Carrefour, Monoprix, Toys “R” Us… What strategy for Retail versus Amazon?

by bold-lichterman

20 years ago, Carrefour – or more exactly Promodès before its takeover by Carrefour – entrusted the company that I had co-created with the development of OOSHOP. Not just the e-commerce site, but also the back-office applications. An extraordinary adventure that leaves many memories, Carrefour being one of the first major global distributors to launch into e-commerce. Shortly afterwards, on the same basis, followed the sites of Picard (then owned by Carrefour), Carrefour Vins, Carrefour Beauté, etc.

20 years later, Carrefour merged 8 sites, including OOSHOP, into a single site, Carrefour; invests nearly 3 billion euros in particular to switch 50% of its stores to Click & Collect, to open 170 Drive. By 2022, 50% of its investments will be made in digital. This in a context where Kantar Worldpanel announced a few days ago that Amazon now represents 20% of French e-commerce, against 44% in the United States. The steamroller is running, and nothing seems to be able to stop it. Not just in traditional retail, but probably also in retail banking tomorrow.

The cards are redistributed. Takeover of Whole Foods Market, Amazon-Monoprix alliance, everything seems to be going very quickly now. With massive road trips like that of Toys “R” Us, as a reminder that now no one is safe.

But what has happened in 20 years? Or rather, what did not happen? It’s easy to give lessons and tax the retail giants with stagnation. Too easy. Large-scale distribution had to live through these years of transformation with its existing one, which considerably complicated the work.

The distribution often has a mixed image with the general public. Yet when you have been around the people who work there every day, that image is different. It’s a difficult job, but people are passionate about their store and their teams. They have a sense of customer contact. It’s a universe that runs largely on meritocracy. If you haven’t unpacked pallets like everyone else once, managed shelves, you just aren’t credible. Even high in the hierarchy, at least until recently, often appear former bosses of hyper, left at the bottom of the scale.

The stage is set. Large-scale distribution has lived for the last twenty years in fear of using e-commerce to saw off the branch in which it was installed. Fear that customers will switch to online sales, fear that the famous omnical strategy will turn into “showrooming” of stores (understand: people come to look in store to buy online). And you can understand shop owners in a way. But by pushing back the problem, by trying to find the impossible consensus on the subject within an often complex governance, water has flowed under the bridges. And a pure player has finally captured the value that we feared to see go. It was written, the branch had to be sawn off by someone.

Today initiatives are multiplying among all stakeholders. The Toys “R” Us effect can be. These companies, which have often played the card of caution, are announcing massive investments. But logistics have changed hands, and the mastery of data that Amazon was able to acquire at a time when GDPR and others did not exist will now be much more complex to obtain.

These investments are necessary. But, I remain convinced that the strength of large distributors also lies in their employees. Hundreds of thousands, millions of people spread across the field. People who are passionate about their profession, their department, people who often have created proximity with customers. Stores play a fundamental social role, and not just for the elderly who find there a way to break the isolation. People who come to buy a pair of running shoes at Endurance Shop come to listen to the advice of passionate, often multi-champion, salespeople with impressive track records. The seller of the bathroom department of a DIY specialist is a hit on Facebook because people have chosen their sink with him. Personally I do not believe in the survival of these ghost stores where after 10 minutes of research, you come to the conclusion that there is no seller. What’s the point ? Why not buy online then?

But to succeed, these millions of employees must also join the digital battle. Distributors occupy the social media field with national programs, but often struggle on local social media. It is the salespeople in local stores who can ensure the “last mile of digital”. If only through their network of friends. 100,000 people who each have a personal network of 200 friends, potentially 20 million people who can be affected. Much more efficiently than with company publications whose organic reach is known to be constantly shrinking.

Carrefour Monoprix Toys “R” Us… What strategy for Retail versus

In the United States in particular, and now in Europe, we are seeing initiatives emerging. The urgency is felt, and the “We’ll see” turn into “No choice, let’s go”. For me, it’s a chance to be able to work again with retail from the perspective of employees. It’s fascinating, and it’s inspiring to see people – who often only have their personal smartphone and not even a professional email address – enter the battle to defend their profession, their store.

But how ? It is not a question of asking these people to transform themselves into digital advertising signs. It is about offering them relevant content to share, but above all making them an actor in the content. Whether on their personal account or on the store’s local facebook page. Telling – usually in photos – the life of the store, arrivals, new products, teams; talk about the store’s latest sponsorship on a local event, etc. In short, to give a soul. Create an attachment to digital dehumanization. While structuring and organizing this new massive local communication.

It is also a question of encouraging these collaborators. The technology makes it possible to attribute the origin of a sale that is made on an e-commerce site to the person who initially shared an article on social networks. Or even to measure the “drive to store”, that is to say the people who came to the store thanks to a sharing on social networks. We must accept to reward these employee ambassadors, these social sellers, who have made an effort and who through their individual action bring people into the store or contribute to online sales.

Digitize the teams, but also digitize the store. And more than with Click & Collect. Every week I wait 15 minutes at the checkout of a supermarket for the freshest I want to choose. But I am cut off from the world. No 3G, but no wi-fi either. At the very least, why not open a wifi providing access to new store features, enhancing the teams, offering offers, etc., as most airports do? One of a hundred examples to illustrate the colossal digital in-store project.

For supermarkets, it is not a question of mimicking Amazon. It is too late for that. On the other hand, if it is possible to change the value proposition, the customer approach, by checking that the question: “Can Amazon do it today?” The answer is no, so we have to investigate. Omnichannel is part of the answer. But more specifically, the employees, the stores, the proximity to the “local”, today the poor relatives of the digital transformation of retail, are an undeniable, differentiating asset that is still under-exploited. It is high time to act.

Photo by Álvaro Serrano we Unsplash

The expert:

Carrefour Monoprix Toys “R” Us… What strategy for Retail versusSince 2003, he has been Chairman of Brainsonic, digital agency, and CEO of Sociabble, an Employee Advocacy and Social Selling solution present in Paris, Lyon, London and New York. He is also co-founder of Novathings (connected objects). Author or co-author of several books including Extreme Programming (Eyrolles), he works as an Advisory Board Member at Ecole Centrale Paris Executive Education.