Mutation of the French Hypermarket model

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Mutation of the French Hypermarket model

Article Date: 30/11/2018 

 

Finnian O’Luasa, Paris Office, Bord Bia – Irish Food Board

As mentioned in a recent food alert, 2018 will be possibly remembered as one of the greatest years of change in French retail with concentration of purchasing powers, alliances between online and offline giants and the race for urban markets. In a recent interview with the ex CEO of the French retail group Systeme U, Serge Papin announced that the “evolution of society is announcing the end of Hypermarkets”. He explains that Amazon replies to today’s modern consumer behaviour and that by 2030 most of the purchasing power in France will be concentrated on the French Atlantic and Mediterranean coasts as well in the 22 major cities. This will create a population of active young urbans, 30% of whom will be living on their own with individualistic behaviour. The fact that Amazon is worth 53 times the stock market value of Carrefour and 164 that of Casino is symptomatic. It can also be observed that in cities the food offer is being more fragmented where inhabitants eat more in restaurants, rely on home delivery or shop more in street markets. Physical retail stores therefore will need to adopt. Possible changes mentioned are investing in consumer experience, concentrating on artisanal skills, reconnecting stores with production, producing private label products with higher consumer value, deliver high quality “ready to eat” products.

The Auchan urban farm concept is an example of this adaptation The group have purchased 1000 ha of agricultural land around 50 of their Hypermarkets. Local consumers can become shareholders of these urban farms which will produce organic certified food and grow vegetable varieties in danger of extinction.

The changes being witnessed in French retail are driven by changing consumer trends, many of which are global. Bord Bia’s consumer lifestyle trends gives an in-depth analyses of how these trends are influencing consumer behaviour.



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