. Clients no longer have much in common with Clark Gable or Princess Grace. Rappers, sports stars and crypto aristocrats are combining scruffy streetwear with luxury cars while designers are blending tradition with pop culture icons.

These evolutions are allowing Maisons to pursue their expansion, stretching into anything from travel, hospitality to sportswear, and leading the race to NFTs and the metaverse, hence totally redefining the definition of experience. Opportunities seem limitless but do beg the question: how far can they stretch whilst staying true to their legacy?

Marketing matters: is nostalgia the answer?

The coronavirus crisis has heightened expectations of products and brands whose history and origin we know, to reassure consumers and meet new expectations, Nostalgia embodies the perfect antidote to an anonymous globalization, an elusive present and a scary future.

Nostalgia is a social creation and a foundation for marketing and advertising strategies considering the past as the ultimate cultural reference, an unsurpassable and authentic gastronomic, aesthetic, artistic… tradition

And the retromarketing trend is still at work, from polaroids and cans of sardines to vintage clothes. Because it idealizes the past, nostalgia provides emotions which respond to the fears that are reflected in the Fractures françaises survey, which has been observing society since 2016: in 2022, 69% of French people declared that they were "increasingly inspired by values ​​of the past" and said they agreed with the idea that "in France, it was better before". Mass consumption offers an amazing theatre for nostalgia: “A l’ancienne” (old-fashioned) has become the absolute claim for ham, soap, or lemonade.

Alexandre Guérin