The French are coming…
to China
Group B
Shannon Bengston, Antonio Castro,Jose Corcía, You Lu,Alexandra
Martinez,Marcela Martinez,Stephanie von Bassewitz

Madrid vs. Shanghai
Madrid Shanghai
• 3.27 M • 18.8 M
• 607 Km2 • 6218 km2
• Average salary • Salary 3300
2000 €/month RMB/month
• Demographics: • Demographics
• M 46% • M 51%
• F 54% • F 49%

When? 1995(Beijing)
How?
•One stop shop
•Low price fresh goods
•Self service
•Free parking
Key Success factor:
•Localization
•Distribution centers

Carrefour
Europe Shanghai
Customers coming from all
directions and meeting in
Carrefour. Family – Happiness – Wealth
French colors. & Security
The environment is very noisy, crowded
and every single space is utilized

Location & Store display
Carrefour in Shanghai is
located close to big It has 35 stores in
shopping mall in the city Shanghai
centers

Location & Store display
Large superficies and Every space is utilized
wide isles to display products

Location & Store display
Layouts separated by categories

Shanghai’s Carrefour format

Shanghai’s Carrefour format

Product & Price
The product offering is
localized and The food is really
undifferentiated fresh

Product & Price
Import products are
Additional specialized separated in a more
products are in Carrefour’s premium and less visited
portfolio area

Consumer Promotions

Service
• Self service
• Customer oriented
• Sale is not aggressive

In the future
Learning's Opportunities
•Focus on facilitating the live of the •Include different product
consumer offering from abroad
Madrid
•Additional services are offered to
improve customer’s experience (delivery
•Location in more premium
& online shopping) places such as shopping malls
•Stores locations in different
neighborhoods are more appealing to
Madrid’s citizens
•Success is based on the deep •In the future, develop new and
Shanghai
knowledge of the local customer more sophisticated service and
•Localization of the product offering selling tools (online sales, home
is the clue to enter to the market delivery)
•Low-price strategy is very important •Improve the physical shopping
to compete in this market environment

We opened the first LV Store 1992in Beijing. It was
attached to aluxury hotel and generated high sales
quickly. Nowadays LV owns 12 stores in China, the
amount of people buying LV is increasing, as well as the
buying power. However we face the problem that LV
bags and shoes are the items most widely copied.
Counterfeiting is a continuous battle but hopeful as
China develops, they will enforce the laws more to
protect the intellectual property rights of all brands. In
spite of this, sales of foreign luxury goods in China are
boomingdespite annual incomes that average just
$1,000 per person.
Bernard
Arnault, Chairman, L
VMH

Location & Ambience Similarities
Lighting: spotlight on products
Music: kept at a low volume; soothing
Louis Vuitton brand promotional video
Display windows block view into store

Differences-Location & Ambience
SHANGHAI
• Small street front store
• Single floor
• Spacious, 2 levels, various
divisions
• Store is part of a luxury
shopping center (2 entrances)
• Store is bigger
• More salespeople and more
security staff
MADRID

Store Layout & Displays-Similarities
We found the following were standard
for the 2 stores:
Wooden Glass Different
display boxes counters sections

Store Layout & Displays- Differences
Shanghai
• Only accessories and purses
on the display window
• Focused on the brand name • 3 window displays: men’s
• Prices on the products clothing, men’s
shoes, women’s accessories
• More classic looks
• Trendier items
Madrid

Product Variety-Differences
Shanghai
• No clothing line available
• Emphasis on women’s
accessories • Casual, formal and swimwear
• Limited variety from each for women and men; with
collection emphasis on women
• Separate area for jewelry
• Multiple sections for shoes and
accessories
Madrid

Emotions Triggered
Shannon’s Experience in Madrid:
“I was walking home from school with my sports clothes and book bag
and I was shocked to find that I felt out of place and intimidated when
I walked into the Louis Vuitton store in Madrid. My broken spanish and
my American “look” made the salesforce less eager to assist me.
Furthermore the store is very small, with only 2 other customers at
that moment, therefore I felt all eyes were on me. Although many
things caught my attention, my first impulse was to try on sunglasses.
Basically I wanted to get out of the store without knocking anything
over, so I would say my experience was intimidating, however I feel
they have done an excellent job at creating an aspirational brand”

Emotions Triggered
Marcela’s Experience:
“ I intentionally dressed up that day to measure the reactions of the sales
people. I started to look around and found the staff friendly and
helpful, although not too aggressive in their sales effort. I asked for
assistance to see some wallets that were in a glass casing and the
salesperson was pleasant and not overwhelming. I spent some more time
in the store but was not motivated enough to make an impulse
purchase, although the service was excellent and the store is enjoyable”

Emotions Triggered
Stephanie’s Experience:
“ I recently visited the Louis Vuitton store in Shanghai. I noticed here in
China, many women in that area were carrying LV bags, giving me the
impression that luxury brands are very important for the Chinese. Once
in the store, I had the feeling that luxury items would be more affordable
and more common, due to the large size of the store, the high traffic and
the fact that everything else here in China is much more affordable for
Europeans. However, I soon realized that the items were even more
expensive than in Europe. Also, I felt more free to look around, without
being observed by the sales staff, although they were friendly and greeted
me pleasantly”

THANK YOU!