AOL France Signs E-Tail Deal with Auchan

[London, ENGLAND] AOL France has
signed a deal, estimated to be worth over US$200 million, with
French retail giant Auchan to develop an online shopping service.

As part of the deal, AOL France will become the exclusive service
offered on computers sold in Auchan’s hypermarkets — and AOL will
have a golden opportunity to publicize its new unmetered Internet
access service.

The new service will be branded “AOL avec Auchan” (AOL with Auchan)
and marketed throughout Auchan’s retails stores. Last year,
Auchan sold around 130,000 PCs in France and says it has increased
sales by 70 percent during the first six-month period of 2000.

Stéphane Treppoz, director general of AOL France, said the
deal brought together two powerful groups to promote Internet
access in France.

“The partnership is modeled on exclusive distribution agreements
between AOL and large retailers in the United States
like Wal-Mart, Target, Sears, and Circuit City,” said Treppoz.

With Auchan, Treppoz said he expected to add another 250,000
subscribers to AOL France.

Auchan’s online store will be accessible at
Auchandirect.fr and
is expected to sell around 4,000 products initially. Deliveries
of groceries, fresh food, etc., will start in the Paris area,
where over a quarter of the French population lives, and will
be extended to other parts of the country over the next two years.

In starting its online service, Auchan is lagging behind
such U.K. ventures as TescoNet,
which has successfully picked up thousands of customers both
for its ISP and its online shopping service. Unlike Auchan,
Tesco developed the service without a major online partner.

However, Claude Palmieri, general manager of Auchan Interactive,
said customers would benefit from AOL’s know-how as well as
from Auchan’s experience in retailing.

Auchan is hoping to achieve online sales of over US $1 billion
within two years of operation.