Tuesday, May 31, 2016

Costco Launching A New Store Concept : Costco Business Centre

This is a news found in the Canadian newspapers. Costco will launch a new store concept in Canada near Toronto this fall. 2 other locations may be coming soon. 

What will be this concept about?
  • Focusing on business customers. Costco's sales are split in half between standard customers and business customers. But Costco's standard stores have a short limited product range, and sometimes, formats may not be suitable or most suited for businesses. Therefore product range will be adapted.
  • Standard customers will be welcomed. It won't be restricted. 
  • New specific categories will be available: Professional kitchen hardware, office gears and furnitures for example. On the opposite, toys, books, clothings, which are standard categories for Costco won't be available at all. 80% of the product range will be different.
  • New specific services: Costco will be offering 1 day delivery. Deliveries will be held by Costco's staff. 
This is interesting news, because Costco is not really familliar with twisting its original concept, especially as it works great. Nevertheless, they have already innovated by entering the Chinese market by setting an online joint venture with Alibaba. In terms of category management, this is also very interesting as they have really worked on different features to please the shopper:
  • Product range
  • Product categories
  • Services.

I can't wait to see how this strategy will unfold, especially as Costco is competing in different market with Metro which has almost a monopoly in the btob wholesale business. 

Sunday, May 29, 2016

Carrefour Is Strenghting His Board

Very interesting news in French professional magazin lineaires: Moulin familly (who funded and own Galleries Lafayette) has become the first shareholder of Group Carrefour, overpassing Bernard Arnaud & Colony Capital. 

This is a very interesting News. Indeed Carrefour's shareholding used to be divided in very small pieces, which complicated the possibility of the company to have a long term strategy.

Now Carrefour counts 3 main shareholders, counting for about 30% of the votes:

  • The Moulin Familly, which owns Gallery Lafayette, a retailer specialized in fashion and premium goods.
  • Groupe Arnault, which is also in the luxury business with its LVMH company.
  • Abilio Diniz, which is one of the trail blazer and most influential retailer in Brazil, a strategic market for Carrefour.
What I liked about this news is that it gives strength and purpose to the board, which can now focus on the retail business on a long term prospective. Moreover, those 3 shareholders have knowledge about the retail business.

I believe this will be interesting to see how they see the future of Carrefour.

CapitalDroits de vote
Famille Moulin (1)11,51 %15,33 %
Groupe Arnault (2)8,95 %11,92 %
Abilio Diniz (3)8,05 %nc
Colony Capital (2)5,23 %7,70 %
Bank of America Corp. (4)5,15 %4,53 %

Tuesday, May 24, 2016

CVS Invest In Curbside: Relationship Between Retailers & Start Up

It is pretty rare to see the name of a retailer (aside Amazon obviously) hitting the headlines of Techcrunch. But this time, pharmacy retailer CVS has invested in a Silicon Valley startup named Curbside, which allows customer to shop on mobile, and prepare the basket in store for pick up.

Aside of the innovative concept, which provides a better shopping experience, and is capitalizing on the large store network of CVS, I wanted to underline to me another very interesting trend.

Retailing is a business focusing on operations. And it needs to in order to leverage great results. But in our nowadays commerce land that is changing very fast due to Ecommerce, digitalization and mobile devices, using technology both to improve customer experience and to get an edge on competition is key.

We see in a lot of other industries companies acquiring innovative start up to get knowledge and technologies that could not be developped in a large corporation due to its structure and lack of reactivity.

And I believe retailers should really look closely at it. I know Carrefour has participated to a lot of start up events in order to build a bridge. But those investments will really pay off soon.

I believe it is time for start ups to look closely at retailing, and retailers at start up.

Monday, May 23, 2016

The Reason Why Walmart Is Raising Employees Salary

Walmart has always had a low salary strategy in order to minimize the operational costs of its store. Indeed, in a discount retail business model, wages are among the largest expenses. But as a matter of fact, it is also one of the best resources. Indeed, without people to manage stores, to put products on shelves, cash in people, keeping the stores clean and appealing, no much business is possible.

What Walmart has figured out is simple:
Walmart understood its ethic image goes through salary raises
For the longest time Walmart had a bad image because of its low salaries. Moreover, a lot of controversy came from how the government subvention Walmart by giving food stamps and health insurance to Walmart employees because they don't have enough revenues to sustain their familly.
Walmart needs to improve its image because obviously Walmart has a deep impact on communities.

The cost of bad employees
Walmart is known to have beyond 50% rate of turnover. This is big. That means they spend a lot of time and money in the recruiting process, but also on training those new employees, that may not last long.

This is the total opposite of Costco policy, which implies to pay more its employees to make sure of their loyalty and implication on the business growth.

Walmart's move is a big one. It will count for $1,5 billions next year. And in a difficult economy, it is always difficult to make such a move.

Category Management: Comments On End of the Aisle Displays

I got this picture from the Twitter feed of POSInsight. You can see a point of sales marketing display of a brand of milk. But I have several thoughts crossing my mind as I watch this end of the aisle display:

  • First of all, obviously, the display is great. The milk category is for sure one of commodities. It is therefore difficult to create difference between product, as the product is basic, and the way to create added value is difficult.
  • It emphasizes the fact that point of sales marketing is indeed a powerful medium. It could leverage sales at least as much as a TV advertizing campaign. Therefore it is important not to forget about it. It is always powerful to communicate while the customer is shopping. Thus you maximize your chance to be taken into account during the decision making process.
  • Nevertheless, I have a negative comment. I have been the category manager of the milk section. It is a large volume market, especially while you have commercials. This POS marketing has been designed for brand equity building. But end of the aisle display are great sales tool, and you need to generate as much sales as possible. And when I see the few products available on the display, I am sure that they would go fast out of stock.

So just to sum up what makes a great end of aisle display:
  • Theatralization: to be seen from the customer
  • Product availability, which is lacking in this example.

Monday, May 16, 2016

Cérémonie SCOPS 2016 du master Distribution et Relation Client de Paris Dauphine

Traditionnellement je me rends chaque année à la remise des trophées SCOPS 2016. Cette cérémonie est organisée par le master Distribution et Relation Client de Paris Dauphine, Master II spécialisé en distribution que j'ai eu la chance de réalisé. C'est l'occasion de voir plusieurs choses:

L'évolution du master
Que de chemin parcouru... Aujourd'hui le master possède des partenariats avec la plupart des enseignes et des industriels les plus prestigieux, intègre des voyages d'études, séminaire-neige, missions en entreprise, afin de pouvoir 1 - ouvrir leurs yeux sur la réalité du monde des affaires et des innovations, mais également 2- être le plus proche possible de la réalité des problématiques du commerce moderne.

On voit également le niveau de présentation à l'oral qui est juste bluffant...

Les innovations 2016
C'est le concept: voir les innovations de l'année, sur différents aspects, commerciaux, promotions, relations clients, etc... Cela permet de voir les tests, les tendances. Parmis elles, certaines feront l'objet de notes plus longues, notamment l' AfterClick 3.0, le mini dressing Pimkie, ou bien Oups Café au sujet du pricing. Comme quoi il y a toujours de l'innovation dans le commerce.

Revoir tout le monde
Le pot d'après la cérémonie est toujours aussi intéressant, car il permet de rencontrer et discuté les anciens, les étudiants, et les spécialistes du retail, dans un cadre sympathique. C'est bien de sentir toute cette énergie positive, loin du tumulte de la vie quotidienne.

Mais cette année, plus que tout, ce fut l'occasion, totalement légitime de rendre hommage à Michel Choukroun, décédé en début d'année, qui fut très clairement l'un des principaux protagoniste du succès de cet événement.

Ci dessous, vous retrouverez une vidéo de l'événement, que vous pourrez retrouver sur le site Carrefour un combat pour la liberté, ainsi que le live tweet que j'ai réalisé.

Practive Your Emotional Hygiene

We all encounter difficult time in life that affects our emotional state. We actually don't exactly know how to react at it, and the effects could be disastrous. You should watch this video I find very interesting, on how to train your emotional hygiene to prevent those stages.

Friday, May 13, 2016

Le discount joyeux: "pas assez cher mon fils"

Je voulais revenir sur un excellent article que j'ai lu sur le blog de DIA MART. Il discute des profondes mutations du commerce du discount. En effet, le discount, historiquement est associé à des concepts austères, la plupart de temps renforçant l'idée de bas prix auprès des consommateurs.

Le concept développé dans l'article est qu’aujourd’hui les gens ne veulent plus être complexés d'aller chez un discounter. Il veut pouvoir avoir des concepts joyeux, car ils affirment leurs droits à payer moins cher.

Cela m'a fait penser à une publicité, qui je pense à marquer beaucoup de gens: La publicité clio (Ci dessous). En effet, la publicité illustre bien l'idée. On peut avoir de l'argent, on a aussi le droit de choisir où dépenser l'argent, et donc d'acheter des produits discounts. "Pas assez cher mon fils".

C'est un peu la même chose que le concept de "everyone loves Walmart". Le client à le choix, est de mieux en mieux informé de la répartition de la chaine de valeur, et donc a besoin de plaisir également lorsqu'il achète peu cher.

Wednesday, May 11, 2016

Thoughts On Victoria's Secret Opening In France And Its Consequences On The Market

US retail chain Victoria's secret has opened its first store in France, at the Orly airport. It had already launched its retail chain in Europe, I believe it was in Belgium, and I remember to have seen one in a Hungrarian Airport.

Actually, Victoria's Secret don't communicate much about its International expansion, leaving commentators wondering what is next.

I actually believe that Victoria's Secret is simply executing a strategy implying a travel retail expansion, which ultimately means they need to open in several big airports to grow their network. Which would mean very few ambitions abroad.

But let's imagine Victoria's Secret open really in France. I believe it could be a big game changer. I have bee, a fan of the concept since I have visited my first store in the US: 
  • Focusing on the shopping experience
  • A great marketing with its events mixing great music superstars and top models
  • A large product range
  • With low prices
If Victoria's Secret would really like to come to France, it could be compared to the development of Kiko on the make up market.

The French market is a high price market, with actually very few changes. When Kiko came in, it proposed new innovative products, with a cool concept and low prices. Exactly the offer of Victoria's Secret.

It would therefore be interesting to see how it would grow because the historical actors would need to adapt to keep their market shares.

I will definitely cover for you the story if it unfolds.

Tuesday, May 10, 2016

Le marché des cosmétiques face à la révolution digitale

Article intéressant sur le site Les Echos. Il met en perspective tous les bouleversements que le développement des réseaux sociaux a imposé au secteur de la beauté. Aujourd'hui, effectivement, les acteurs historiques de la distribution de ce type de produit se retrouvent en face de challenges très important à relever.
C'est la raison pour laquelle j'aime le secteur des cosmétiques: il est en pleine transformation.

Néanmoins, je pense qu'on peut mettre un bémol sur ce constat:
-10% de part de marché pour le online (au UK)), certainement 15% à moyen terme, cela reste dans la moyenne des parts de marché du Ecommerce dans le marché global. Donc on n'est pas forcément sur un marché si propice au E-commerce.

- Par contre, ce qui a profondément changé, c'est la prescription, qui est un enjeu fondamental de la beauté: Avant les médias, et les conseillères sur le point de vente. Aujourd'hui, clairement, les blogs, Youtubeuse, avis conso en ligne. Et cela change profondément les raisons d'aller en magasin et l'experience shopper.

Friday, May 06, 2016

Kohl's Digital Strategy To Be Followed Up

I wish the best of luck to Sona Chawla, the new chief operating officer of Kohl's. She has been hired from her former Walgreen's E commerce chief position.

Why is it a great move from Kohl's?
  • First I always like woman to have executive positions as they bring a new vision to the business
  • Obviously, Kohl's is eager to move on with its digital strategy. Therefore, they are not affraid to hire someone who has accomplished most of her career in the Ecommerce business
But today, especially if you are Kohl which competition comes from both the brick & mortar  and the Ecommerce business, you need to be able to provide a true shopping experience blending the online and offline world. 

It will therefore be interesting to see what Sona Chawla is able to bring to Kohl in terms of digital strategy execution.

Tuesday, May 03, 2016

Etude sur le commerce en 2030

Intéressante infographie sur la manière dont les français se voient faire leurs courses en 2030. Le retail est au milieu du guêt d'une révolution digitale qui a déjà commencé depuis pas mal de temps:
  • Le développement de vrai concurrent online: Amazon et cdiscount en France
  • Le vrai multi canal existe chez la plupart des distributeurs: Drive, click & collect, activité e-commerce, etc...
  • La révolution du mobile et son utilisation en magasin pour prendre des décisions d'achats.
Mais où en sera t on en 2030? La question est intéressante. Car aujourd'hui, je pense que nous avons une vision un peu plus clair de ce que sera l'avenir du retail. Très clairement, le retail off line restera en général (et là je ne parle pas de certains marchés qui seront totalement en ligne) la majorité.
On peut voir également les problématiques du big data: le consommateur a de vrai réticence à avoir des informations communiqués sur leurs profils pour des fins commerciales. 

Monday, May 02, 2016

Amazon is Pushing Its Print On Demand Service To Limit Out Of Stock

We have previously discussed on this blog how bad out of stock could be for a retailer. Even though stocks could be pricy and have a deep impact on retailers results, out of stock creates customer insatisfaction  and missed sales.

Amazon is pushing its Print On Demand Service. The concept is simple. If a book is missing in the stocks of Amazon, instead of missing the sale, Amazon is printing the document once the customer has paid the document, and will deliver it at no extra costs, following the same terms.

Now, will Amazon push this system to print on demand a large part of its book offer? I am not so sure. I believe it will still remain more costly to print on demand than to stock books.

This is an interesting case study where technology allows Amazon to be more efficient to respond to customers demand.