Can customer loyalty limit the damage for Carrefour?

May 15, 2024
Bart Muskala
Since the start of the new year, Intermarché took over the Mestdagh stores from Carrefour. The 86 stores bring the total for Intermarché to 163 Belgian stores. With this show of force, the French challenger's market share is soaring at the expense of Carrefour. Retail data company Accurat studied visits to the acquired stores and evaluates the shift in more detail.

On Nov. 10, 2022, it was announced that BMA, the Belgian Competition Authority, agreed to the sale of Mestdagh to Intermarché. The transfer of these 86 branches took place between Dec. 31 and Jan. 4 and has led to a significant change in the competitive landscape in both Brussels and Wallonia.

Intermarché doubles its market position

As a result of its acquisition, Intermarché has a larger presence and therefore suddenly serves a lot more customers. "Logically, you expect a shift in the balance of power between the two players," explains Bart Muskala, CEO of Ghent-based data company Accurat. Through smart technology, they understand the daily shopping behavior of Belgians through a panel of more than 300,000 Belgians. That way, such market shifts are immediately observed. "When we look at visits to acquired stores, we see that this number remains almost stable compared to December. The shift virtually doubles the share of visits to Intermarché, while at the same time the share of Carrefour Market drops sharply."

Change in share of visits since the Mestdagh move

"Customer loyalty is largely location loyalty"

With Intermarché's increased presence, former Carrefour customers suddenly become Intermarché customers. For many, a first introduction to the chain. "Retail is strongly location-driven. We shop near our home or work location and in doing so, a more accessible store is often also a more frequented store." suggests Bart Muskala. "However, the reality is more complex than that."‍

Each chain creates brand loyalty by offering private brands, among other things. A lot of Mestdagh visitors will no longer find their familiar Carrefour products on the Intermarché shelves. A story that Carrefour will play out locally to motivate its customers to get to know another Carrefour nearby or to visit more often from now on. Analyses for the first week confirm that the message is catching on.

‍1 in 4 loyal Carrefour customers who previously visited the chain weekly did not even visit Intermarché at all during the first week. Of this group, half deliberately detoured in search of another Carrefour outlet. The other half of the group preferred another supermarket where they were previously customers.

Curiosity trumps

Along the other side of the coin, a revamped store nearby leads to curiosity every time. For example, each new Intermarché branch attracted visitors who previously ignored the store during its Carrefour period. For example, 1 in 3 of all visitors took another look at the store for the first time in months after the conversion.‍

This group of newcomers compensates for the visits of customers who stayed away because of their brand loyalty. It also immediately explains the stability in the market shift. "Although the first few weeks of a store opening are not necessarily a guarantee of a successful long term," Bart Muskala nuances. Whether new visitors will return, loyal customers will continue to make a detour or Intermarché will be able to seduce them remains to be seen.

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