An incomplete sollution
Category : Random thoughts
Carrefour just launched it’s own discount product-line: A limited set of low priced, widely needed products for households. With this, Carrefour hopes to counter the loss in customers that they suffer from real discounters like Aldi & Lidl.
Will it work?
High level analyst from financial institutions have their doubts and say that the product range is too limited. If Carrefour wants to pull this off, they need a much broader product range of discount products.
I do think the depth of this product line is not that important as these analysts say it is. Off course, you need more than 10 products, but I guess it is not’s Carrefour idea to really go into direct competition with real discounters (talking about a bad idea…). The main idea probably is to make sure that the most price sensitive customers (but that are still no real discount-lookers) and the people that – forced by the crisis – become more price-sensitive, stay shopping at Carrefour. This of course without cannibalizing on the business model of Carrefour that is still premium-branded supported.
If they arrive in convincing their customers that there is no need to go to Aldi for a part of their shopping bag content, they succeed. And for this, the number of products is irrelevant, it is just the client perception.
This said, they are not there yet in my local Carrefour. The discount products are put in the middle of the shop real messy. I understand that it is discount, but Carrefour could easily makes “discount” more sexy… and thus creating a competitive advantage towards discounters.
What really should be revolutionary is to create the inverse: A shop in the shop with only a very limited offer of premium and own brands (one product in every product group) for the people that value time more than cash. Because also this is a scarce good… even in times of crisis.
Retailers that are interested in having a talk on this can always contact me 😉