Monday, November 30, 2015

Lidl Ready To Conquer The US Market

Costco is coming to Europe? European are coming to the US! Indeed, this is a very important news for the retail world. As much as the arrival of Costco in Spain and soon (hopefully) in France, Lidl projects to enter the US competition starting in 2018.
Lidl is aiming to open mostly on the east coast, but also including some locations in California. Thanks to its business modell based on small and cheap stores to open, they can spread the country fast, with low investment.

In fact 200 people are already working on the development plan of the German company.

Lidl has evolved a lot lately, trying to be considered as a more modern actor of the retailing world, by enlarging their product ranges, adopting massive commercial campaigns, having more national label in store, and focusing more on the fresh products.

I believe there are clearly similarities in the two projects. 
  • Both have unique concepts, based on low prices, but with different tools in terms of business models.
  • Both have large investment capacities due to their size. They are both in the top 5 of the brick & mortar retail rankings.
  • Both companies are facing a new kind of competition landscape: Mature businesses with already strongly founded retail concepts. In Europe, hypermarkets like Tesco or Carrefour. In the US, the tycoon Walmart. But this is actually also a great opportunities as it gives free space to specific concept far from those ones.
Now, negative people will tell you that Americans already have a wide range of choice in terms of retail, that at the digital age why a hard discounter would succeed, and I don't know other skeptical comments. The same that are skeptical about Costco's success in France, the land of good food and Carrefour. But if you see what kind of competition Lidl gives to Tesco in the UK, you would maybe understand better. On top of that, both retailers are thriving worldwide with a concept that yet no one has been able to master as they do.

Of course, Aldi is already located in the US, and it has been for decades. But Lidl I believe has a stronger concept, and its arrival could change the way the retail is organized in the US. Aldi is actually having great results thanks to its original Trader Joe banner.

It will be a long wait until 2018 to see how the Americans react to the historic hard discount modell.

For those of my American Audience (actually it is my first audience worldwide) whom may not know about what a Lidl look like, you may have a look below at the video showing you how a store look like.

Sunday, November 29, 2015

Débrief journées de l'IFM

Pour la première fois je me suis rendu ce jeudi aux journées de l'IFM, se tenant à la Défense. Les journées de l'IFM, c'est l'un des plus grands événements annuels autour de la grande distribution. C'est un lien principalement d'interventions, de grandes personnalités (type dirigeant de la grande distribution), ou bien d'entreprises leaders sur leurs marchés.

L'IFM est l'Institut Français du Merchandizing, un organisme paritaire entre les distributeurs et les industriels, ayant pour but d'être un club de réflexion et d'échange autour des sujets du commerce. J'ai déjà participé à certaines de ces réunions, qui sont toujours très intéressantes et enrichissante, qui permette de montrer les meilleurs pratiques notamment en terme de marketing du point de vente.

Les journées de l'IFM se déroulent en 3 jours:
  • La première, celle des grandes conférences, avec la participation des "grands patrons" à la tribune. Très certainement la plus "people", et peut être la plus intéressante.
  • La deuxième, celle des remises des prix, notamment des "mètres de l'IFM", qui récompensent les meilleures approches catégorielles et mises en place en magasin. Babyliss a d'ailleurs gagner cette année.
  • La dernière, celle où je suis allée, et celle des différents partenaires, qui présentent leurs solutions et leurs vision du commerce. Beaucoup de prestataires donc.

Ce fut assez intéressant pour la partie prestataire, sur un format assez court, donc condensé et direct à l'essentiel. 

Un petit salon, mais avec pour le coup de très bons intervenants:
  • Nielsen et IRI pour les études
  • CPM pour la force de vente
  • Café Royale, pour montrer son concept (très aboutis). D'ailleurs Café Royale était l'un des seuls industriels représentés via un stand.
  • CA Com pour les agences de publicité...
Un événement intéressant, condensé. Maintenant quelques regrets:
  • Peu de technologie pour un événement majeur de ce style: Pas de Periscope, très peu de Live Tweet (hormis les quelques uns que j'ai fait). C'est dommage, car à l'heure des Beacons, de l'Ecommerce, etc... On se rend compte que la distribution française n'est pas encore là.
  • Des présentations encore un peu formaté et ce via 2 traits: Les discours généraux du type, "il faut investir sur le web", "c'est de la vente additionnel". Le deuxième, c'est des présentations un peu trop "vendeuse", trop argumentaire marketing. Et c'est dommage, car j'ai eu quand même de supers informations dans ces présentations. Mais peu un peu mieux faire...
  • Manque un tout petit peu de stands pour vraiment gagner en attractivité. En effet, tout les stands étaient fort intéressant, mais on fait vite le tour. Pour un événement sur 3 jours (bien que chaque jour soit payant et dissocié), je trouve cela un tout petit peu dommage.
En tout cas, c'était fort intéressant, et je pense vous abreuver de poste bientôt sur les idées qui sont ressorties de ma visite.

Friday, November 27, 2015

Walmart Invests In Its Warehouse To Compete Online With Amazon

I announced it at the beginning of the year, but it is for use an important year for brick & mortar tycoons which invested a lot in gaining market shares on the Ecommerce playground. Walmart is for sure the retailer that invested the most.

This summer, Walmart has opened a brand new warehouse for that matter. Indeed, to compete with Amazon or other pure players, you need to have the same tools. This is the reason why they opened a 110 000 square meters warehouse dedicated 100% to their Ecommerce business. Why is this warehouse more adapted to the Ecommerce competition?

Walmart plans to open 4 other warehouses by the end of 2015 to reach 95% of the US population. Furthermore, obviously, Walmart owns a large store network that can complete and offer more versatility to customers to get their goods.

This example shows you clearly that supply chain and logistics are key elements in the Ecommerce business that needs to be mastered. It is different to ship goods in full trucks than couple of packages to a home. And Walmart is working actively to fill the gap.

Thursday, November 26, 2015 Use Both In Store & Online Data To Customize Its Webpage

Tesco has always been one of trail blazer of the data usage in the retail business. They have designed one of the most efficient customer loyalty reward program ever, operated by a joint venture named Dunnhumby. The success of the program has always been based on the ability of Dunnhumby to analyze customers behavior in order to propose them accurate promotions.

Sandrine Devy chief of sales of international markets, have recently given an interview at French magazin LSA. She explains the way Dunnhumby is leveraging both in store collected data with online visits data.

The Tesco's online website have been splitted in different sub categories, each of them customized. This is the reason why each customers will have a unique webpage, due to all those multiple factors that will be shaped upon its purchase behavior.

Indeed, you can see below that you have not only customized promotions, but shopping list features, recommandations based on lifestyle, ...

This feature has been enabled by the fact both in store and web data have been synched in a unique data base. 

Moreover, Dunnhumby is working on a new program that will allow customers to analyze their own shopping paterns, with information on where they have spent money, what kind of products they consume, in order for them to shop better.

Dunnhumby is struggling at the moment with its international business, as they have stopped partnerships with two important historical retailers, Kroger in the US and Casino in France. Furthermore, Tesco is looking forward selling its shares in order to focus on its operations. 

But as you can see after having read this article, they clearly master their trade, and could help a bunch of retailers to benefit from big data.

Actually, probably it is one of the best way to succeed in a multi channel effort for brick & mortar retailers: to do it by customers analysis to propose them the best response to their needs.

Wednesday, November 25, 2015

Négociation: Comment Apple négocie avec les opérateurs de téléphonie mobile

Intéressante vidéo de l'émission Cash Investigation. Le sujet: le marketing et ses techniques. Emission assez subjective, pour être honnête, pas vraiment de la meilleure qualité. Par contre, un passage a attisé ma curiosité, et là pour le coup, j'ai été très surpris et vraiment intéressé. 

L'émission parle des techniques de négociations utilisées par Apple pour négocier avec les opérateurs télécom lors de la sortie de l'Iphone. Mais au lieu de détaillé la version de complément d'enquête, je vais essayé de vous faire MA version . Je n'ai pas plus d'informations que le documentaire, voire moins car j'adorerai mettre la main sur le document cité dans l'enquête, mais je vais vous faire part de mon avis, en tant que professionnel, de l'autre côté du fauteuil (acheteur).

La partie sur Apple commence après 1 h00 de vidéo

1 Le contrat d'exclusivité
Pour moi c'est la base et cela n'a pas été détaillé dans le sujet. Apple a lancé dans tous les pays du monde son Iphone avec un contrat d'exclusivité avec un distributeur. Aux US, AT&T, en France Orange. Pourquoi?

  1.  Afin de pouvoir sécuriser la bonne mise en avant de ces produits. Grâce à l'exclusivité, le distributeur a un intérêt de mettre en avant se produit qui le différenciera de la concurrence.
  2. Certainement qu'en assurant une exclusivité, donc un avantage compétitif, Apple a négocier un prix pour cette exclusivité.
  3. Egalement parce que dans le cadre de l'exclusivité, il sera plus à même de pouvoir négocier des mises en avant spécifique de son produit au sein de l'opérateur.

Pour moi, c'est la clé de la suite: sans cette exclusivité, il n'y a pas de part de marché, pas de besoin de la concurrence d'accepter les conditions du fabriquant américain. 

2 L'ouverture du marché
Une fois des parts de marché solides sécurisées avec le partenariat d'exclusivité, Apple va négocier avec les autres opérateurs. Comme Apple est devenu un incontournable, il est en position de force pour négocier. Le premier rôle d'un acheteur est d'avoir le produit. Les conditions viennent après.

C'est la raison pour laquelle Apple est beaucoup plus fort pour imposer ses conditions, en terme de mise en avant des produits.

Il impose ses conditions, certainement fort de ce qui a été réalisé par le partenaire exclusif, qui avait lui un intérêt certain à mettre en avant ce produit phare et unique dans son assortiment.
  • Place dans le linéaire, avec corner premium
  • Au minimum 2 vendeurs dédiés à la marque.
En s'assurant de la bonne visibilité de ses produits, Apple est certains de la bonne revente de ces produits et donc de continuer à vendre bien ses produits, ce qui constitue un cercle vertueux pour la négociation.

3 Des clauses limites abusives

une fois le marché contrôlé, Apple impose des conditions abusives aux opérateurs. 2 qui me parraissent encore, incroyable:
  • Des quantités d'achat minimum pour vendre le produit. Est ce bien légal? Pour SFR, le quota est de 4 millions d'appareil! Cela représente un taux de pénétration de 6% minimum de la population française.
  • Interdiction pour l'opérateur de faire des publicités ciblées en faveur d'un produit concurrent pour les utilisateurs d'Iphone. 
  • Paiement de la publicité télévisée pour les téléphones Iphone, en échange d'un petit logo sur le claim de fin de publicité. Cela représente un budget de 10 millions d'euros pour SFR

4 Conclusion
Maintenant, est ce que c'est une bonne approche de négociation? Certainement que dans ce cas précis, Apple réussit aussi bien à sécuriser son prix de vente, mais également le succès de la revente. Par ailleurs, la puissance marketing créant le désir autour du produit est aussi un moyen important de faire pression sur l'opérateur, qui ne peut se passer du produit.

Mais cette technique ne prévaut que dans des cas bien précis. Par ailleurs, aujourd'hui le CA réalisé sur l'Iphone est si important que les opérateurs n'ont d'autres choix que de répéter ce système, sans quoi ils ne pourront pas repasser sur le chiffre d'affaires de l'année précédente.

En tout cas l'étude de cas méritait d'être mise en avant sur ce blog. 

Tuesday, November 24, 2015

Book Review: Management in 10 Words

I have noticed I have never done a book review of the excellent book of Terry Leahy Management in 10 Words. I read it couple of years ago, and I highly recommend it. It is clearly a great book, telling the career of Terry Leahy, who has experienced most of the most important parts of Tesco's adventure.

Here are some of the things I liked about the book

The TWIST Progam: Tesco Week In Store Together. I believe this is very important for people of the head office to confront the realty of what customers are, what the life in a store is. Tesco has a brilliant idea to copy.

The story of the loyalty reward program is amazing. How Tesco had to wait for the technology to enable them to analyse sales data, which allow them to create their loyalty reward program, that has been envied for decades.

The management principles, especially about responsability of the staff, and the importance of simplifying the management decision making process, to be more lean and fast to adapt to competition and customer demand.

Monday, November 23, 2015

Customer Relationship Management: Understanding The New Decision Making Process

Understanding the different components of the decision making process is a key factor of success for a customer relationship management program. It will enable you to trigger the accurate stimuli in order to lead sales.

The Traditional Decision Making Process
It has 3 main components:
  • The stimulus: The first contact with the potential customer. It could be by different advertizing media. Usually, before, mass media campaigns, such as TV or radio spots
  • The FMOT: the first moment of truth. The ten minutes the then shopper takes to pick up your product in a store.
  • The SMOT: the second moment of truth. The moment the shopper becomes a consumer of your product, experiencing if it is what he really expected.

Then the ZMOT shows Up
Then the Zmot appears. The ZMOT, or zero moment of truth is all the different interferences along the purchasing process created by Internet that could affent the brand image by the shopper. There are 4 main ZMOT:
  • Information search: products characteristics, pricing
  • Advice readings: comments, forums
  • Video reading
  • Social Media
The trick is that the ZMOT could happen at any time of the decision making process, making it difficult to influence and/or to master. 

The ZMOT is a real revolution in a way that customers now can interract with the brand, either while a prospect (looking for information to make the right decision), a shopper (while actually making the purchase), or a customer (using the product). The ZMOT is therefore a key for a CRM company to understand, even though it is nearly impossible to master it at a 100%.

Moreover, the multiplication of the stimuli (different media of advertizing) makes the communication to customer difficult to make, especially during push campaings. Attention of people is more and more difficult to get, therefore lowering the impact of advertisement, and highering its effective cost.

Now, I believe that ZMOT is actually a way to make people understand the importance of social media and new media such as mobile phones, tablets, augmented reality, in order to connect with people, in order to improve customer experience. 

Friday, November 20, 2015

Quelques réflexions sur la baisse du panier moyen de l'Ecommerce

C'est une étude assez ancienne (2013), mais qui est basée sur une tendance de fond, et qui a été reprise depuis notamment par LSA. Le panier moyen du E commerce ne cesse de baisser. Cette baisse est bien trop importante pour être liée à une guerre des prix. En fait, cette baisse des prix est liée à 2 tendances :
  • Au développement de nouveaux segments du Ecommerce, souvent moins valorisés, tel que l'alimentaire.
  • A la hausse de la fréquence d'achat, notamment liée à la baisse des frais logistiques, qui incite les gens à passer de plus petites commandes, mais souvent.
D'ailleurs, ces 2 facteurs se voient bien dans la stratégie du leader Amazon: Des livraisons le même jour, et le développement de l'offre Amazon Fresh, ou encore les "Dash Buttons". 

C'est aussi la raison pour laquelle, il est de plus en plus difficile pour moi de parler de l'Ecommerce comme un marché à part entière. Nous sommes dans l'ère du multicanal depuis très longtemps déjà, et par ailleurs, comment comparer Expedia à Cdiscount ou bien Chronodrive? Sont ils réellement concurrents? 

Thursday, November 19, 2015

Some Thoughts On Amazon Banning Apple TV & Google Chromecast From Its Website

I recently learned that Amazon has stopped selling on its website both Apple TV & Google Chromecast. Both gears are aimed to plug online video features onto a TV set. Amazon has decided so as they have their own TV plug, the Amazon Fire TV.

This is actually a very interesting topic. Shall we blame Amazon to do so? On a customer stand point, you can obviously discuss the fact they are restraining competition. But Apple don't sell in its Apple Store neither Amazon Fire TV nor Chromecast. But obviously, when Amazon is aiming to be the all around retailer, expanding its categories way beyond cultural goods, how could they explain to avoid proposing good sellers?

But what is important to notice is to see how those companies, that based their initial expertise in different fields are now in direct competition from each others:
  • Apple is an electronic hardware manufacturer, that got into the cultural good market, thanks to Itunes, but other new platforms they are working on.
  • Google is a search engine company, that is now producing software for mobile gears as well as hardware;
  • Amazon is an online retailer that is building hardware to master the sell of cultural goods.

Because of this new kind of competition, you can clearly see that it is difficult to apprehend a competition that have different interests.
It will be interesting to see the new points those companies will have conflicts as their strategies expand.

Wednesday, November 18, 2015

Category Management Series: The New Age of Merchandizing

Merchandizing is a key element of a category management strategy. It is at the cross road of several key departments, and interests:
  • The supply chain, in order to maximize its efficiency and lower the potential stoc outs
  • The product range, in order to set it up clearly for customers
  • The maximization of products expositions depending on their performances.
Merchandizing must evolve. We are living in the age of big data, and customization. Therefore, merchandizing must take advantage of the new technologies in order to allow retailers to set up fast planograms that suits the local clientele by adaptating the product range and organization fast.

Moreover, merchandizing is probably an element that needs to benefit from big data in order to take into account more closely some other key elements of retail performance. For example, by being able to understand better the supply chain problematic, in order to propose at all time the most efficient supply chain by taking into account the pace of orders of the warehouses for example.

New technologies are coming out. Especially 3D schemes allowing to better understand the impact of certain choices.

New customer interface in store is also possible, by using new mobile technologies, augmented reality for example. 

Merchandizing is already at the moment a difficult art. The number of products listed has skyrocketed over the last decade, about 30% of the product range change each year with a high number of innovations coming in. But merchandizing as a high potential to go beyond, thanks to big data and new software, which will allow to better serve customers. 

Tuesday, November 17, 2015

Retail History: Letter of Michael Cullen (Founder Of King Kullen) To Kroger

I read a very interesting and old book named Les Inventeurs du Commerce Moderne by Ethienne Thil (which created Ed in France, and was the former chief of marketing of Carrefour in the 70s). In this book, the author gives example of the greatest story in the US of the creation of retailing.

One of the interesting story is the one of Michael Cullen. He was an employee of Kroger, which was already a pretty big retailer at the time. Michael Cullen had a vision of what modern commerce should be. He hence wrote a letter he sent to the CEO of Kroger to share his vision, with the aim to have the ability to practice his idea.

The letter is just awesome, this is the reason why I wanted to share it with you. 
  • It is so detailed it is crazy! He had a clear idea in mind of how it should work.
  • He pictures some key concepts of what discounter will use to leverage revenues, especially perequation and rationalization of operational costs.
  • He even envisionned how he would spread his store networks, and the impact it would have on inventory, purchasing power....
  • He was so passionate about his trade you can feel it all along the letter.
The letter has never been read by the CEO, which eventually resigned. Michael Kullen created the chain King Kullen and experienced much success with his concept.

The Letter
0 feet wide and 130 to 160 feet deep, and they ought to be located from one to three blocks out of a high-rent district with plenty of parking space, and same to be operated as a semi-service store -- 20% service and 80% self-service.

My grocery equipment would cost $2,500. My meat equipment would cost about $4,500 complete. A total outlay of $7,000 for equipment and a $23,000 stock of merchandise in each store. In other words, I would have an investment in each store of $30,000.

... I expect to do a grocery business of $8,500 per week per store [and] a fruit and vegetable business of $1,500 per week per store. In other words, the kind of stores I have in mind should do a grocery business of $10,000 a week and a meat business of $2,500 per week. On the grocery business, including fruit and vegetables, I can operate on a gross profit of 9%. ... Our meat department sales per store would be at least $2,500 per week, and we would make a net profit of at least 3% on this meat business.
This is the kind of cut-rate chain of wholesale-selling direct to the public that I want to operate:

I want to sell 300 items at cost.

I want to sell 200 items at 5% above cost.

I want to sell 300 items at 15% above cost.

I want to sell 300 items at 20% above cost.

I want to gross 9% and do a grocery, fruit and vegetable business of $10,000 per week and make a net profit of 2.5% on the grocery department and 3% on the meat department.
You need have no fear regarding the present overhead of the chain stores. My buying, advertising and hauling expense of $110 per week per store is more than enough to take care of the buying under my supervision, and this could be reduced 25 points after I had my fifth store opened.
I would bill all merchandise to the store at cost and adopt a cash register check system so that stealing or dishonesty would be impossible. I would inventory these stores every month at cost, and their stock gain less all current expenses would be our net profit per month per store.
It would be a little difficult to begin with to buy for my first store, but after my fifth store was opened, I could buy the minimum shipments and ship 80% of same F.O.B. to the store direct, thereby eliminating entirely a warehouse, which is not necessary when these monstrous stores could show a turnover such as I would get.

Can you imagine how the public would respond to a store of this kind? To think of it -- a man selling 300 items at cost and another 200 items at 5% above cost. Nobody in the world ever did this before. Nobody every flew the Atlantic either until Lindbergh did it.
When I come out with a two-page ad and advertise 300 items at cost and 200 items at practically cost, which would probably be all the advertising that I would ever have to do, the public ... would break my front doors down to get in. It would be a riot. I would have to call out the police and let the public in so many at a time. I would lead the public out of the high-priced houses of bondage into the low prices of the house of the promised land.
I would convince the public that I would be able to save them from $1 to $3 on their food bills. I would be the "miracle man" of the grocery business. The public would not and could not believe their eyes. Weekdays would be Saturdays, rainy days would be sunny days, and then when the great crowd of American people came to buy all those low-priced and 5% items, I would have them surrounded with 15%, 20% and in some cases 25% items. In other words, I could afford to sell a can of milk at cost if I could sell a can of peas and make 2 cents, and so on all through the grocery line.
The fruit and vegetable department of a store of this kind would be a gold mine. This department alone may make a net profit of 7% due to the tremendous turnover we would have after selling out daily and not throwing half the profit away, which is done at the present time in 25% of the chain stores throughout the land.

Then the big meat department. This would be a beehive. We would have the confidence of the public. They [would know] that every other grocery item they picked up they saved money on same, and our meat department would show us a very handsome profit. It wouldn't surprise me if they could not net 5% in this department.
... I was never so confident in my life as I am at the present time, and in order to prove to you my sincerity and my good faith, I am willing to invest $15,000 of my own money to prove this will be the biggest money-maker you have ever interested yourself in.

... Again, you may object to my locating two or three blocks from the business center of a big city. One great asset in being away from the business section is parking space. Another is, you can get generally the kind of store you want and on your own terms. The public will walk an extra block or two if they can save money, and one of our talking points would be, the reason we sell at wholesale prices is that we are out of the high-rent district.
... Don't let the buying worry you in any way whatever. I can handle the buying in fine shape. I could buy goods, ship them direct to my stores 3% cheaper than you could buy them, store them in a warehouse and put them all through the red tape that all Kroger items go through before they are sold.
... Before you throw this letter in the wastebasket, read it again and then wire me to come to Cincinnati so I can tell you more about this plan and what it will do for you and your company.
The one thought always uppermost in mind -- how can I undersell the other fellow? how can I beat the other fellow? how can I make my company more money? The answer is very simple: by keeping my overhead down, and only by keeping this overhead down, can I beat the other fellow.

Read More:

Monday, November 16, 2015

Walmart vs Amazon

Walmart is the largest retailer in the world, by far. It is at least 4 times bigger than its first competitors. It owns a great knowledge of all components in retailing: supply chain, store management, operational cost management, pricing, merchandizing, and even E commerce, as it has invested massively those past few years in this field.

Nevertheless, when you look at the capitalization of Walmart compared to its Ecommerce competitor Amazon, Walmart is by far less liked by the bull market. Why? It is far more profitable, and has been profitable for years, whereas Amazon so far has no profits to show out.

  • E commerce remain the fastest growing retail channel
  • They still have a lot of categories to develop, including food and cosmetics products
  • They have new businesses growing up, especially market place, their cloud services, or kindle activities
  • Moreover, as they don't own store, they are more flexible to face market issues or to grow new countries without having to develop a pricy store network.

Nevertheless, Walmart has some real potential of growth ahead of them:
  • Emerging markets to conquer. So Far Walmart's presence abroad remains weak and a small share of their overal sales. They have real potential to benefit from potential growth of some zones like South America, Asia, or maybe the Middle East
  • Strong projects in E commerce. I believe Walmart has a real edge on its brick & mortar competition on this topic. They have a strong know how in terms of SEO, or click & collect in the US (I believe Carrefour maybe in advance wordlwide, as France is way in advance on the topic). 

Now Walmart in my open remain a sure bet because of its long period of time of performance and its consistency. But there is one key factor that sets Walmart and Amazon: AWS. Amazon web service is all the cloud computing activities of Amazon. It is growing fast, and highly profitable. Way more profitable in terms of % of EBITDA than the discount retail could propose. And Walmart is lacking such a profitable activity. Because of this activity, Amazon has a potential cashflow source that will feed its long term growth.

Interesting article, even though I still believe Walmart has great assets in the competition.

Friday, November 13, 2015

Retail Strategy: Target Launches A New Ecommerce Presence In Over 200 Countries

Target is one of the leading retailers in the United States and Canada. Nevertheless, they have a limited presence abroad. French magazine LSA has recently published an article announcing the launch of its Ecommerce website in over 200 countries

- 50% of the product range available on the US website
- Same prices than in the US
- Available in 60 different currencies
- In large international markets like The European Union or China

This is a very interesting move, because it is quite innovative to see a brick & mortar retailer trying to conquier new markets thanks to its Ecommerce website. Actually, another remarkable move have been previously made by Costco, settling in China thanks to an Ecommerce partnership with Alibaba.

I believe that this is a very interesting move. Ecommerce allow more flexible approach of new markets, either geographically, as does Target, but also new category to approach.

Now the challenge will be vast:
  • The supply chain: Target needs to find a solution to ship products abroad, and there will be issues with the cost of shipping, but also the time to deliver the goods.
  • The marketing: How could Target compete with Amazon, already settled in most countries. Moreover, there is already brick & mortar competition, and I don't really know how Target could position itself different enough to gain marketshares.
  • How could they manage their websites? I don't believe Target will have local management for this initiative. And they'll need people in order to advertize, to boost the activity, in order to have real results.

Thursday, November 12, 2015


Les tendances de la Valley, par 1000mercis... par PetitShow

I wanted to write this blog post after having watched this video. CEO of 1000 mercis Yseulys Coste is speaking about the hypest words in the Silicon Valley at the moment: Incrementality and people based marketing. I wanted to get some thoughts on the first item.

Indeed, Incrementality is the graal of marketers: Being able to have a clear identifiable impact on sales, and hence, on the results of a company. Today, thanks to big data, we have more and more information that could help in this quest of identification. Same thing for category management and retailing: If I enter a new SKU, how much extra sales could I expect from it? Moreover, how much it will cost me to extend my product range (the infamous COGS I discussed several times here).

But this quest is far from being easy. Nowadays, we have so many factors that could impact sales that it is difficult in a 360 marketing approach to measure individually each factors:

  • The quality of the product: Something that people tend to forget, but if you have an average innovation launched in a crowded market, your elasticity will be low
  • The mass media advertizement. Even though going in limbo compared to Internet and social media budgets, mass media like TV, radios or billboarding are still very efficient sales booster, even though it is hard to link direct sales to it.
  • Retailing effort: You know it is my forté, but you need to invest in your retailing channel (as a brand). End of the aisle display, interractions with the shopper, make sure you have the right stock available in store not to miss sales.
  • Of course, Direct marketing campaigns, including social media, emailing, or even website visiting, where you can have a lot of info about the shopper path toward the sales.

Here are also some aspects you need to take into consideration:

Behavioral Data
One of the key component of segmentation today is to be based on customers behaviors. Indeed, social and geographical segmentation is no longer applicable, as customers adopt their consumption based on what they believe rather than historical background.

Dividing your Data Base into 2 Groups
One of the best ways to measure incrementality is to have two groups of people: One who will see the ad, and another one that won't see it (for example, one will receive an email, the other don't). Three aspects to keep in mind:

  • Let's not forget that you won't master the other aspect of your 360 marketing effort. For example, do you know that your first group of people has seen no products in its local store? It has not seen the billboard campaign? It has been away on vacation at the moment? 
  • One of the issue that I have is that it is ok to test, to experiment, in a R&D effort. But if you really want to have a deep impact on sales, it is also important to have an impact on 100% of your data base. And that is something sometimes CRM experts tend to forget.
  • You need to have large enough groups, and specifics group, in order to extract real information of the testing. If you do it on a data base lower than 10% of your overal data base, the info won't mean much. Moreover, if you have only 100 people for the test, it won't really be good infos either.

The topic is wide and interesting. I 'll probably write more in posts to come.

Wednesday, November 11, 2015

Is The Golden Age Of Western Corporation Coming To An End?

If you know me well enough, you may know about my passion of history. I am an adept of the adage "you need to know well your past in order to understand your future". Actually, I am currently writing a book which is mixing my interest in history and my professional skills and knowledge, but so far, can't talk much about the topic, as it is relatively new (I wrote about 50 pages so far...).

Among other topics, I love history of business. I read this very interesting article about the Economist, which put into prospective all the changes that happened the past two decades about the way we conduct business as westerners. Indeed, we, Westerners, meaning mostly Europeans & Norther Americans, share a strong culture:
  • We share the same Christian background
  • Core values where democracy is a key part
  • A common history, based on the colonies, but also the second world war and the cold war, that strengthen our relationship
  • Businesses that work about the same.
But that world, which has been thriving, experiencing one of the most tremendous growth ever the past few decades, is right now at a crucial stage. Our culture tended to assimilate other cultures, by bringing a "superior" culture to the new countries where we were going to. Now this concept is not so easy. We are in the globalization age, and global companies need to adapt at least as much as the local businesses need to.

Here are two of the main factors detailed in the article.

  • The emerging market growth: It is shaking up our world, as it is now leading some industries, innovating faster than us.
  • The growth of new technologies in the share of the global economy: This new competition is based on new business models, that are hurting traditional businesses, as we can see with Uber, Alibaba, Facebook or Netflix
It is actually when the Roman Empire was enable to assimilate any longer its barbarian people that it started to fall down. Because barbarian took benefit of the Roman weaknesses to take over the different provinces.

Is it the end of the golden age of Western corporation as the article explains? Probably. Probably something brand new is showing off. With a new way to conduct business. What could be interesting is to see how our "paradigms", our 4 Ps, our IPOs, our mission statements, our mass media campaigns adapt to the new landscape. 
The crisis we are experiencing right now, may actually be a stage toward a new world, that could be ten times better than ours.

Tuesday, November 10, 2015

Quelques pensées sur l'arrivée de Whilelm Hubner à la tête d'Auchan Retail

C'est l'une des nouvelles les plus importantes qu'il y ait eu ces dernières semaines dans la distribution en France, les changements à la tête du groupe Auchan, qui ont conduit Whilelm Hubner à la tête de la division Retail.

Cette réorganisation intervient alors que les résultats de la division française sont difficiles et ce depuis plusieurs années. Les modifications de structure opérées par la précédente direction n'ont pas permis ni d'améliorer la rentabilité, ni de pouvoir influer sur la baisse de chiffre d'affaires notamment de la branche hypermarché.

On lit beaucoup de choses dans la presse sur Whilelm Hubner, comme quoi se serait notamment une personne très peu connue de la direction d'Auchan, et que sa nomination est une petite surprise. Pourtant, Whilelm Hubner:
  • a été directeur de plusieurs magasins en France, notamment dans le nord de la France, le giron historique de l'enseigne
  •  a été patron d'Auchan Vélizy, 1er magasin européen toute enseigne confondu avec ses 300 millions € annuels. Il a été notamment présent lors de la rénovation de ce magasin à la fin des années 2000.
  • a été patron, très peu de temps, de l'Ile de France, la 2ème région française
  • a été patron de la Russie, le pays fort de l'enseigne, avec des magasins dépassant les 300 millions d'euros, des croissances bien souvent à 2 chiffres ces dernières années.

 J'ai eu l'occasion, bien que peu de temps, de travailler avec Whilelm Hubner, lorsque j'étais chef de rayon à Auchan Vélizy. J'ai beaucoup apprécié sa personnalité, son charisme, sa gestion des équipes. Il incarne pour moi le meilleur des valeurs d'Auchan: le commerce, le management d'équipe, la maîtrise des basiques, mais aussi un réel esprit d'entreprise. C'est une personne ambitieuse, avec une vrai force de conviction, basée sur son charisme, mais surtout sa connaissance du commerce.

Maintenant, le grand challenge sera effectivement de pouvoir bien appréhender le multi canal, et notamment la partie E-commerce (mais je ne m'en fait pas trop, il y a de vrais compétences pour l'épauler à Auchan, et Whilelm sait déleguer). Mais également la gestion des autres formats que l'hyper, pour un pur produit de l'hyper. Car aujourd'hui Auchan a beaucoup de tests et de formats qu'il faut consolider: les Simply Market, les A 2 Pas en proximité (qui est un vrai savoir-faire encore sous développé chez Auchan), etc...

Je souhaite bonne chance à Whilelm, et suis certain de sa capacité à pouvoir relever l'intégralité de ces défis. S'il y a bien quelque chose qui me surprend dans sa nomination, finalement, c'est qu'elle ne se soit pas fait avant...

Monday, November 09, 2015

Drugstore and Pharmacy Business: Rite Aid To Merge With Wallgreens

It is very interesting what is going on in the healthcare retail business. Indeed, we can clearly see a lot of transformation into this business:
  • Less regulation, and the will of governments to empower more retailers in order to ease the access to medications.
  • New category approaches by market leaders, especially CVS
  • A lot of new competition coming from other retailers, especially FMCG specialists such as Walmart or Target.
Recently, Rite Aids and Walgreens have agreed to merge their business, to create a healthcare tycoon counting for 40% of market shares.

Obviously, the terms are still discussed, especially as antitrust regulation will probably apply. But why this deal? Primarly because the market is getting tougher, and in order to secure high profitability for both companies, they'll need to leverage synergies, especially in terms of negotiation powers against the major pharmaceutical companies.

This merger has also a strong goal:
“With the physician shortage, the access to primary care physicians will likely be lowered for many patients,” Turk said. “Instead of seeing your primary care provider, you may have to interface with someone at Walgreens to help you dispense your medication.”

Obviously, it is a main trend going on in the healthcare business, and having a strong network of pharmacies with skilled and trained employees to help you with your medication is a key in order to keep groing the business and also to answer some real questions about what the future of health care will look like.

Friday, November 06, 2015

Sephora Flash

Sephora has recently opened a new store concept in Paris named Sephora Flash. The purpose of the store is to try the new technologies in store to improve the shopping experience. You will see a video (in French) below showing you how the shopping experience goes.

The key concept in the shopping experience is the NFC cards allowing the shopper to get information on the product and compose their "digital basket". The idea is simple, based on showrooming: The store, whith counts only for 100 square meters, holds as much products as their larger store of 1 500 m2. How, simply because they have very few stock in the shop. They count on home delivery and the day after delivery in store.

Now, to me, the concept has been base on the problematic of the size of the store. The goal is probably to propose the larger product range as possible (the one the standard concept needs) in smaller places.

Moreover, the retailer has an opportunity to test its new technologies in order to understand better how to use them in terms of customer relationship management. This is the reason why they have a robot to give advices on top of the standard employees they usually have.

Now The only thing that seems to be lacking is obviously beacons. Because why would people use small NFC cards while they could use their phones to have extra content, even maybe more personalized?

Also, it is interesting to have a look at what Sephora does with this store, as obiously the luxury goods and cosmetics product categories are most of the time in advance in terms of usage of new technology and new trends. Even if you are a FMCG retailer you shall have a look at this cutting edge concept.

Thursday, November 05, 2015

Thoughts On The New "Like Button" Of Twitter

This week Twitter changed its favorite button to a "Like" Button. The new button has replaced the star icon by a red heart one. Why such a move? Actually I am really wondering why they have changed.

Moreover, I believe there are features missing in Twitter, and it has been a while they could have add them up:
  • Categorize a tweet in a specific category
  • Add a keep it for later category.
Actually, I was using the favorite button for that matter: keeping some interesting tweets to read and think about later. Which was actually not really a "favortie" action. I actually was eager to have a button just to show my acceptance of something, but my usage of it did not allow me to.

Moreover, why using the "like" word? To look a bit more like Facebook? I am a bit lost in this change.

Also, I have noticed recently they added a poll feature, which is actually really cool an d easy to use. 

Hope the new features I need will be available soon.

Wednesday, November 04, 2015

Why A Weaker Black Friday Is A Good Thing For Retailers

We are approaching the time of Black Friday soon. Black Friday is obviously a key date for any US retailers. It is the day when usually retailers start to break the even point and earn money. It is so huge in the results of US retailers that French retailers have started last year to launch this sales season, in order to boost sales before Christmas.

But I believe that this change in consumer habits is a good thing for retailers. Indeed, it is never good to concentrate too many sales on such a short period. Also, promotions are great to generate traffic, boost sales, and get marketshares, but as everyone concentrates their effort on the same date, a lower promotional pressure may allow retailers to improve profitability.

Anyway, Black Friday will still remain one of the top date for retailers, and an important event not to miss.

Tuesday, November 03, 2015

Récoltez des avis consommateur en magasin

Une présentation intéressante réalisée par Altavia sur les différentes alternatives à mettre en place en magasin afin de récolter les avis de consommateur. En effet, il est toujours intéressant d'avoir le ressenti des consommateurs lors de leur parcours d'achat, et en essayant un maximum d'avoir des informations sur leur ressenti, et ce de manière récurrente, cela permet de pouvoir travailler l'expérience client de manière assez poussée.

How to Pack Like A Pro

Wether it is for leisure or business, packing to travel (especially by airplanes) could be a hard task. You need not to forget anything, but also make sure everything fits perfectly.
Here is a very interesting video about some techniques to use while packing. Some of them I was not doing, especially folding clothing one in another. Quite interesting.

We are approaching the Christmas holidays season, some it could be good if you watch it before flying to your vacation house.

Monday, November 02, 2015

Category Management: Du rôle de la MDD

La marque de distributeur, ou marque propre (ou MDD), représente les produits qui sont commercialisés par une enseigne sous sa marque. En conséquence, elle revêt un intérêt stratégique:
  • Elle porte le nom de la marque de l'enseigne, donc est vecteur d'image
  • Elle permet de se différencier. En effet, la MDD est unique à l'enseigne, et donc différent des produits de marque nationale que l'on peut retrouver dans toutes les autres enseignes.

Depuis quelques années dans la grande distribution française son rôle est mis à mal. En effet, face à la guerre des prix, 2 facteurs concomitant ont réduit l'intérêt des MDD:
  • La baisse des prix de marque nationale ont diminué l'intérêt relatif pour le consommateur de payer moins cher une MDD.
  • La MDD a bien souvent été utilisée comme outil de péréquation pour recouvrir des marges mises à mal.
Néanmoins, je reste souvent surpris du manque d'intérêt actuel pour ces marques. Le seul distributeur qui joue clairement la carte de la MDD aujourd'hui, c'est Intermarché, notamment du fait qu'il est producteur d'une grande partie de ses produits MDD.

J'ai trouvé ci dessous un schéma clair, expliquant les fonctions de la MDD. 

Je pense que la MDD devrait revenir au coeur des stratégies des enseignes prochainement, car leur intérêt est indégnable.