PARIS: Ecommerce, the growth of "click and collect" and rising popular interest in corporate social responsibility are among the key trends reshaping the French retail sector, McKinsey has argued.
The consultancy stated that French shoppers spend €140bn a year on groceries, matching their total outlay across all other retail segments. It also corresponds with category expenditure levels in Germany, which has 15m more consumers.
However, while grocery revenues have stabilised, they remain largely flat, not least because 89% of adults in France believe the recession is ongoing, versus 74% throughout Europe and 64% globally.
One result has been the increased uptake of online retail, with 38m people now making purchases via this route, which is almost double the figure from five years ago.
Nearly three-quarters of internet users complete transactions in this way at present, measured against 40% in 2006, with the sales generated by the web expanding by roughly 20% per year.
Online already holds 19% of the travel market, McKinsey revealed. By way of comparison, only 2% of food sales come from this medium. The cross-industry average is 6%.
Moreover, mobile spending rose by 171% in the last year to €2.2bn, and nearly half of French shoppers use at least two channels - such as brand websites and in-store - on the path to purchase.
"While French consumers were slower to join the queue of enthusiastic clickers, in just about every category, they are increasingly living in a multichannel world," McKinsey said. "Ecommerce cannot be ignored anymore."
Elsewhere, it reported that the top five grocery chains provide some 75% of sales in France, led by Carrefour with a share of 23.2%.
Despite this, hypermarkets saw their share of DIY sales fall by seven percentage points from 2010-11, an amount standing at 4.8% for small appliances and 2.9% for large appliances.
By contrast, the share of food purchases attributable to "click and collect" – namely, ordering online and picking up items in stores – has quadrupled to 2.3% since 2010, with Leclerc and Auchan two of the chains making progress here.
Other developments include the rise of organic food, which today is worth €4bn a year. A further 43% of shoppers would pay a premium for goods made by firms with strong social credentials.
More than 33% of buyers will also be over 60 years old in 2020, requiring brand owners to adapt. Additionally, smaller stores emphasising convenience are gaining in importance, McKinsey said.
Data sourced from McKinsey; additional content by Warc staff