February 22, 2010

German shoppers drive, French click & drive

Chronodrive (photo: Les Linéaires)
Chronodrive: Auchan customers can drive to a packing station to collect their online orders (photo: Les Linéaires)
"Chronodrive est magnifique!" This fulsome praise in a recent e-mail from a great-aunt in Belgium was intriguing.

Tante Françine, despite being in her mid-80s, is impressively tech-savvy and orders more on the internet than most young people. She then drives in her automatic car over the border into France to collect her shopping at the Chronodrive packing station.

The click & drive activities of the Auchan subsidiary as well as those of its major local rivals are impressive. French retailers have clearly stolen a march on their German rivals.

We therefore asked Germany's major retailers whether they plan to develop online drive-in systems. Their response, or lack of it, was significant.

Auchan in pole position 

As customers seek to avoid the costs and timing uncertainties of home delivery, most of the French food multiples from Carrefour to Système U are experimenting with a combination of internet shops and customer drive-in collection points.

Auchan is particularly active in this field. "I save a lot of time with Auchan Drive," says the pretty lady in the company advertising. The principle at Auchan Drive is simple: Customers order their shopping online from home and can pick it up only two hours' later at the drive-in of their local store or at a customized packing station.

This obviates having to trudge around a huge hypermarket and stand in long queues at the tills. Auchan promises that staff will pack all orders in your car boot or trunk within five minutes.

French rivals

French retailers have been experimenting with drive-ins for around a decade, but things really began to accelerate at the beginning of last year. Retailer co-operative Leclerc already has 32 "Express Drive" collection points and wants to open another 15 by the end of June.

Rival retailer co-operative Système U has 200 packing stations and wants to double this number without, however, specifying a timeframe.

Major multiple Casino and retailer cooperative Intermarché are currently testing three viz. two drive-ins. Market leader Carrefour has one "Carrefour Ooshop Drive" in the Paris suburb of Villeneuve la Garenne just off autoroute 86.

Metro Group's French Cash & Carry subsidiary has opened four packing stations in the south of France, but these are exclusively for its bulk customers who prefer to save time on collection rather than for end consumers wishing to order online.

Nonetheless, Metro Manager Philippe Bappel says he wants to open 15 drive-ins this year and a total of 55 throughout the country medium-term.

The real enthusiast

The real enthusiast, however, is Auchan. The innovative retail giant already operates Auchan Drive.fr packing stations at 22 of its hypermarket outlets. Auchan is also the principal investor in the start-up operation Chronodrive which runs 16 pack stations on roads exiting major French cities.

Both Auchan and Chronodrive wish to double the number of drive-ins and staff by the end of this year. As from the beginning of 2010, the two divisions have been merged into a holding managed by Philippe de Tavernier, but will continue to operate independently.

At Auchan Drive the process is eminently user-friendly. The internet shopper logs in with his password. Then he uses either a selection of customised shopping lists or a pull-down menu/search tool to select from a total assortment of more than 6,000 lines. Items are then placed in the online shopping basket per mouse click.

As soon as the customer logs in, he is informed about special offers. Auchan Drive emphasises that all online shop prices, including special offers, are "exactly the same" as at the hypermarket.

The customer then indicates the probable time of collection and the store preferred. This information is automatically relayed to Auchan via a cookie.

On arrival at the hypermarket, the drive-ins are usually built on the side of the store away from the main parking lot. The customer drives his car to one of the terminals and enters his customer number.

Within minutes a member of staff arrives pushing a shopping trolley filled with shopping bags which he puts straight into the car boot.

American Drive-thrus
All this must sound pretty antediluvian to our US readers. At Walmart.com over 40 per cent of its online orders are picked-up from the local store. This has encouraged the retail giant to test "drive-thru" pick-up options and redesign stores to include front-of-house pick-up counters.

Sears Holdings is testing a "MyGofer" store outside Chicago, where 80 per cent of the floor space is devoted to backroom storage and the rest to pick-up. Sears Holdings' Kmart subsidiary even encourages competitors to use its outlets as a central pick-up location.

Speculation is also rife that Amazon.com might begin to create pick-up locations.

Currently, UK market-leader Tesco is experimenting with redesigning stores to include pick-up counters, but has no drive-throughs to date.

German retailers in the slow lane
Meanwhile, what are our German retailers up to?

Metro Group referred to their C&C outlets in France and Schlecker to its international internet operations, thus elegantly avoiding any specific reference to drive-ins in Germany. No answer came the stern reply from Rewe Group and Globus.

If we exclude the unlikely possibility that the press offices at Rewe and Globus were deliberately trying to be discourteous by failing to reply, then there are two main possibilities.

Either Germany's major retailers have secret plans to roll out drive-ins in the immediate future and don't want to spill the beans, or they have no intention of offering their customers this additional service.

Surely, the latter alternative is the more likely. German retailing remains so low-margin that there isn't much room for manoeuvre or experiment, even supposing that it was customer-centric in the first place.

Also, German shoppers have never declined a little extra service, but are seldom prepared to pay for it.

On the other hand, the French retailers wouldn't continue to roll-out their drive-ins if there was no money in it.

Significantly, Tesco CFO Laurie McIlwee revealed in a recent interview with our newspaper: "When we began our dot.com business, everyone told us that a central picking facility was the most efficient model. However, when we did our own detailed analysis, we found that all the cost is in the transport. So you need to have your picking locations as close to customers as possible, which benefits both costs and service."

Room for thought, chaps?

Lebensmittel Zeitung with its online sisters (photo: LZ)
Lebensmittel Zeitung with its online sisters
Read in German: 'Franzosen mit Drive' by international editor Mike Dawson & IT desk manager Jörg Rode in 
Lebensmittel Zeitung, no. 7, 19.02.2010

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