Carrefour Says Google, Tencent Alliances Starting to Bear Fruit

Carrefour boss Alexandre Bompard on Friday told shareholders that new alliances with tech giants Google and China's Tencent showed the French retailer's e-commerce offensive was making an impact.

Bompard, who took over as CEO in July 2017, said accelerating its digital commerce expansion was an "absolute" priority in the face of competition from Amazon and other online rivals.

"Six months ago we were isolated. All the retail alliances were taking place without us. Now we have deals with Tencent and Google," Bompard told the company's annual shareholders meeting.

"Your company has become attractive again and is resolutely offensive. I am very proud of the Google partnership which shows that Carrefour is back at the highest level worldwide," he said.

Europe's largest retailer in January announced plans to cut costs and jobs, boost e-commerce investment and seek a partnership in China in an effort to lift profit and revenue and beat domestic rivals in the race to develop digital shopping products.

As part of these plans Carrefour announced on Monday it was teaming up with Google to boost its e-commerce on home turf.

Carrefour has been a laggard in e-commerce and the Google deal is in line with Bompard's plans to invest EUR 2.8 billion in digital commerce by 2022, six times its past rate of investment.

It comes after a deal in March between Amazon and the upmarket French chain Monoprix saw the US online giant make further inroads into food retail in France.

Other digital initiatives from Carrefour have included the opening of its first high-tech store in Shanghai last month in partnership with Tencent.

The group also announced a five-year purchasing alliance with peer Systeme-U, that makes Carrefour the biggest buyer in its competitive home market.

In April, Carrefour however gave a cautious outlook for this year after sales growth slowed in the first quarter, with continued weakness in its core French market suggesting that the supermarket chain faces a long road to recovery.

© Thomson Reuters 2018