Carrefour report

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CARREFOUR
Report n°2 October 6 , 2006
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Lise GOUSSET (France) Sébastien GUERRI (France)

4,417 words

October 6 , 2006 – Page 1

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INTRODUCTION
Carrefour is the second largest retail group in the world, and the largest retail group in Europe. It has various formats of stores in 30 countries in Europe, Asia, and Latin America.

We described in the first report the groupCarrefour and its brands, its strategy, its ethics and social responsibility, and its human resource management. We will now describe the marketing structure of Carrefour Group and then we will provide a financial analysis.

Lise GOUSSET & Sébastien GUERRI

KTH – Royal Institute of Technology – Stockholm

October 6 , 2006 – Page 2

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MARKETING – PRELIMINARIES
C USTOMER RELATIONSHIPMANAGEMENT
As in many other businesses, it is a crucial point for the Carrefour group to learn about their customers and to do everything they can to satisfy them. Thus Carrefour has defined what builds up a positive experience for the customer: apart from the marketing mix, you can see that many other factors contribute to the customer’s decision-making on the diagram below.

PART 1:

Socioculturalinfluences

Situational influences

As we have explained in the first report, it is a good idea to keep customers as it brings in a lot of money. The group seems to be quite successful at keeping customers as 67% of sales are made using the Carrefour card.

MARKETING RESEARCH
There are several sources of information which enable the group to understand the customer. Their primary sources ofinformation are: - In store studies and surveys after check-out - Mystery shopping - Focus groups

Lise GOUSSET & Sébastien GUERRI

KTH – Royal Institute of Technology – Stockholm

October 6 , 2006 – Page 3

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Round table discussions Analysis of other retailing formats Competition watch (they do quite a lot of benchmarking – for instance when Leclerc was better thanCarrefour a couple of years ago, Carrefour compared its processes and products with Leclerc’s in order to improve its own’s) Image study Price surveys (they often use external professionals) Customer database (analysis of sales receipt, loyalty cards) Customer response to offers (Analysis of marketing effectiveness) Daily interactions with customers (in store, call centres, mail)

Their secondarysources of information are: - INSEE (French Institute of Statistics and Economics Studies): demographic trends, population observation - Suppliers studies for categories of products

TYPES OF PRODUCTS THAT ARE MARKETED
The Carrefour Group mostly sells consumer goods and services such as: - Convenience goods (food products, gas) which are sold by all formats of retail stores. - Shopping goods andservices (household appliances, electronic devices) which are sold by hypermarkets only. Cash & Carry and wholesale stores sell industrial goods (mostly food) as they sell to businesses (food trade professionals).

MANAGING PRODUCTS LIFE CYCLE
In order to offer the best possible product mix, the group needs to manage products life cycle efficiently (this is mostly useful for supermarkets). If theyhad to offer the same range as retail specialists across 10 categories, they would need 25,000 m² just for non-food goods. But hypermarkets sales floor areas only range from 3,000 m² to 20,000m²... Thus, they have to decide which kind of products to sell (choosing the ones that will sell in greater quantities or with the more profits) and when to sell them. Let’s give some example to understandhow it works. For a new DVD title, 10% of the sales are realized the first week, and 40% in 15 days. So you will most probably find lots of new DVD titles in Carrefour in a large amount, and fewer old titles, with only a few DVD’s of each kind on sale. For Christmas, lots of games are sold, so the range of toys on shelves is much wider than during the rest of the year.
Lise GOUSSET & Sébastien...
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