A few days before Ringo’s husband visited Japan on a business trip, the southern California blogger, desirous of numerous local items but knowing that her husband would have little free time during his visit, placed an order on Amazon Japan. To save on shipping costs, rather than send the items to his Tokyo hotel, she shipped them to a nearby konbini, or convenience store, which has a delivery arrangement with the online seller. “It was very convenient because he didn’t have to shop around for me during his business trip in Japan,” she wrote on her blog. “He was able to save a lot of time there.”
The arrangement was not unique to that particular convenience store; rather, it is a ubiquitous arrangement—Amazon Japan Convenience Store Pickup—for
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Are you adapting your business model to move beyond simply selling merchandise, broadening your offerings to include more holistic notions of convenience? For that, you’ll need to consider an enhanced service-centric model, one that builds on these changing lifestyle dynamics.
Rethinking Convenience
“Forget about what the convenience category used to mean for the past 30 years,” instructs Gunter Pfau, CEO of Stuzo, a provider of personalized and predictive commerce solutions for convenience store and fuel retailers. “Convenience will mean something different in five and certainly 15 years than what it means today.” To succeed, he says, will require “rethinking the category—convenience is what really matters.”
It’s not a one-size-fits-all proposition, either, but reflective of your customer demographic. “Convenience differs by location. It means something different for urban and suburban consumer.
“We’re not taking the constraints of what convenience is; we’re reimagining what it is,” he said. “What we’re saying is to rethink the category: What does convenience mean in the store for a professional living in an urban environment, for
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Margins? What margins?
Laugh at your own peril. Within four years, the service had expanded to include more than 70 Philadelphia delivery drivers alone, while expanding to 20 locations, from large urban centers (Chicago, New York) to more remote towns (Madison, Wisconsin). As a result of its popularity, the company has attracted millions of dollars in venture capital, to boot.
Its durability and growth reflect a strict focus on efficiency, as goPuff doesn’t aim to be a hypermarket on wheels. Its premise is straightforward and uncluttered: Deliver snacks and smokes and alcohol and cigarettes — college kids’ essentials—24 hours of day, within 30 minutes of a mobile order. (Does the product assortment sound familiar?)
“[It’s] Wawa on wheels,” proclaimed the Philadelphia Inquirer, describing the goPuff operation as incorporating a centralized warehouse in each college town where the company has a presence (typically in a low, low, low rent district), one that stocks 3,000 of the most popular items. Uncomplicated, yes. It’s powered by a popular smartphone app, which gives consumers easy access to tap-and-go ordering. And the concept is resonating—strongly—among its
On April 4, 2008 Goldman, Sachs & Co. submitted a prepared prospectus for Dollar General Corporation. According to the prospectus, Dollar General is the largest discount retailer in the United States by number of stores. They serve a broad customer base and majority of products are priced at $10 or less and approximately 30% of products are price at $1 or less. They believe that their combination of value and convenience is what has kept them ahead of their competitors since opening in 1955. Dollar General has had substantial growth in recent years, growing their number of stores from 5,540 as of February 1, 2002 to 8,229 as of February 2, 2007. This growth encouraged Richard Dreiling,
People are often deceived by some famous brands, which they will buy as useless commodities to feel they are distinctive. People require brands to experience the feeling of being special. People spend their money to have something from famous brands, like a bag from Coach or Louis Vuitton which they think they need, yet all that is just people’s wants. Steve McKevitt claims that people give more thought on features or brands when they need to buy a product, “It might even be the case that you do need a phone to carry out your work and a car to get around in, but what brand it is and, to a large extent, what features it has are really just want” (McKevitt, 145), which that means people care about brands more than their needs. Having shoes from Louis Vuitton or shoes that cost $30 it is designed for the same use.
The Frito-Lay product distribution location strategy is to sell in grocery stores, convenience stores and gas stations. Frito-Lay’s distribution strategy is from manufacturer to retailer and from retailer to customer, thus the retailers offer the company a location to sell their products and allows for intensive distribution ("P7distributioncasestudy - Fritolay"). Frito-Lay products are sold in the snacks area. Frito-Lay aims local customers in the countries in which they distribute their packed
A1: Dollar General's main business strategy is to focus on being the leading distributors of consumable basics, with 30% of the merchandise at $1.00 or less. Dollar General believes in maintaining an assortment of consumable merchandise and making shopping for everyday items hassle free and simplistic.
Shopping is a function of location product assortment and store image (Bucklin, 1967) which explain quite well why do people shop where the shop. All of those theories seems to complement each other, adding some more complexity to this highly complex
Based on the Miles and Snow strategy typology, Dollar Tree would be categorized as a prospector and an analyzer. Dollar Tree initially started off as a prospector when it was created as an off-shoot of the retail chain K &K Toys (Parnell, 2014). Prospectors focus on intrapreneurship, which involves the creation of new business ventures within an existing organization (Parnell, 2014). When K & K Toys was divested in 1991, it was done so in order to focus their energies on developing the concept of the dollar store, which in turn gave them the first mover advantage for being first in that particular market (Parnell, 2014). Just as prospector companies places priority on new product and service development to meet the changing needs and
Brand building and quality: TP builds up a distinct identity in the customers’ mind by consistent clothes, mopeds and pizza names. Furthermore TP sells side dishes as well. TP offers promotions and a Kid’s Club. They are centrally producing their dough in Spain and buy the other ingredients from two or three manufacturers in order to ensure consistent quality and taste.
Burger King delivers value to their customers through their products, prices, and place and promotion strategies - (“BK doesn’t just promise value, they actually deliver value”). Burger king has been in existence for 60 years and is growing rapidly in many other countries. Burger King delivers quality, great tasting food which satisfies ones need or wants and captures the value of customers even before the first purchase is made. Burger King has products very unique from other competitors such as KFC and McDonalds. The difference is that Burger King does not limit their customers in terms of what they eat. For example, when I spoke to a customer also big fan of Burger King, he mentioned that the sauces are left public for the customer to decide on which sauce to have rather than giving the customer one kind of sauce such as McDonalds and KFC. The cold beverage is also self-help service in which customers can help themselves to a bottomless drink. This way the customer feels free to choose what satisfies the need or want.
Goss argues that developers and designers of the built environment, specifically shopping centers and malls, use the power of place and understanding the structural layout of the space to boost consumption of the retail profits. Shopping centers are separated from the downtown area of shopping, either by distance and/or design. These establishments emerge for many to be the new heart and location for public and social life. In his article The "Magic of the Mall": An Analysis of Form, Function, and Meaning in the Contemporary Retail Built Environment, Goss also argues that the regulation of the spaces within the mall creates an atmosphere of "community" rather than one that is "public". This article’s main argument is that developers manufacture an illusion of doing more than just shopping when designing malls and shopping centers.
For every $100 spent at a locally owned business, $68 of that will stay local compared to $43 if spent at a “big box store”. Even though people believe that local businesses are not as beneficial as a big box store, buying locally not only benefits the business but also the community because buying locally builds a strong community and the money you spend at a local business gets put back into the community.
For instance, convenience offerings are low-priced goods that consumers can effortlessly acquire because they are relatively ubiquitous while shopping offering requires the consumers’ effort in comparing and contrasting various brands and retail outlet to find the best product at a good price. Besides, while convenience products are needed on a daily basis, shopping goods may not be required on a daily basis and it has a higher price compared to convenience goods. (Tanner & Raymond, 2010). Furthermore, specialty products are different from convenience and shopping offering because it is more expensive from the previous offerings and it is also not commonly sold in retail outlets. The consumers are few and the products are purchased less frequently, which give it a high margin profit. Finally, unsought offerings are different from all because they could be acquired even when it may be unnecessary at the moment. It is a product of circumstance by any
Americans have been so blind-sided by all the shiny gadgets and the commercialization of “necessities” around them that they have confused the idea of what they want with what they need. This need for perfection is a want—a secret desire in disguise. We trick our minds into thinking we need that $50,000 brand...
As was known, FamilyMart is the convenience store that sells all kinds of goods that satisfy all the needs of people's daily life. In this case, the goods that FamilyMart purchases from suppliers wo...
As responsiveness increases, the convenience store chain is exposed to greater uncertainty. A convenience store chain can improve responsiveness to this uncertainty using one of the following strategies, especially for fresh and fast foods:
In order to look out for their customers, Pick n Pay released a customer rewards programme called “Smartshopper”. The programme, launched in March 2011, allows the franchise to get to know and understand each customer better by observing each individual’s shopping habits and references. The company has direct access to many Smartshopper customers via e-mail and/or sms, which allows the business to communicate with their customers in a more engaging manner. Pick n Pay asks for feedback from customers, and sends targeted marketing communications directly to them. All of this is done in an effort to both design and execute marketing campaigns and product ranges which are more relevant to their customers by extracting insights from the customers shopping habits data, as well as to assist the company in growing their sales volumes – which will ultimately lead to an rise in profit (FastMoving, 2012).