Auchan: Online expansion continues in Russia

  •   02/07/2021 - 07h39
  •   DEHOUI Lionel

Auchan is a French multinational retailer headquartered in France, specifically in Croix (Lille, France). Its creation dates back to 1961 thanks to the determination of its founder Gérard Mulliez, whose family holds more than 95% of the company. Apart from France, the group is also present on the Chinese and Russian markets. It is also continuing its expansion in Russia.

Auchan: Online expansion continues in Russia

Important expenses in digital to encourage e-commerce

Auchan 's policy in Russia has never been a secret. Auchan entered the Russian market in 2002 under the name AHAH. The company had a total of more than 100 hypermarkets in the country by the end of 2016. For the company, this constitutes the third largest market behind China and France.

Only two years after its presence in Russia, Auchan recorded more than $5 billion in this market (2014). At the time, it was the third largest firm in the sector, behind retail competitors such as Magnit and X5 Retail Group. This time, the group intends to spend more than 20 billion rubles in order to secure some comfort in Russia.

This amount, which is exactly 227.5 million euros, will be used to develop digital services in Russia by 2024. The purpose of this operation is actually to boost the company's online sales in the country.

 

Increase in online sales at Auchan within two years

The company had become the largest company with foreign capital in the country in 2016 according to the Forbes ranking. But the competition has increased over time and the French firm will have to face it. It is indeed present in this market with other distributors and online delivery groups and which are currently very successful. These are mainly Lenta and Magnit.

In general, the period of health crisis has allowed the French retailer Auchan to start with the development of online deliveries. This is quite noticeable in Russia, with online sales accounting for 6% to 10% of the company's turnover in this market. The group intends to do everything possible to develop further and generate 20% of its turnover via digital sales by 2023.

Note: Auchan will now face a new era of transformation. It has no other choice but to continue with its investments in physical commerce without slowing down the digital one. The retailer must also accelerate its digital development.

 

Development of digital and physical services

The 20 billion rubles that the French retail group intends to invest should be used for the benefit of advanced digital services. These include: its technical platform, its data and strategic partnership agreements, without putting aside the investments previously made in Russia.

The Auchan Group did not only focus on this online expansion project. Apart from this decision, it has invested in the modernization of its hypermarkets. It has also resorted to small local shops in order to satisfy the increase in consumption habits. It intends to continue with this growth project for good.