Wednesday, November 7, 2012

Supermarket and Hypermarket strategy in China

Carrefour, Wall-Mart, Hyper-Mart... supermarkets and hypermarkets invaded China.
When you come inside a supermarket in China you feel lost: it is very big, there are many people, many products.

I thought a lot about it. I stayed and watched customers in several supermarkets. And I believe that I now understand the overall strategy of supermarkets in China. I am even a little proud about this :-)


Supermarkets and hypermarkets strategy in China.

The context
  • First you must know that Chinese traditionally love cooking. 
They are expert in cooking:
They want fresh and quality ingredients. 
They also compare prices a lot! vegetable, fruits, meat, fish...
  • You find everywhere in China small stores, street vendors and markets. All offer Chinese cooking ingredients: meat, fish, vegetable, fruits... You also find shops that sell everyday products at competitive prices: biscuits, shampoo, toilet paper...
  • Chinese people shop everyday and only very few Chinese buy large quantity at one time: shop once a week for example as we often do in Europe.


In these conditions, how can supermarkets establish themselves in China?

  • They can not offer cheaper price or higher quality products since competition is so fierce!

Find the answer in photos:

  • Build a low price image:
Attract and comfort customers with discount advertisement: . In fact, price are almost identical between supermarket and street stores except for a few products: yogourt, biscuits, shampoo...
http://www.monalbum.fr/GroteFoto-NQKR7NOP.jpg

Just in front of the supermarket, a skating ring and courses. Probably offered by the supermarket.
http://www.monalbum.fr/GroteFoto-BLC3HHYY.jpg


I come inside the commercial center: a shopper and her son
http://www.monalbum.fr/GroteFoto-7PHET6XY.jpg

Yogourt display: women and children + a few fathers
http://www.monalbum.fr/GroteFoto-S8GWETW7.jpg

Children select. Parents pay.
http://www.monalbum.fr/GroteFoto-6LV8EWK3.jpg

Another mother with her child
http://www.monalbum.fr/GroteFoto-3DVB8FYS.jpg

And again
http://www.monalbum.fr/GroteFoto-HZSQQ4YG.jpg

And again!
http://www.monalbum.fr/GroteFoto-4E66OPQJ.jpg

And even grand parents: the trolley his full with products for her grand daughter
http://www.monalbum.fr/GroteFoto-WTTZMK4J.jpg


Conclusion:

Supermarket and hypermarket strategy in China:

  • Attract children. Children come together with their parents and grand parents
  • Convince parents to come on their own:
To do so supermarkets emphasize on cheap price and discount: apparently cheaper than elsewhere. 
There are also a few exclusive products and more choice; alcohol, bread, cookies, make up...


Supermarkets and hypermarket have a clear and simple strategy. Everything gravitates around children and young people. Supermarkets offer specific products in order to attract them. They also develop different attractions for children and young people: cinemas, sportcenter, kidengarten...
Children and young people will bring their parents. As a second step in the strategy, supermarkets convince parents to shop there.


Space division in supermarkets in China is also simple even though it looks complicated:
  1. Products for daily life: clothes, linen, cooking tools, shoes... They aim to develop a global offer. Customer will buy all in one place
  2. Produits to attract children and teenager: drink, sweet, cookies, imported products...
  3. Products for mothers: cooking ingredients: vegetable, fruits, fish, meat...
  4. Unique products: to attract children, young people and teenagers + convince parents to shop there


This strategy is the main strategy that you find everywhere in China. 
However today it is not the only exisiting strategy for supermarkets. You see new strategies even though this is still very new.
Chinese consummers change quickly. 
New customers groups appear in a few cities, districts and fall for different strategies: organic products, health, luxury products, foreign products, "made in China"...

2 comments:

  1. Good to see that the Chinese people have kept fun activities along with their supermarket. I wish cousins supermarket should also keep the same events to get more attraction of people as well of kids.

    ReplyDelete
  2. Yes I agree! I also noticed in France there are too few events organized by supermarkets... Many years ago it was much different.

    ReplyDelete