While UK supermarkets battled for e-commerce supremacy for several years, the online grocery market in France remained the domain of E.Leclerc, which has close to 50% share despite capturing only 21% of the total market

A lack of digital investment from Carrefour, Intermarché, and Casino resulted in these groups taking only 17% share of grocery e-commerce, far behind their 47% combined market share. The Digital IQ for French food retailers actually declined by 13% from 2016 to 2017, according to L2’s recent benchmarking analysis for European supermarkets—highlighting how far these companies’ digital investments lagged behind those of other European retailers. 

However, the starting gun has been fired in France and there’s now a mad scramble to catch up.

The race began in November, when Casino Group announced a partnership with UK-based pureplayer Ocado to licence its e-commerce and fulfilment platform. This deal provides Casino with a market-leading site experience far ahead of its French competitors benchmarked in L2’s recent Digital IQ Index: Retail Europe.


Retail enterprise


In January, Carrefour responded by announcing a wide-ranging transformation plan involving a six-fold increase in digital investments, especially around omnichannel and data strategies. Also announced was a partnership with La Poste group to handle last-mile deliveries, a historically weak area for Carrefour, which previously focused on its “Drive” click-and-collect service. This was followed two weeks ago by Carrefour’s acquisition of Quitoque, France’s leading online meal kit startup, which mirrors the business model of the UK’s HelloFresh and Gousto.

Then, on March 26, Monoprix announced it would start selling its products to customers in Paris through Amazon’s Prime Now service, mirroring the partnership that Morrisons in the UK made with Amazon back in 2016.

As with Morrisons, Monoprix’s position of weakness means this was probably their only possible option to scale online sales rapidly. However, the supply chain capabilities that enable supermarkets to import fresh produce from distant countries are the strongest barriers to entry they have to hold back Amazon’s growth in grocery. By providing Amazon with access to its fresh produce, Monoprix may be satisfying its short-term interests in growing e-commerce revenues, but it may destroy its own longer-term prospects by helping Amazon capture the loyalty of French grocery shoppers.

This race is likely to quickly become a battle that’s best watched from afar.

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