My Negotiation Club

My key takeaways from IFA Berlin 2025

• The AI is taking over domestic appliances by adjusting energy consumption, analyzing the shelf life of food, suggesting tailored recipes based on your fridge content, helping reduce food waste.
• Samsung goes even further by integrating Google’s LLM Gemini into all devices. Your washing machine will soon be buying your laundry detergent for you and your oven will order Uber eats once it understands that its content is unsuitable for human consumption.
• Smart TVs are now so smart, that they understand how boring Hollywood and Netflix content became, that they allow you to multitask on their TV screens, essentially cannibalizing your phone time. Good! No?
• The new generation of appliances consume less, are brighter, more efficient and quieter than ever before.
• The new robot vacuum cleaners can jump, avoid wires instead of suiciding on them.
• Your dishwasher can now disinfect toys, wallets and phones, just remember to switch the right program and not to wash them instead.
• Micro-LED TVs offer unprecedented customization with incredible quality and contrast. If you can afford one, the size of your TV is probably limited only by your wall dimensions.
• The smart home utopia is coming closer to reality, the devices can talk to each other, share, store and secure information. It is now called the AI home.
• Everything is a screen, everything is entertainment. Watching Netflix on a fridge? No problem. Next move – seamless continuation of experience – music, video, ambient lighting that follow you around the AI home.

And finally, it seems like a new fashion for all domestic appliances is to sponsor sports. It warms my heart to know that PSG football club’s astronomical salaries are paid by my air conditioner.

So, with all the buzz, do I see a light at the end of the tunnel of de-consumption and persistent sales decline? Not yet.

Surely in the next years I will upgrade my fridge and my dishwasher, allowing them to stream Netflix to each other (check the hilarious Murderbot series to feel the depth of the new utopia).

Surely, I will be incredibly happy to have Candy washing machine running 3 drums simultaneously, sparing me the need to load and unload the machine thrice. My left socks will never be mixed with the right ones again!

But for now, bigger, brighter, smarter comes with one hiccup – more expensive…

And neither the Olympic committee, nor PSG, nor Australian curling team can convince me to throw away all the “dumb” TVs and fridges and my 3 suicidal vacuum bots, to step into the AI world of endless entertainment and comfort. The entry barrier is simply too high.

NielsenIQ published the sales dynamics by store size clusters in France. Shoppers are visiting large stores less and less.

The French hypermarket is not dead, as some like to claim. It is adapting to new households, which continue to grow in number (+6% since 2015) but are smaller in size (2.2 people on average today vs. 3.1 in 1960 when the hypermarket model arrived to France from the US). These households drive and consume less, despite having higher incomes.

Some categories, such as cleaning products, benefit from the growth of smaller households, while others, like beauty, suffer significantly as consumption shifts online or to the specialists.

The French version of click & collect, called “Drive” – often attached to the back of the hypermarkets continues to grow, slowly transforming them into the “dark stores”. Logic suggests that shopping centers built around such Drives could benefit by extending the hypermarket’s online offer, but a proven and profitable model has yet to emerge.

French retail transformation is probably unique and quite painful. No other European consumers have been favoring hypermarkets as much as the French. Proof? Carrefour and Auchan exit from Italy, with Carrefour potentially leaving Poland and Romania this year. Tesco leaving Poland, Hungary, Czechia and Slovakia. Real leaving CEE and disappearing in Germany. And finally, even Walmart leaving Germany and offloading the UK.

On the other hand, strong international growth of Couche-Tard (average store 100m2), Jeronimo Martins (average store 700m2) and Mercadona (average store 1300m2) demonstrates the potential of specialised proximity actors.

I keep hearing over and over that the hypermarket is dead.

Not sure Walmart or Costco would agree.

In Europe, the hypermarket model is certainly facing challenges – especially in France, a country that once led the way in adopting the “everything under one roof” format.

Several structural shifts have reshaped the landscape: smaller households, increased urbanization, rising pressure on living (and storage) space, worsening traffic, and the growing number of people choosing not to own a car. All of this has changed how and where people shop – but it’s far from a death sentence. 🙂

Hypermarkets have always been a reflection of evolving consumer preferences. They adapted over time – offering books, video tapes, holiday packages(!), and mobile plans when those were in demand. Later, shifting focus on textiles, electronics, toys, stationery, and home decor as those categories grew in demand. The appeal was always clear: convenience and choice in one pit-stop. So it’s normal that today’s hypermarkets look and feel different. The assortment is more streamlined, the footprint is smaller, but the variety of selection remains unmatched by any other format – even the one with the “infinite shelf”.

In France, hypermarkets continue to lead innovation: building local partnerships, promoting small businesses, collaborating with brands, experimenting with private labels, and acting as key destinations for value-conscious shoppers.

French consumers, in particular, are highly promotional in their behavior. They rely on printed and digital flyers, carefully comparing deals and building their shopping trips around the most attractive offers.

And while both hypermarkets and supermarkets have lost nearly two percentage points of market share to online channels over the last five years, a closer look tells a more nuanced story. Around half of that loss – one percentage point went to “drive” (click-and-collect), which is owned and operated by the same groups that run hypermarkets. E.Leclerc, for example, is one of the leaders in this transformation. In that sense, “drive” represents not a loss, but a rational evolution of the hypermarket model to fit modern consumer lifestyles.

Online retail is undoubtedly growing, both in France and globally thanks to commoditization of electronics and non-essential non-food products. But food, because of its sensory, logistical, and experiential nature will hardly be dethroned from physical stores in the near future. This gives both large and small formats room to thrive, as long as they carefully manage assortment and costs, foster strong local partnerships, and continue to offer extra services that satisfy, pamper, and delight shoppers.

Oh boy!

A CEO who set out to reshape Unilever ends up ousted mid-operation…

Here are my personal reflections on Hein Schumacher’s sprint at the top of UL:

Job cuts: A plan to cut 7,500 jobs, yet sluggish and chaotic execution created confusion, mistrust, and a lack of confidence.

Divestments: The sale of brands and entire divisions led to prolonged uncertainty, internal turbulence, legal challenges, missteps, and lost opportunities.

Unfinished spin-offs: Efforts to offload beauty, tea, and ice cream businesses met mixed success, with the Ekaterra sale already under scrutiny for underperformance—risking a spiral of further job cuts.

Structural changes: A complex vertical split reduced middle management but created a layer of executives with limited influence. An ongoing power struggle between the two offices (an inherited vice?) further complicates steering the ship.

Sustainability shift: Once a pioneer in responsible business, Unilever’s drive and commitment have faded. Drill, baby, drill!

Finally, in pursuit of financial gains, Unilever is losing the confidence of its long-forgotten customers. Inflate and shrinkflate all you want, but the reality is clear – declining market share in key categories is a vote of no confidence in Mr. Schumacher and the board by the ultimate decision-makers: consumers.

In their book “The Big Fix”, Denise Haern and Vass Bednar, among many difficult pain points, touch on emerging issues in e-commerce. It resonates deeply with my professional perspective and the struggles I have personally experienced as a consumer.

“What initially made e-commerce so great – primarily, the ability to quickly search for product comparators across a range of stores and geographies, price compare, and be informed by reviews – has become unnecessarily difficult and disorienting. It’s not just counterfeit products. It’s getting harder to make the best possible choice when you shop because firms of all sizes do sneaky things like preference their own products, make inflated claims through undisclosed influencer marketing, secretly change the shape and size of their products, degrade product quality, or rush you to buy things online through deceptive hurry-up design. Our trust is being manipulated and exploited, and the tactics used by firms to take advantage of consumers are making markets less knowable and more confusing”.

Through selling ad words, tweaking search results by adding “sponsored content,” or guiding shoppers away from their initial search toward the product retailers are incentivized to sell, I ask myself: where does the border lie between providing shoppers with what they want and enforcing on them what brands want them to buy? And to what extent is retail complicit?

When does marketing end and marketeering begin?

hashtag#The_Big_Fix
Image source: https://lnkd.in/eetyaeB2

French retail continued its strong transformation in 2024.

Non-food, petrol, and apparel remain among the biggest “casualties” of post-COVID consumption decline.

Hypermarkets are still the preferred shopping destination, as shoppers continue to hunt for promotions and save on volumes.

The rebound of click-and-collect (which peaked at 12% during COVID) is primarily driven by E.Leclerc’s widely publicized low-price strategy and shoppers’ desire to control “out-of-pocket” spending.

The same logic applies to proximity stores, where lower basket sizes provide a strong incentive to avoid driving to the hypermarket, saving on petrol and impulse purchases.

2025 will be a year of:
– Continued hypermarket share decline, with ongoing decreases in non-food sales driving the need for space optimization. The convergence of hypermarkets and supermarkets now seems inevitable.

– Click-and-collect will continue its growth, as retailers begin implementing AI agents to facilitate recurring purchases, introduce virtual personal shopper, or a chef.

– Uncertainty around failing EDLP concept. Will Lidl’s new management be able to stabilize company’s market share and reach break-even? And will Aldi remain in France at all?

The French FMCG market is slowly recovering from the shock of new legislation. After a 10% drop in both value and volumes during Easter week, the market has rebounded to +1.2% in value but remains negative 1.6% in volume. Why?

Unsurprisingly, the supermarket format is growing as the limit on promotion and maximum margin on farmers goods remove all insentive to drive to a periphery for overstocking. E-commerce is in a fall (-5% versus last year). As mentioned earlier, a few weeks ago, the last pure quick-commerce player have shut their doors in France. What is wrong with E-commerce in France? Wasn’t it the future of retail?

Thanks to new legislation that limits promotions, home and personal care categories are down about 10% in both value and volume.

This is a slightly better performance than the -15% seen last week, but there is still no promise of recovery on the horizon.

On the other hand, the annual inflation rate has slowed down to 2.2%, which is likely linked to the consumption drop. However, the risk of deflation and subsequent recession is obvious if things remain unchanged.

Several retail CEOs and VPs have requested an audience with Emmanuel Macron. Let’s see if that bears any fruit (meat or cheese).