Carrefour has just opened its new Planet concept in two of its stores in Lyon. I would like to take this occasion to analyze the essential elements of the concept - which will fundamentally change the very notion of a hypermarket: the increase in the number of brand shop-in-shops.
Two brands have entered with force: Apple, with a space selling the iPod and Mac, and Virgin with a cultural space. In both cases, Carrefour has drawn conclusions from its relative disappointment in essential non-food categories. I would summarize its reasoning in five points:
- The future development of hypermarket sales will come about through non-food - the categories that are not the core business of supermarkets.
- These are categories in which large specialty stores (Sephora in beauty / Decathlon in sporting goods / Leroy Merlin in DIY ...) have carved out very strong positions, and against which the large supermarket retailers have been impotent up to now.
- These are also categories where national brands could remain very strong (such as in beauty, fashion or electronics).
- Carrefour has therefore drawn the obvious conclusion: They must ally with the strongest national brands to re-invigorate entire shelf spaces… and attract a flow of customers. What we are seeing is a real cultural reversal (at least in France): making the national brand a true partner, and not an adversary.
- The cultural sector is a special case: Carrefour noticed the development of the Cultural Spaces at Leclerc and failed to duplicate them. The company was therefore obliged to join forces ... with a specialized retailer! This is another cultural rupture: a distributor installs its brand in the midst of the shelves of another distributor!
The French supermarkets have reached a new turning point: the powerful national brands, and the specialized retailers that were until today confined to shopping malls, now enter the hypermarket. In a certain manner the new model is a combination of the traditional supermarket and a department store. Supermarkets will gradually become renters of commercial space in their stores, and entrust their partners with the management of their own floor space (stocks, personnel). Consumers and brands will find this really advantageous: several of my clients, who "reclaimed" spaces previously managed by department stores, have greatly increased their sales by optimizing their replenishment, responsiveness and service levels. In this new model - which is also being implemented in the USA (Sephora at JC Penney and CVS Boots at Target and CVS...) - each partner finds its advantages, in terms of image, as well as traffic and sales. This can only spread to other categories: When will we find an H&M shop-in-shop at Carrefour Planet?