Member Article

Casino Group finds success in re-imagining retail and convenience stores

It’s a public secret that the retail sector is in a critical period of transformation which will inevitably lead to the rapid erosion of outdated economic models. That of hypermarkets is particularly challenged, and mass-market retailers must now adapt to new lifestyles and consumption patterns. French supermarket chain Casino Group has already shifted its focus to convenience stores, as the company looks to bolster its hold on the French market while launching innovative changes to the sector.

It’s all about foresight. Last month, the French company launched ‘Le 4 Casino’ in Paris, a place where “digital services enhance and simplify the day-to-day shopping experience”, offering customers an array of organic, vegan, and gourmet products complete with an on-site co-working space, wine cellar, and chef. The new store concept is the collaborative achievement of fifteen different partners from the retail industry, such as startups and renowned brands, which were brought together with a single objective: using digital technology to enhance the customer experience.

“The retail business is now innovation-centric, and this goes beyond mere technology”, Casino Group Chair Jean-Charles Naouri said. “This new concept embodies an entirely new mindset based on constant adaptation, with a view to more effectively anticipating and meeting consumer expectations while maintaining close, trusting relationships with the customers who shop at our banners.”

Earlier in June, the supermarket firm embarked on a new venture with L’Oréal, opening two stores known as “Parisian drugstores.” Located in the Ninth Arrondissement near the Grands Magasins and the Saint-Lazare train station, these stores target urban young professionals, for whom “the lines between work, culture, and fun are being blurred, creating a new way of living,” according to Casino’s Chief Executive of convenience banners Jean Paul Mochet.

The stores, which opened in June, offer 4500 products and 285 brands focusing on health and well-being, and offer a host of amenities for young people on the go: both stores are equipped with free wi-fi, charging points for electronic accessories, water fountains, shoe-shine machines, sinks and dressing tables, and parcel pick-up points. The stores even offer a “light therapy area” for those needing a winter pick-me-up.

This new drugstore format hopes to draw customers in with its low prices. More than half (55%) of products sold in the new stores are €10 or less, while 30% of available products are less than €5.

Plans are in the works for a third Paris store, and Casino is considering expanding the franchise to other European cities, as well as in Brazil and Colombia, where Casino already holds a market share.

The success of these new drugstore models points to the power of collaboration, Jean-Charles Naouri said. The stores are proof “that major companies are able to come together to invent and create unique, original places in line with contemporary lifestyles.” Casino has also introduced major changes to its Franprix chain, a convenience supermarket branch based in and around Paris. Under the direction of Mochet, the store has adopted the ‘Darwin’ model, aiming to adapt the stores to the new modes of consumer activity. Now, instead of being a dash-and-go convenience supermarket, Franprix is offering a wide range of services and catering for its customers.

“Our ambition was to be the fridge for Parisians. We became their lunch restaurant, tomorrow we will be their kitchen,” the Franprix team said in a statement. In a new store launched in the 11th arrondissement in June, Franprix is offering customers space to experiment with in-store tasting of products, as well as a catering section which offers a choice of several menus. Franprix also sells full meals, plus dessert, for the price of a restaurant ticket provided by employers.

Early morning shoppers are also able to pick up breakfast – and eat it on the spot. The seating space comes with toasters, and a wide variety of breakfast goods such as lemon cakes, brioche slices, and cookies.

Franprix has also reconfigured its product offering to appeal to visitors who are staying in local AirBnBs. It has expanded its offering of mini-bathroom products, while an in-store service counter serves as a parcel delivery point, a photo printing centre, and a place to hold keys for rentals.

Along with its Darwin concept, Franprix has also embraced the Noé brand, which encompasses organic and eco-friendly wares. In its new store, customers can avail themselves of aromatic herbes available for free near checkout counters. To cater to the more ecologically conscious consumers, Franprix has also removed all packaging from fruit, vegetables, and other produce, as well as minimised packaging on meats and fish. Though customers appear to have responded positively to the changes, it hasn’t been all smooth sailing for the Franprix brand. The Casino Group has taken initial steps to export these stores to Belgium, which has not gone as smoothly as hoped. Its first Franprix in Brussels has struggled to obtain permits, and have otherwise found that it is costly and time-consuming to provide products with both French and Flemish packaging. Amazon, too, has benefited from Casino’s strengthening position in the local retail market. Monoprix, another of Casino’s upmarket subsidiaries, teamed up with Amazon Prime’s delivery service starting in September. Monoprix Chief Executive Regis Schultz told Reuters last month that the number of orders has already been two to three times what the two companies had expected: “We are ready to follow Amazon’s deployment in all big French cities. They are likely to make the announcement when they are ready. It’s part of their plans for sure.”

In the end, the supermarket chain seems to have benefitted from its focus on its convenience stores, as Casino is one of only two players in the French supermarket sector to record double-digit value shares in the past year. The convenience store sector is undergoing major transformation, and Casino Group is now well-positioned to benefit from that move.

This was posted in Bdaily's Members' News section by Gabriel Wright .