Shanghai Group B Final

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Shanghai residential by Instituto de Empresa, sponsored by PubliEspaña. Students from Master in Marketing Management.
Main differences in the consumer market and the retail sector.

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Shanghai Group B Final

  1. 1. The French are coming… to China Group B Shannon Bengston, Antonio Castro,Jose Corcía, You Lu,Alexandra Martinez,Marcela Martinez,Stephanie von Bassewitz
  2. 2. 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%
  3. 3. When? 1995(Beijing) How? •One stop shop •Low price fresh goods •Self service •Free parking Key Success factor: •Localization •Distribution centers
  4. 4. 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
  5. 5. Location & Store display Carrefour in Shanghai is located close to big It has 35 stores in shopping mall in the city Shanghai centers
  6. 6. Location & Store display Large superficies and Every space is utilized wide isles to display products
  7. 7. Location & Store display Layouts separated by categories
  8. 8. Shanghai’s Carrefour format
  9. 9. Shanghai’s Carrefour format
  10. 10. Product & Price The product offering is localized and The food is really undifferentiated fresh
  11. 11. Product & Price Import products are Additional specialized separated in a more products are in Carrefour’s premium and less visited portfolio area
  12. 12. Consumer Promotions
  13. 13. Service • Self service • Customer oriented • Sale is not aggressive
  14. 14. 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
  15. 15. 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
  16. 16. 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
  17. 17. 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
  18. 18. Store Layout & Displays-Similarities We found the following were standard for the 2 stores: Wooden Glass Different display boxes counters sections
  19. 19. 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
  20. 20. 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
  21. 21. 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”
  22. 22. 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”
  23. 23. 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”
  24. 24. THANK YOU!

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