7-Eleven Finds a Niche by Adapting to Indonesian Ways (New York Times)
One of the underlying tenets of marketing states that marketers must fully understand that success will only be realized if an organization provides customers with something they truly want. Understanding this is especially important since most customers are willing to try out new things either because they are naturally curious or because they have been influenced to do so by others. The effect is that customer retention is often extremely challenging as customers want to explore other products.
While on this surface the need for understanding what customers want appears to be a pretty simple concept, in reality it is something that is very difficult to master for several reasons. First, determining what customers want is among the most difficult tasks that face marketers. For some, this is because they lack the research skills needed to find out what customers want. But, more likely, it is difficult because customers are not always good at providing much information since they are often not quite sure what they want until they have it.
Second, just because an organization understands what their customers want does not mean they have the ability to make the changes required to address these needs. For instance, they may lack the managerial talent needed to address a new trend that customers are embracing (e.g., may not know much about a certain evolving technology), or the organization lacks the right experience since the goods and services they are accustom to providing are much different from what customers now want.
However, despite the issues facing organizations as they try to identify and respond to customers’ needs, those that can do this well are likely to reap nice benefits, as seen in this story dealing with convenience store retailer, 7-Eleven. The company’s Indonesian franchise operation has recognized an evolving need for providing a gathering place for Indonesians who are under 30-years old and are heavy users of social media. By identifying the needs of this group, the retailer has adjusted their business model, including offering new products and services. The result is a retail experience that is considerably different compared to what customers in the U.S. and other countries will experience at their local 7-Eleven. The move has worked out well and has helped fuel store expansion at rates that are faster than competitors, such as McDonald’s and Dunkin’ Donuts.
The franchise’s strategy has been to blend a small supermarket with inexpensive ready-made food and seating, which attracts customers in a city desperately lacking outdoor recreation space and snarled by traffic jams that often restrict mobility. “The neighborhood 7-Eleven has become recreational,” said Debnath Guharoy, Asia director for Roy Morgan Research, a market research company based in Australia.
What can 7-Eleven franchise operators in the U.S. and other countries learn from what is happening in the Indonesian market?
Image by Charles Williams