How the French Do DTC

On a freezing Monday night in Madrid’s upscale Salamanca neighbourhood, a long line of shoppers wait outside Spain’s only Sézane store. The scene – reminiscent of shoppers queuing outside luxury boutiques post-pandemic – is not unique to Sézane, but rather a testament to the appeal of new wave French DTC brands. Customers regularly wait hours to enter handbag-maker Polène’s stoles; Rouje’s first Paris location, opened in 2019, was packed from day one.

Sézane, Rouje and Polène have emerged as leaders among a generation of French direct-to-consumer brands that have flourished in recent years. By prioritising profitable growth and combining online strategies with select physical retail, the brands have successfully navigated a deteriorating market for digital fashion start-ups amid rising interest rates, high customer acquisition costs, and the return of in-store shopping post-pandemic.

The most obvious DTC benefits are not new to the French: controlled distribution, a stronghold on pricing and direct relationships with customers have been baked into their fashion system for decades. Louis Vuitton is the pinnacle of luxury DTC, with no wholesale or markdowns. Decathlon, too, is following the DTC tradition. As of 2020, around 97 percent of the French sporting goods’ assortment was made up of its own brand, leaving but a tiny space for merchandise from labels like Nike or On.

The new wave’s modern DTC approach has attracted investors and built a global community of loyal fans.

How did they catapult themselves into the heart of the consumer zeitgeist? The answer lies in conveying a clear narrative, building visibility on- and off-line and creating products that hit the sweet spot in terms of price and quality.

Digital-First

Physical stores have helped to drive visibility and sales for Sézane, Polène and Rouje, but are positioned as a complement to the brands’ online-first approach.

“Stores are important for these brands, but they are often more like showrooms,” said Olivier Abtan, managing director at consulting firm AlixPartners. “It is crucial for customers to experience the brand in-store, but they are e-retailers above all.”

This sets them apart from their earlier counterparts which have ramped up omnichannel efforts, but are stuck spending heavily to maintain sprawling networks of physical stores. Accessible luxury group SMCP (Sandro, Maje, Claudie Pierlot), which has over 1,600 stores, turned loss-making last year amid plunging demand in China while Ba&sh, with 267 doors, entered a court-supervised procedure to renegotiate its debt.

“Many of the older generation of French retailers had store-first policies, which generated huge fixed costs they are now stuck with. Especially those heavily exposed to China are trying to close shops now,” said Abtan.

An online-first approach has the advantage of limiting fixed costs while allowing brands to seize the momentum of shifting consumer behavior. Globally, it is estimated that around 20 percent of fashion is purchased online.

“We saw that women were more reactive to buying clothes on the internet,” said Charles Fourmaux, CEO of Balzac Paris, a brand founded in 2011 whose 2023 turnover was €25 million euros, with a 30 percent year-on-year revenue growth.

But where digital expansion plans fuelled by venture capital led some US-based DTCs to over-spend on customer acquisition to meet topline targets, French start-ups have a reputation for growing profitably, which is catnip to investors in an era of higher interest rates.

“We have been profitable since our first year, when we were just making bowties,” said Fourmaux.

Polène CEO Antoine Mothay also confirmed the handbag brand’s profitability since its first year.

French brands often remain family controlled, with investment coming from industry insiders. “There seems to be a sophisticated pattern to the French investment structure, which helps brands grow in a healthy manner,” said Richard Morgan, founder of Richard Morgan Advisory, which focuses on luxury and premium consumer goods.

Morgane Sézalory’s Sézane remains controlled by its founder after attracting minority investments from US fund General Atlantic and Téthys, the investment vehicle of the Bettencourt family that controls L’Oréal.

Polène, also family-controlled, was initially backed by French businessman Pierre-Edouard Stérin via his investment fund Otium Capital. In 2024, Otium sold part of its stake to LVMH’s L Catterton – a specialist in retail roll outs, as Polène now opens more stores. The brand saw new locations fuelling growth on top of 2023 sales of €142 million ($153 million).

Rouje, which is in an earlier stage of its development, sold a stake in 2020 to tech-focused investor Partech – known for backing European scale-up plans. Figures are not disclosed, but multiple store openings in France as well as a New York location last year “testify to strong demand and dynamic high growth,” according to Morgan.

Right Products, Right Price

At the core of the new wave of French DTC are products that offer novelty and quality at a fraction of the price of luxury and designer competitors trading on France’s style authority. From Polène’s organic, contemporary handbag designs to Sézane’s signature knitwear, emerging players have filled white space in the market with propositions that are differentiated, but not too niche.

“Many of the older brands have lost their price-quality attractiveness. They mostly manufacture in China, the quality isn’t there and they’ve raised the prices too much,” said Abtan. This turns customers away from buying the brand full-price and in turn, those brands rely on heavy, frequent discounting.

Polène, on the other hand, never does sales or discounts, at most offering free shipping before the holiday season. Sézane sometimes clears older inventory with archive sales online, but opts out of major promotional events like Black Friday.

“Newer brands launch at a 30 to 40 percent lower price than their older counterparts, but ultimately, the realized margin is about 60 to 65 percent for both,” said Abtan.

Strategic Wholesale

French womenswear brand Soeur was founded in 2007, slightly ahead of Polène and Rouje, both launched in 2016, and Sézane, founded in 2013.

Soeur also isn’t as online or DTC focused as the other three, with a revenue split of 20 percent wholesale, 50 percent retail and 30 percent online. Despite the market trend to direct sales, the brand sees virtue in maintaining, and even growing, some of its wholesale accounts.

Even as Soeur plans to open ten new stores in 2025, “our intention is to grow the wholesale channel, with upgraded wholesale distribution,” CEO Freja Day said. With a balanced strategy, Soeur’s sales have grown around 30 percent per year for the past 3 years, with global revenues topping €65 million in 2024.

“Wholesale is certainly not dead. It gives validity to a brand, there’s a stamp of approval if you’re displayed at Harrods or Le Bon Marché,” Morgan said. “Wholesale is 50 percent of the general market, it’s massive.”

Building Community

The leading French DTC players have all attracted an audience of loyal followers to support their brands. There is no one formula for doing so, but “there needs to be a clear raison d’etre, a very strong sense of purpose with clear values,” said Abtan.

In Rouje’s case, the brand is umbilically tied to founder Jeanne Damas, whose Instagram has 1.5 million followers. “Being an influencer makes community building easier,” said Abtan.

Sézane founder Morgane Sézalory also started building her own community by selling vintage items through social media, though she’s since become less visible in the brand’s communications.

The Mothays, Polène’s founding family, have kept private from the start, with no public Instagram accounts. Polène’s brand account, however, has built a following of 2.4 million with its artful still lifes and campaign shoots of models sporting its handbags in striking natural landscapes. Coverage from handbag and travel influencers who investigated the hype surrounding the mysterious start-up helped word-of-mouth to snowball (with persistent queues outside its Paris flagship helping to sustain curiosity, as well).

“Having a community is key to lower acquisition costs,” said Abtan. However, timing may have also been ideal for the likes of Rouje, Polène and Sézane. “Entry barriers are getting higher. Ten years ago it was easier to create a community, Instagram now is more expensive and the space is more crowded.”

Editors' Note: This story has been modified on 14th Jan. 2025 at 2:50 BST. A previous version of this story incorrectly stated Polene's revenues. The brand achieved €142 million in sales in 2023.