eBay/PayPal boom in mobile sales

Each month, eBay sells three or four Ferraris... by smartphone. A striking example of the growing importance of mobile shopping. The site expects a 4 billion dollar turnover from mobile purchases – almost 3 billion euro – for this year. 

Huge boom for mobile channels eBay and PayPal

The eBay app generated a mobile turnover of 1.38 billion euro in 2010, 175% more than the year before – with a similar evolution expected for 2011. To achieve this progress again, eBay plans to develop elaborate apps for every existing mobile platform, including – of course – Android and iPad. 


PayPal, a popular online payment system and eBay's daughter company, also counts on a mobile future. With 8% of their 100 million users already using their smartphone to pay, PayPal expects its turnover to boom to 3 billion dollar (2 billion euro) this year. 

"Consumers expect a seamless experience”

Chairman John Donahoe explains the changing retail world the company is adapting to: “Technology-driven innovation is changing how consumers shop and pay. And these changes are blending online and offline into a new global commerce landscape. In this new retail world, consumers expect a seamless experience across multiple channels, whether it's a physical store, a mobile phone, a laptop or any Internet-connected device. In this new world, physical stores will become just another point of access and location alone is no longer a sufficient competitive advantage.”


The most expensive item purchased through the eBay iPhone app was not a Ferrari... but a second hand Mercedes SLR McLaren at $240,000 (€166,500).


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James McCann, ex-Carrefour, new Ahold CCO

Barely two months after his dismissal from Carrefour France, James McCann has been appointed Chief Commercial & Development Officer at Dutch distribution group Ahold. He will take office on 1 September as “acting member” of the board of directors, until his official appointment at the General meeting of stockholders on 17 April 2012.


Bridge between Europe and USA

Ahold boasts about McCann's arrival, saying he has “an impressive background of working in leading roles for a number of international retailers in various countries”. Dick Boer, CEO at Ahold, also praised “his experience in developing businesses in different markets, and his knowledge in e-commerce, building customer relationships and strengthening loyalty. Both will help us accelerate our initiatives in these key growth areas for our business.” McCann's primary task in this newly created office will be to build a bridge between Ahold Europe and Ahold USA.


Positive surprise for analysts

The news is a big surprise, as Ahold never expressed any intention to add a new role to its board of directors. For most analysts, it was a positive surprise that will boost Ahold's stock exchange quotations. ABN Amro's Robert Jan Vos explains: “This appointment is a sign that Ahold is seriously looking to expand itself through acquisitions. The group specifically stated McCann will play an important role in the expansion towards new markets, which indicates that this strategy is a priority measure for them”. 


Impressive resume... with one stain

Briton James McCann, born in 1969, started his career at Shell in 1992, before moving to Mars. In 1999, he moved to Sainsbury’s and three years later already to Tesco, where he was responsible for Poland, Malaysia and Hungary. Last year, he was executive director for Carrefour France until he was let go last May, due to disappointing results: the only stain on an impeccable resume. 



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Carrefour's Brazilian takeover on hold

The Brazilian retail soap about the 'marriage' between Carrefour Brazil and Pão de Açúcar is probably nearing its conclusion, as the Brazilian state withdraws its financial backing for the merger. This is a consequence of Carrefour's arch-rival – and Pão de Açúcar's owner – Casino's decision to officially oppose to the merger.


Controversial merger plans

Carrefour's 10 billion euro takeover plans have always been very controversial, as its rival Casino currently owns a majority of Grupo Pão de Açúcar's shares. Casino had saved the Brazilian company from bankruptcy in 1997 and has invested over two billion euro in GPA. Nevertheless, the merger with Carrefour was supported in Brazil's highest ranks, including the president, who called the merger “a good thing for Brazil” and who promised to invest 1.7 billion euro in the construction through state development bank BNDES.


The notion that a state bank would invest such a large amount of money in the project of one of Brazil's richest citizens (and the nature of that project: selling the biggest Brazilian retailer to foreigners) was highly controversial. Added to these ethical concerns were legal problems: the plan would violate the shareholder agreement between GPA and Casino, resulting in – so far – two requests for arbitration against the former. BNDES also will face prosecution, as an enquiry has been initiated to check whether the merger would have been proper use of public money.


Merger suspended... for now?

When Casino's board of directors unanimously decided to oppose the merger, BNDES announced it was cancelling the deal. Casino is majority shareholder of Pão de Açúcar's owners Wilkes, and this decision caused co-owner Abilio Diniz to suspend the merger plans. But as every soap needs a cliffhanger, he added that he still believes that the merger is very valuable to shareholders and that this decision may well be re-evaluated in the future.


As the shareholder agreement with Casino forces Diniz to relinquish his presidency of Pão de Açúcar next year, many analysts believe that the flirt with Carrefour was the last attempt of Diniz to hold on to his holding. RetailDetail earlier pointed towards another key person for whom this merger is a matter of pride: Pierre Bouchut, general director at Casino until his dismissal in 2005 and now CFO at Carrefour. Both of them however now seem to be aiming for a lost cause.

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Biggest Russian retailer, X5, grows 41%


X5 Retail Group, Russia's largest retail holding, witnessed a 41% increase in sales in the second semester of 2011, owing to an increase in Russian consumer demand and the takeover of food discounter Kopeyka. 


2.8 billion euro sales

X5's sales grew from 79.8 billion ruble to 112 billion (2 to 2.8 billion euro), but CEO Andrei Gusev was not totally satisfied as the growth was slower than in the first quarter – and is expected to be slower still in the third. X5 Retail Group expects the growth to rise again in the fourth quarter of 2011.

Beating Wal-Mart in the chase

Part of the huge growth also comes from the integration of Kopeyka in X5, after the Russians outmanoeuvred American giant Wal-Mart to buy the food discounter for 35 billion ruble (880 million euro). Wal-Mart had been looking for an entry in the Russian market for some time and not acquiring Kopeyka was a setback for the world's number one retailer, who is still expected to enter the Russian market through a merger or a takeover within the next three years. 

Almost 3400 stores

The rapidly growing X5 group was formed in 2006 by a merger of soft discounter Pyaterochka and supermarket chain Perekrestok and was expanded in 2008 with hypermarkets Karusel and again in 2010 with Kopeyka. Currently, the group has 2263 soft Pyaterochka soft discount stores, 647 former Kopeyka stores, 307 Perekrestok supermarkets, 82 convenience stors, 68 Karusel hypermarkets, 19 Paterson supermarkets and 2 Pyaterochka Maxis. The 3388 stores received over 1.2 billion European Russians and Ukranians during 2010.

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Producers underestimate the power of smartphones

Producers keep underestimating the importance of delivering correct product information. In a transparent market, where customers armed with smartphones are becoming ever more powerful, such an attitude equals economic suicide.


Hundreds of millions of armed consumers eager for information

Before the end of this year, over half the population in many EU-countries and the US will have a smartphone, and their numbers will keep growing. Hundreds of millions of consumers use their smartphone to gather information, even at the moment of truth: in the supermarket.


Use of information retrieving apps grew 1600% in 2010

Up to 40 percent of smartphone owners have already downloaded an application to scan barcodes or QR-codes and retrieve product information while shopping. Recent research  shows the use of this applications has risen by 1600 percent (!) last year. These applications are used while the customer is choosing which product to buy in the supermarket – the moment of truth for distributors – so it is of the utmost importance that this information is available and correct. So far, many producers have not understood the importance of this trend.


Only 9% of information complete and correct

In their recent report Beyond the label, ordered by information standardising company GS1, CapGemini discovered that only 9 percent of British groceries displayed correct information to smartphone apps. This means that 91 percent of the 375 products from this sample had either missing or incorrect information – a good reason for the customer not to buy those products. More specifically, 7 percent showed information that was wrong, 9 percent had only partial information available and an enormous 75 percent had no information at all.


Consumers take action against defective information

In this super-fast society, this leads to growing frustrations with customers who want easy access to reliable product information. Over 40 percent of respondents indicated they will not buy a product if there is no information available for smartphones or if this information is not reliable. On the other hand, one in three customers quickly removes applications that display unreliable information.


The complete survey can be found here.


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British department store John Lewis expands web shop to Belgium

British up-market department store chain John Lewis has expanded its internet shop to serving Belgium today. This is just a first step in this country, as the chain has quite some more plans if the introduction proves successful.


Expansion to Belgium now, the rest of the EU next autumn

The British, Irish, French, Danish and Swedes are already familiar with John Lewis, and now the Belgium, the Netherlands, Germany, Greece, Italy, Portugal and Spain can enjoy the chain's services – with the US, Canada, Australia, New-Zealand, Norway and most of the remaining EU countries joining the club next autumn.


No other currencies or languages accepted - for now

This is just a first step for the British retailer, who plans to expand its empire to the rest of the world step by step. While the current web shop is monolithic and monolingual, the plan includes localisation so that each country will have the web site available in its own language(s). Once that step is complete, the chain hopes to open physical stores in continental Europe too.


For the time being however, the website will be uniquely British – it will even not accept payment in euros. “The acceptance of the European currency will be included in the localisation process that also includes the introduction of other languages to our web shop”, said online manager Emma McLaughlin to the Financiële Telegraaf.


From Oxford Street to the rest of the world

John Lewis's first store opened in Oxford Street, London in 1864 and since then, the chain has expanded to 37 British stores and one web shop. After Britain, John Lewis now wants to conquer Europe and the rest of the world. The first step is creating a web presence in these countries: “To make a more significant investment, we need to be confident that the demand is worth it”, commercial director Andrea O'Donnell told the Financial Times in February, when the plan still was to expand to the rest of the EU in one go. realised a £567 million (€635 million) turnover in 2010, 38% more than the year before. This year, the group hopes to cross the £700 million threshold (€784 million) and aims at a foreign share of 1 to 5%.

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Wal-Mart avoids mass discrimination lawsuit

The American Supreme Court has ruled against a “class action lawsuit” in the Wal-Mart discrimination case. Six women had filed a complaint against their employer, complaining that they had less chances of promotion and a lower salary, only because they are women.


No class action lawsuit

The Supreme Court did not acquit Wal-Mart of discrimination, but it decided that it is impossible to judge the working conditions of 1.6 million female employees in once case. It reversed the San Francisco Court of Appeals' decision, saying the plaintiffs have not proven that all these women underwent the same discrimination – which is their legal obligation in order to be able to start a class action lawsuit.


No 11 billion dollar fine

Had the Supreme Court ruled the class action lawsuit valid, the complaint would have applied to 1.6 million women – with the possibility of costing Wal-Mart 11 billion dollars (7.6 billion euro) in case of conviction. As the Supreme Court did not clear the discrimination charges, the case will continue about these six women only. It goes without saying that now the scope has been reduced from 1.6 million to six women, the pressure on Wal-Mart and the height of the possible fines (as well as the media attention in the US) will be significantly smaller.


The National Women's Law Center was very disappointed with the verdict, stating that “the Court has told employers that they can rest easy, knowing that the bigger and more powerful they are, the less likely their employees will be able to join together to secure their rights.”

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