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Global Marketing Management

Introduction to Carrefour UAE Market Research

The purpose of this report is to analyze the marketing strategy of Carrefour UAE in the current situation of lockdown due to corona. The analysis will begin with a brief overview of the company's history and background along with the identification of organizational issues and challenges. This will be followed by an analysis of the ethical issues faced by the company. The company’s internal and external environment will also be analyzed. The report will end with the analysis of the distribution and promotional strategies the company should use in the current situation.

Carrefour UAE Overview

Carrefour is a leading retailer that was founded in France over 40 years ago (Carrefour UAE). In the last three decades, it has achieved rapid growth by joining several overseas markets such as the United Arab Emirates (UAE). The company joined the UAE in 1995 where it currently operates under a franchise agreement with the Majid Al-Futtaim Group (Carrefour UAE). The company’s mission is to offer an extensive range of low-priced, high-quality products, which include food, personal care, and household goods. In order to achieve this mission, the company operates over 20 outlets in the UAE (Jaelynn 2019). Carrefour is considered to be the most dynamic and fastest-growing retailer in the UAE. The company's success is mainly attributed to its ability to offer excellent customer service and to align its products to market needs.

Issues and Challenges

Due to the lockdown, the company is facing lots of challenges and issues applicable to the NPF business. Some of them are discussed below.

Lack of Resources

Due to the lack of resources in such situation and economic climate had affected the firm the most. The firm needs to connect with similar organizations so that the resources can be utilized effectively and efficiently (Sandybayev 7, 210).

Funding

As per the current situation of the market, funding is the most important thing required for an NPA business in order to serve the community. Due to the lockdown, Carrefour UAE is facing challenges in collecting funds for the benefits of people.

Online Delivery

The business is not able to deliver the requirements of customers to their home because of the lockdown due to COVID-19. As a result, people are also facing various issues and challenges as they are not able to reach places to get lifesaving products and equipment.

Ethical Issues

There are many ethical issues faced by the business as it has to ensure that people are efficiently managed inside the stores and supermarkets without breaking the rules and regulations such as wearing a mask, keeping 3-meter distances, and many more. Some of the ethical issues are as follows.

Increase in Customers

It is required that one person at a time from the family should visit the stores to purchase the required things so that the crowd can be reduced in the stores.

Overbuy

Due to the lockdown, people are buying a large number of products to store them. The authorities are required to inform people that they should buy the required things only so that others can also purchase the same products (Jaelynn 2019).

Last-Minute Shopping

As a result of last-minute shopping, there are chances of getting stuck in the crowd within the store. To avoid such a situation, proper management in the store is required so that people are managed properly.

Internal Environment

This section will discuss the TOWS analysis of Carrefour UAE in which strength, weakness, opportunities, and threats will be discussed.

Strength

  1. Multi-format Strategies: Strategies used to attract the customers are implemented, for example, renovating stores, reaching to every customer and many more (Bernard 2018, 67).
  2. Strong digital platform and customer experience: the organization uses the Omni-channel approach to enrich the relationship with its customers. The group provides various options to the customers such as online purchase, in-store purchase, and home delivery to make shopping easier and efficient for customers.
  3. High-quality product: Carrefour provides high-quality products at the best price possible to ensure the value of customer’s money.

Weakness

  1. Low performance in owns brand product: Carrefour has a wide range of product but it lacks in provided better quality in its product. This weakness can be overcome by focusing on producing a high-quality product with the use of innovative technology (Rajeev and Kevin 2016, 130).
  2. The organization's performance is weak, particularly in the Asian market. Carrefour needs to focus on its promotional strategies to attract customers.

Opportunities

  1. Carrefour can use the internet as a medium to reach its customers as it is the best way to inform the customers about its products and services. Moreover, social media also provide a great opportunity to promote its product and interact with its customers to collect feedback from them
  2. E-commerce: One of the new trends used by almost all the industry to sell its product online. Carrefour can earn large revenue by focusing on building an attractive online platform for business. Moreover, people are largely indulged in online shopping (Kim et al. 2016).
  3. Technology: The use of technology can result in automation, which will help in reducing the cost of operation.
  4. Increase in Population: Increase in population increase the requirement and needs of products, which will be beneficial for Carrefour as it can increase its customers.

Threats

  1. Fluctuating foreign exchange: Due to difficult conditions in the home market and unfavorable exchange rates, Carrefour's profit has been adversely affected in its past years. These fluctuations are due to political uncertainty and change in various economic factors (Muhammad 2016, 95).
  2. Increase in competition: There is a huge competition in this industry generally in both from hypermarkets to that of small stores. Therefore, hypermarkets are focusing on developing new strategies and lowering their prices in order to become better and strong than their competitors.

PESTLE Analysis

Political Factors

Carrefour employs around 380000 peoples and operates in 30 countries around the globe (Bodo 2016, 67). As it is located in various locations, political factors play an important role. Change in leadership may result in a change in policies of wholesale and retail business under which it works. For instance, Carrefour had to close five stores in India as they were undergoing losses due to changes in policies related to Foreign Direct investment. Moreover, the firm should ensure that the country in which it is operating is not subjected to terrorist attacks and military invasion. In addition, stability in the political environment helps the business to operate smoothly and efficiently. Tarde barriers imposed by various countries also affect Carrefour as its capacity for profit-making is hindered (Bodo 2016, 67).

Economic Factors

The growth and stability of the UAE economy are important since it is the home country and is responsible for up to 50% of the sales. The strength of the economy in the country in which it is located plays a crucial role in deciding profit for any particular financial year. The majority of the market is in China and South Asian developing economies. The uncertainty in those market economies makes business volatile. The GDP growth rate reflects the rate at which Carrefour would grow in that economy. The interest rates, taxation policies, etc. govern the growth of Carrefour (Robin 2016, 100).

Social Factors

From the past year, there is a lot of change in people’s lifestyle choices and attitude towards shopping process. Carrefour must target its audience in such a way that all types of customers are covered. Moreover, the demographical population also plays an important role. Carrefour should increase its focus on organic food as most of the people in the current scenario prefer healthy food (West, Douglas, John and Essam 2015).

Technological Factor

Technology has provided various opportunities and chances to Carrefour to enhance its growth and revenue. Carrefour can develop various Omni-channel strategies and can use blockchain in its supply chine management to improve the experience of the customer and its working efficiency. Technology plays an important role in attracting customers towards the product as well as helps in identifying the key factor where the firm lacks by gaining feedback from customers (Tan, Qun and Carlos 2015).

Legal Factors

Law and regulation differ in different countries as Carrefour operates in various countries across the globe. The laws which differ include minimum wages for labor, working conditions, and facilities such as pension schemes, insurance and many more. These laws are very strict in many countries and they also vary when we move towards other countries. For instance, if Carrefour comes with innovation in its strategy or its supermarket, then it should ensure that the idea is protected under the law of intellectual property. It is done to protect the innovation from the competitors (Bernard 2018, 67).

Environmental Factors

Carrefour in itself doesn't generate any waste. But since it is a supermarket store it has varieties of products. It should be ethical in policies to support our depleting environment by not selling any product which harms water bodies by disposing of its waste in them or pollute the air we breathe causing deadly breathing diseases. Organic products are better for humans as well as for the soil in which they are grown. It should try and sell as many as organic products which serve the purpose of customer to maintain good health and save the soil from losing its fertile nature (Zablocki, Agnieszka, Bodo and Elena 2017, 742).

Competitors Analysis

Carrefour has various competitors including Walmart, Tesco, Woolworths, Amazon and many more. As all of the organization has the same profile of the business, all of them experience huge competition. All the above organization is the topmost supermarkets having a large base of customers. They have innovative strategies and plans to approach their customers. To take advantage of the competitive world, Carrefour should improve its promotional strategies by using advertisements to create awareness about the products (Robin 2016, 100). Moreover, Carrefour should provide offers to their customer in order to attract them. In this competitive world, Carrefour needs to undertake aggressive strategies to compete with its competitors so that it can become able to gain more profit despite having large competition in the market. Carrefour can take advantage of its high-quality products by using a blue ocean strategy, according to which selling high-quality product at a low price will increase the number of customers. Further, which will result in the loyalty of customers (Tan, Qun and Carlos 2015).

Improving virtual store shopping experience by enabling customers to make their purchases at their convenience will help Carrefour to reach its customer smoothly. Using several distribution channels has two advantages. First, it enables the company to serve particular market segments. For instance, food service stores cater exclusively to customers who are interested in purchasing food products. Second, the distribution channels improve the company's brand visibility by enabling it to serve as many customers as possible. Since the purchasing culture in the UAE promotes shopping within malls, the company has established most of its stores in large malls in order to increase its sales (Zablocki, Agnieszka, Bodo and Elena 2017, 742).

Conclusion on Carrefour UAE Market Research

Carrefour is one of the most successful retailers in the UAE. The company owes its success to its pricing strategy that focuses on expanding its market share by offering low prices. The company offers a variety of products to satisfy the diverse tastes and preferences of the customers in the UAE. This strategy is supported by the company's ability to use several distribution channels to reach its customers. Moreover, Carrefour can manage its labor cost by a freeze on the hiring of new staff, or shrinking the current staff numbers. Carrefour can use technology to innovate its product and can help customers by delivering the products through drowning. It will be very helpful if we see the current condition of the market due to the corona lockdown. In addition, Carrefour needs to expand its reach by using its local business networks. Carrefour should implement robot technology to deliver its product to its customers, this will help in increasing the brand reputation as well as customer loyalty towards the firm.

References for Carrefour UAE Market Research

Batra, Rajeev, and Kevin Lane Keller. "Integrating marketing communications: New findings, new lessons, and new ideas." Journal of Marketing 80, no. 6 (2016): 122-145.

Begum, Vazeerjan. "Consumers Shopping Predilections With Hypermarkets: An Uae Perspective." http://www.sci-int.com/pdf/636327825749194620.pdf

Jaworski, Bernard J. "Commentary: advancing marketing strategy in the marketing discipline and beyond." Journal of Marketing Management 34, no. 1-2 (2018): 63-70.

Khan, Muhammad Tariq. "The concept of'marketing mix'and its elements (a conceptual review paper)." International journal of information, business and management 6, no. 2 (2014): 95.Kim,

Kim, Kyung Hoon, Byung Joo Jeon, Hong Seob Jung, Wei Lu, and Joseph Jones. "Effective employment brand equity through sustainable competitive advantage, marketing strategy, and corporate image." Journal of Business Research 64, no. 11 (2016): 1207-1211.Lee, K., & Carter, S. (2016). Global marketing management. Strategic Direction, 27(1).

Sandybayev, Almaz. "How Carrefour Revolutionizing Supply Chain Management: Case From The United Arab Emirates." Uluslararası Afro-Avrasya Araştırmaları Dergisi 4, no. 7: 210-220.

Schlegelmilch, Bodo B. "Segmenting targeting and positioning in global markets." In Global marketing strategy, pp. 63-82. Springer, Cham, 2016.

Tan, Qun, and Carlos MP Sousa. "Leveraging marketing capabilities into competitive advantage and export performance." International Marketing Review (2015).

W., Jaelynn. "Carrefour UAE Marketing Strategy." October 1, 2019. https://ivypanda.com/essays/carrefour-uae-marketing-strategy/.

Wensley, Robin. "The basics of marketing strategy." In The marketing book, pp. 75-107. London: Routledge, 2016.

West, Douglas C., John Ford, and Essam Ibrahim. Strategic marketing: creating competitive advantage. Oxford University Press, USA, 2015.

Zablocki, Agnieszka, Bodo Schlegelmilch, and Elena Schant. "Customer-Based Brand Equity in the Digital Age: Development of a Theoretical Framework: An Abstract." In Academy of Marketing Science Annual Conference, pp. 741-742. Springer, Cham, 2017.

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