Algeria, Argentina, Belgium, Brazil, Colombia, Cyprus, Egypt, France, French Polynesia, Greece, Guadeloupe, Indonesia, Italy, Jordan, Kuwait, Martinique, New Caledonia, Qatar, Reunion, Romania, Spain, Taiwan, Turkey, United Arab Emirates

Key Formats

Hypermarkets and superstores, supermarkets, neighbourhood and convenience stores, discount stores

By PlanetRetail

Having pioneered the hypermarket concept back in 1963, Carrefour has evolved into the world's second largest, and one of the most international, grocery retailers. Its 15,000 stores – including hypermarket, supermarket, discount and neighbourhood/convenience stores – span the globe from Europe to Asia, Africa to the Americas.

At the beginning of the year, Lars Olofsson was appointed CEO, replacing José-Luis Duran. Unlike his predecessor who was a financier, Olofsson is a marketing man. All eyes are now on him to reinvigorate the Paris-based retail behemoth.

Olofsson, 57, was born in Kristianstad, Sweden. Prior to joining Carrefour he worked for 32 years with Nestlé, where he progressed from general manager of France Glaces Findus, to head of the Nordic markets, and then head of Nestlé France. In 2001, he was appointed executive vice president responsible for Europe, and, from 2005, he was in charge of strategic business units, marketing and sales. Olofsson led some of Nestlé’s fastest-growing brands, including Nespresso coffee capsules.

Keen on golf, skiing and tennis, Olofsson has a degree in business administration from the University of Lund, Sweden. As well as being fluent in French, he speaks English and some German.

Although Carrefour is an international company – currently generating 55 percent of its revenue overseas – France is nevertheless a key market for underpinning the retailer’s overall success. The biggest challenge for Olofsson will be improving the performance of its core French hypermarket division, which accounts for more than 50 percent of Carrefour's total sales in France. In particular, hypermarkets are struggling to increase sales

Chief Executive Lars Olofsson

Photo: PlanetRetail

of non-foods, where they are facing a shopper shift to buying in specialist outlets. In addition, hypermarkets face enhanced competition from smaller formats that are favored in the current planning environment.

In addition, Olofsson needs to question Carrefour’s neighborhood and discount store strategy and whether it is relevant to continue operating these two formats. Speculation surrounds the future of its French discount banner Ed, which despite registering growth in France, lags significantly behind market leader Schwarz-owned Lidl, with suggestions that it could be up for sale.

Carrefour has started to convert some of its neighbourhood stores, including a few Shopi stores into Carrefour Contact and Carrefour City, in line with its multi-format, single-brand strategy. However, with the neighbourhood stores almost all operated under franchise, it remains to be seen if these new concepts will be adopted by their owners.

By naming Olofsson, Carrefour’s shareholders opted for a marketing expert with a lot of consumer expertise. According to Amaury de Sèze, chairman of Carrefour’s Board of Directors: “Lars Olofsson has exceptional experience in consumer markets, built over more than 30 years, both in France and internationally,

Oloffson's biggest challenge is the financial recovery of the French Hypermarkets

Picture by Rennes, Brittany

within the number one global food industry group. His strong leadership and sales and marketing expertise make him the ideal leader for Carrefour to carry out the next stage of the Group’s development.” Olofsson will have to apply his expertise to the Carrefour brand, bolstering the retailer’s own-branded products, its multi-format store approach, as well as the convergence of stores under the Carrefour banner.

As growth is not only hard to come by in France, but in the retailer’s other key European markets – Italy and Belgium – Carrefour is increasingly relying on emerging markets for growth. The group is well established in China and Brazil and will continue to invest there. More problematic is Russia, where Carrefour is not yet present. It has declined to comment on reports that it was competing with Wal-Mart to buy St Petersburg-based hypermarket chain Lenta. With local retailers struggling with debt, price negotiations are being hampered although there are a number of acquisition opportunities. In India, market entry is underway but slowed by local legislation.

As part of its overall strategy, Carrefour aims to be among the top two retailers in ever market in which it competes, or it will consider exiting the country. Consequently, Olofsson must closely monitor the situation in Malaysia, Singapore and Thailand.

Having declared real estate as the group’s second most important strategy, the retailer fully intends to use property to leverage growth. Improving the management of its real estate was one of the reasons for Groupe Arnault and Colony investing in the retailer. Both investors have already seen their plans to unlock Carrefour’s property value postponed due to unfavourable market conditions.

Overall 2009 brings Carrefour’s new CEO major challenges, making it difficult to balance long-term strategic growth plans over short-term tactical issues.

Industry Affairs News

Association Leadership

GMA-FMI Accord Opens Up Collaboration,

Trading Partner Alliance

GMA Chairman Douglas Conant, president and CEO of Campbell Soup Company, and Food Marketing Institute’s (FMI) Chairman Stephen Smith, president and CEO of K-VA-T Food Stores, signed a joint memorandum of understanding creating a collaborative arrangement between the two organizations this month.

The agreement calls for greater collaboration between the manufacturer-retailer sectors and strengthens the industry affairs agenda of both associations through the creation of an inter-industry leadership group known as the Trading Partner Alliance or TPA. The TPA is charged with developing a common agenda on supply chain issues, the application of IT, the adoption of sustainable business practices and other issues.

The unified agenda will be executed by the staffs of both GMA and FMI, overseen by the boards of both organizations.

The agreement, which runs for this month until December 2010, provides for added collaboration in public policy, scientific and regulatory activity. The associations also agreed to host at least one joint board meeting and look for greater synergies in meetings to benefit the CPG industry.

Contact: Stephen Sibert

IAC & Science Institute Hold Meeting on Recall Policies

In an unprecedented meeting earlier this month, members of the GMA Industry Affairs Council (IAC) and the Science Institute, comprised of the leading science executives of GMA member companies, met to discuss product recall policies.

The top executives met in New Jersey to investigate all aspects of product recall from the initial product removal and replacement to the simultaneous sharing of information during a food safety incident. In-depth presentations were given on developing a uniform program and model practices on food safety notifications and recalls. President for Strategic Alliances at CROSSMARK Joe Crafton spoke on emergency preparedness, and John Kolenski, director of food safety and regulatory compliance at The Kroger Co. presented the retailer perspective. FMI Vice President for Industry and Trade Development Pat Walsh updated attendees on FMI’s recall portal solution.

Contact: Stephen Sibert

Supply Chain & Technology

Noted Leadership Development Expert Keynotes IS/LD Conference

The Speed of Trust: The One Thing That Changes Everything is the subject of the keynote address by Stephen M. R. Covey at the 2009 IS/LD Conference April 5-8 at the Marriott Doral Golf Resort and Spa in Miami. It is also the title of Covey’s bestselling book, which Marriott International CEO J W. Marriot calls “a great find,” and Deloitte Senior Partner William Parrett terms “red-hot relevant.”

Keynoter

Stephen M. R. Covey

Covey is co-founder and CEO of CoveyLink Worldwide. Formerly, he was CEO of Covey Leadership Center, which under his direction, became the largest leadership development company in the world. He personally led the strategy that propelled his father’s book (Dr. Stephen Covey’s The 7 Habits of Highly Effective People) into one of the top two slots as the most influential business book of the past 100 years, according to CEO magazine.

A bevy of programs lined up for the conference range from avoiding out-of-stocks and building a green supply chain, from harnessing technology to drive growth to data-sharing between trading partners. Also on tap is Director of North American transportation for Kraft Inc., Mike Cole, who discusses how two of his corporation’s programs have created greater visibility in transportation management.

Lora Cecere, research director of AMR Research Inc., leads a panel sharing insights on using technology – such as near-real-time data synchronization and coalescence of trade deal information – to enhance the effectiveness of direct store delivery (DSD).

IS/LD Conference Site in Miami

The conference will again be co-located with FMI’s Supply Chain Conference, with some joint sessions as well as many networking opportunities.

Visit the IS/LD Web site at www.gmaisld.com to obtain more information or to register for the conference.

Contact: Michelle Marcoot (Program)

Contact: Jonathan Downey (Sponsorship/Exhibits)

Accenture/IRI to Lead Product Lifecycle Management Project

The GMA Information Systems Committee named Accenture and IRI to lead its new research project on the impact of product lifecycle management processes and IT strategies on CPG innovation and growth. The report is due later this year.

Contact: Jeanne Iglesias

IS Committee Holds First Webinar Meeting

The Information Systems Committee reports its first meeting ever via Webinar was a great success. The committee reviewed a draft white paper on retailer-direct data, which it spearheaded with the assistance of Shawn Dolley of Vision Chain and Hollie Gonzales of CROSSMARK. The final report and findings will be presented at the IS/LD conference in April. The committee also heard from Accenture on the methodology it will use to research its product lifecycle study (see above). The next meeting of the IS Committee will be held in conjunction with the IS/LD Conference in April.

Contact: Jeanne Iglesias

Join Webcast on New Ways of Working Together

Mark your calendar on February 26 from 1 to 2 p.m. (EST) for a free Webcast on the latest pilot study on the New Ways of Working Together industry initiative. Sponsored by GMA, Oracle and the North American New Ways of Working Together Core Team, the Webcast focuses on their latest pilot study that was created to drive the development of a global standard for trading-partner performance measures. Oracle and The Coca-Cola Co., along with trading partner pairs, will highlight pilot study results and present a tutorial on implementation. To join the Webcast, e-mail jfinci@gmaonline.org.

Contact: Jennifer Finci

Quick Insights

Shopper Segments Vs. Consumer Segments

By John Dranow

Shopper segmentation can add value to both consumer and shopper insights. In many cases shopper segments can be used to supplement existing consumer segments or identify hidden segments and opportunities.

Understanding shoppers as they are making decisions is the key to having more accurate insights and actionable solutions. Consumer post-purchase responses lack the context and immediacy of shopper responses. An example of the power of shopper-centric insights is the following:

A manufacturer’s consumer data indicates that brand is the most important purchase-driver. However, shopper data indicates that symptom-related attributes are the top purchase-drivers when shopping for over-the-counter medications, for example.

Through in-store behavioral observations, we identified that 75 percent of shoppers are spending a considerable amount of time selecting products. Research indicates that when brand is the most important purchase-driver, shopping is a quick and decisive activity. Shoppers in this category are more involved at the shelf. When asked about their searching behavior, shoppers responded that symptom-related information was more important than brand.

Shopper-centric findings provide a full context by integrating shopper behavior and attitudes. Recommendations based on these findings result in the manufacturer moving symptom-related information from the side and back panels of the package to the front. It also resulted in optimal product placement on the bottom shelf, as behavioral observations noted a downward tilt in shopping patterns because many shoppers are not feeling well when they shop in this category.

Contact: SmartRevenue

Sales & Sales Promotion

Unsaleables Conference Set for July in Las Vegas

The 2009 Joint Industry Unsaleables Management Conference will be held July 28-29 at the J. W. Marriott Las Vegas Resort, according to GMA conference manager Brian Lynch.

The conference provides an open forum for multi-channel manufacturer-retailer discussion, knowledge-sharing and collaboration on this critical industry issue.

Mark your calendar and plan now to join your peers in Las Vegas to tackle operational, financial and organizational solutions for reducing unsaleables in the industry.

Contact: Jessica Martin

Salute to 2009

For generations in January each year, prognosticators predict what the new year would bring. The doomsayers among them might have been right about 2008, which the Chinese calendar correctly labeled the Year of the Rat. No one is sad to see it go. But what is the prognosis for 2009? The IAR has a few ideas:

Bid Adieu	What’s New
Eating Out	Eating In
Extravagant Fare	Homey Comfort Foods
“Paper or Plastic?”	“BYOB: Bring Your Own Bag”
Extra New	Tried and True
Splashy TV Ads	Shopper Marketing
Buying Up	Purchasing by Price
Blue-Chip Stocks	Black-and-Blue Stocks
GOP Rules D.C.	Demos Take Over
Selling as Usual	New Ways of Working Together
Hummers	Hybrids
Pâté and Caviar	Frugality and Home Gardens
Anything Efficient	Anything Efficient – and Green
Effervescent Home Values	Housing Meltdown
Manufacture: They Will Come	Building Consumer-Centric Products
Credit Cards	Savings Accounts

GMA Leadership Profile

Harris Fogel

Current Position:

In January 2006, I was named president, O⁴Corporation Americas, responsible for North and South American operations with the ultimate goal of helping leading consumer products companies implement next-generation mobile solutions for in-store execution, promotional compliance and direct store delivery applications.

Industry Leadership:

Chairman, GMA Associate Membership Council; Board Member/Co-founder, Procter & Gamble (P&G) Alumni Association-Atlanta Chapter; and Board Member, Trade Promotion Management Association.

Career Highlights:

“I’m proud of my involvement in successfully launching two world-class software companies with solutions specifically designed for the consumer products industry. It is extremely rewarding to be/have been a part of these companies’ development and growth, and, most importantly, to experience first hand the value that these solutions can drive for our consumer goods customers.

Personal:

“Originally from Augusta, Georgia. (No, I am not a scratch golfer.) Married for 21 years. Live outside Atlanta with my wife, Stacye, and daughters Allie (15) and Kerri (13). My hobbies include running and biking with my friends as well as spending time with the family on our boat, at the movies, cooking out or just hanging around the house.

Education:

University of Georgia, BBA, in finance

First Job:

“In high school and college, my first job was working at my father’s floor covering store where he decided I should learn the business from the ground up. Literally, I started off installing floors! It was a great experience in understanding that everyone in the organization directly contributes to its success. After college, I was fortunate enough to be hired by P&G as a sales representative, calling on retail stores in New Orleans. Starting my ‘official’ career with P&G was a great experience. My first role, as well as subsequent positions at P&G, helped lay the foundation of my passion for helping CPG companies become more effective and efficient in sales and marketing through process-enabling technologies.

How’d You Get Where You Are Today?

“I can say that when I graduated college, I didn’t have a grand plan of running a technology company focused on the CPG industry. That said, throughout my career, I have had people far smarter than I am provide good advice. I learned one thing quickly: To be successful, I had to take responsibility for my own actions, and I had to be a good team player. In business and in life, you can’t go it alone. It is important to build strong relationships based on trust; and – for those relationships to stand the test of time – they must be mutually advantageous. I have always looked for ways to add value to others, whether personally or professionally (the whole ‘pass it on’ mantra). Also, probably because of what I observed as a kid working for my family business, providing exceptional customer service and a great work environment have always been a high priority in whatever I do.

Key Factors for CPG Manufacturers During These Tough Times:

”To keep consumer loyalty both short and long term, CPG companies must continue to provide great brands at fair prices. From a business perspective, they must focus on investing in efficiency to make the most of every dollar spent. These investments can take many forms, including redirecting marketing and promotional dollars to the store to ensure on-shelf availability and influence at the time of purchase, thus increasing sales.

On Partnerships:

“As much as we would like to believe it, the world does not revolve around us. Building an eco-system of partnerships is critically important. Retailers and suppliers continue to find ways to work in partnership to drive efficiencies and serve consumer needs. Technology providers also collaborate and work together to leverage each others’ strengths and serve customer needs. Over the years, I have been fortunate to have partners – ranging from customers to consulting firms, from ERP to syndicated data groups – with whom I have worked closely who offer solutions designed to solve a critical industry issue. Working together, we can go farther faster and provide greater value.”

Datebook

April 5 - 8

July 28 - 29

Aug. 30 - Sept. 1

Information Systems/Logistics Distribution Conference

Marriott Doral Golf Resort and Spa

Miami, FL

Contact: Jennifer Finci

Joint Industry Unsaleables Management Conference

J.W. Marriott Las Vegas Resort

Las Vegas, NV

Contact: Jessica Martin

2009 GMA Executive Conference

(By invitation only)

The Broadmoor

Colorado Springs, CO

Contact: Mary Olsen

Sign Up Others Send Feedback Unsubscribe

Industry Affairs Review is produced by the Grocery Manufacturers Association in cooperation with Planet Retail. Current and past issues may be found at www.gmaonline.com/publications/index.cfm. If you wish to add colleagues’ names to the mailing list or if you wish to unsubscribe, please click here, or write to jdowney@gmaonline.org.

@ Copyright 2009 by GMA, 1350 I Street N.W. #300, Washington, D.C. 20005. All rights reserved. The content and copyright for the lead profile is owned by Planet Retail, a leading provider of grocery retail intelligence— www.planetretail.net.

GMA enables its member companies to address the public policy, scientific affairs, product safety and industry issues that impact their ability to create value with and for their customers by advancing their brands and products in a fashion that responsibly improves the quality of consumer lives.

Forward to a colleague

..................................................

GMA IndustryAffairs values your privacy. Information provided by you is used to deliver up-to-date news and other information that you have indicated is valuable to you. We will not share your information with any other person or organization.

To be removed from this list send us a message by clicking here. Be sure to put the word "Unsubscribe" on the subject line. Optionally, you may login and unsubscribe yourself by checking the unsubscribe button located at the bottom of the page.