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On June 15 of 1963, Carrefour opened a shop that the French had ever seen before.The surface of the shop was
2,500m2, and it had 400 parking spaces as well. It was the biggest supermarket in France at that time. The French
named it hypermarché´ (hypermarket), which means ³bigger than traditional supermarkets. Learning from the
experience of American experience in retail development, Carrefour realized that the importance of No Parking,
No Business´.
Carrefour adopted the strategy of low-margin´ to attract the customer. The varieties of goods and price discount
really had much influence on the French traditional retailers at that time. For Carrefour, the hypermarket is not
merely the breakthrough of his selling skills, but also symbolizes as French Innovation .
Triple Strategy
After the success of Supermarket, Carrefour continues to step into his expansion strategies. We call it triple
strategy´: internal growth, cooperation and franchising.
1) Strategy of internal growth: Includes business-level strategy and corporate level strategy.
2) Strategy of cooperation: In order to increase its market share and reduce perceived risk, Carrefour cooperates
with his competitors by joint venture in France.
3) Strategy of franchising
Carrefour Challenge from America
1- Carrefour has invested outside France since 1969 and the first country that it expands abroad is Belgium.
From then on, Carrefour has expanded steadily. Now, Carrefour is 1st in Europe and the 2nd retailers in the
world. Carrefour makes its half of sales outside of France.
2-The most difficult global reach of Carrefour is confronted by Wal-Marts challenge. Wal-Mart is a global
company with over 1.3 million associates worldwide and almost 5,000 stores and wholesale clubs across 10
countries.
3- For Carrefour, the worlds second largest retailer, Wal-Mart has been the most threatened competitor.
Compared with Wal-Mart and Carrefour competitive advantages are completely different.
4- Today, Wal-Mart has ambition to step into his global expansion, and gradually this will threaten Carrefour
global reach.
Question 2: Retaining the customer by implementing various loyalty programs is ongoing
program in service organization. What were the measures taken by Carrefour to motivate
customer to visit the store frequently?
Answer: Customer retention is very important in any of the business. When it come to service marketing this
factor become more crucial. Carrefour has done a lot to make the customer loyal to the company. Following are
some of the measures taken by Carrefour to make the customer visit the store frequently.
The spacious and the comfortable shopping environment help the customer to spend more time in the store.
The merchandise was neatly displayed to help customer to easily find the commodities they needed.
In 1995 they introduce a loyalty program called SpesAmica, which was based on the loyalty card used by
the customer.
Customer details were collected at the point of sale, further data analysis was done to enable CF to identify
and classify customers on the basis of customer attributes combined with customer behavior.
To increase the loyalty, customers using the SpesAmica cards were given extra discounts, additional points
toward a gift in a prize catalog, entertainment offers, and special coupons.
CF also offers supplementary services like free delivery for big appliances, free shopping for the everyday
lucky customer, free parking, and goods return and exchange facility within 15 days etc.
Website and toll free number help the customer to register their compliance so that an immediate resolution
can be taken by CF.
Question 1: As a retail store, how has Carrefour gone about improving its customer service?
Discuss in the light of improvement in business processes and employee attitude.
Answer: Following are the steps that Carrefour took for improving its customer service-
1-In the 1960s, Carrefour launched self- service hypermarkets throughout France for
the better customer service, after that they subsequently expanded into other countries
also.
2-sIn 1999, Carrefour introduced Spectrum 24R wireless local area network
infrastructure and hand- held computers in its 68 stores in Asia. This system helped
improve both productivity and inventory management,
3-Carrefour also conducted employee satisfaction surveys from time to time and these
surveys were used as a basis for improving the work environment. As reward
measures, employees were awarded bonuses of one or two months ‘salary in case of
increased sales.
6-Carrefour also offered supplementary services in its stores in China- free delivery
for big appliances, free shopping for the everyday lucky customer, free parking, goods
retirn and exchange facility within 15 days, etc.