‘Thanks’ to crisis
The crisis is hitting hard in France: in 2012 the purchasing power of the French declined for the first time in 30 years. The decrease is 0.4% in absolute numbers, but corrected to the demographic evolution it reaches even -1%. E.Leclerc is one of the victors of the crisis, as could be seen earlier this year.
The group recently made low prices its spear point and it sees its market share growing gradually because of it. According to market research agency Kantar, E.Leclerc currently has a market share of 18.8% (on yearly basis up to 24 March). This means market leader Carrefour (all formats combined) is not far off at 20.5%.
“I thought the curves would cross somewhere in 2015”, says chairman Michel-Edouard Leclerc, “now I assume it could happen a year earlier.”
To speed up this takeover of power, CEO Leclerc is counting on the principle of price comparisons. Via a new price comparison site – with the eloquent name QuiEstLeMoinsCher.com (“Who is the least expensive?”) – all customers can compare prices with those of competitors in the neighbourhood. According to E.Leclerc 98% of their shops is cheaper than those of the competition.
It does not stop there: E.Leclerc has also developed an app for smartphones, that allows the customer to scan the code of a product and it will immediately show the price at Leclerc, but also at its competitors in the region. Those people that do not own a smartphone, or don’t have it with them, can use special columns that will be placed at several shops. The whole strategy will also be supported by several ads and commercials.
With this E.Leclerc launches its counter-attack on Carrefour – that early 2012 lowered the price of 500 commonly used products permanently and has been showing comparative ads on television since the arrival of new CEO Plassat – but also on Casino, who launched a campaign about having the lowest prices for no less than 3,000 products.