7-Eleven Redefines Convenience for the Modern Age
How the convenience retail chain uses data to deliver relevant experiences across the brick-and-mortar and digital realms.
7-Eleven boasts being the largest convenience retail chain in the world, and it has the numbers to prove it. In August, it announced the opening of its 60,000th store worldwide. And last year, it opened one store every two and a half hours.
But the definition of “convenience” has changed since 7-Eleven debuted its first store in 1927. Its original seven to eleven operating hours, which inspired the brand name, no longer cut it for today's busy, on-demand consumers. And customers guzzle down mobile and digital content faster than one of its iconic Slurpees.
Being close to the customer—both in the physical and digital sense—allows 7-Eleven to cater to shoppers' in-the-moment needs, and understanding that those needs differ per person enables its marketers to deliver experiences that are relevant to each customer.
Here's how the brand is redefining convenience across its in-store, social, and mobile retail experiences, as well as a breakdown of the data that powers them. Plus, what kind of innovations is 7-Eleven hoping to deliver in the future to encourage people to say “Oh thank Heaven for 7-Eleven” for years to come?
For Chris Harkness, VP of business development for 7-Eleven, being consumers' convenient neighborhood store means producing what they want, when and where they want it. Having a dense market concentration helps them achieve just that.
“Our location of our stores is a strategic advantage,” Harkness says. “And when we're top of mind and closest to you [and] you have that need, we're going to be in the consideration set.”
Indeed, 7-Eleven has 10,700 stores in North America alone, most of which are open 24 hours a day seven days a week. They're not randomly spread out, either. Harkness says that the company strategically builds its stores in close proximity to create a “dominant presence.”
“We're not just going to have one, or two, or in the tens of stores in the marketplaces where we operate,” he says. “We want to be on as many corners as we can be [so] that we're front of mind with the customer.”
But it's not just the placement of the stores that matters; it's what's inside of them that's important, too.
Harkness knows that different markets have different needs and preferences. For instance, customers in the U.S. and Canada, he says, put more emphasis on fresh fruit and proprietary beverages than other countries. He adds that expanding these North American stores' product assortment beyond traditional convenience store necessities is also becoming a competitive advantage and a priority.
“Our read on the customer is that they're making fewer and fewer trips to the physical retailers,” he says. “And when I actually make the decision to go to your store, if you can fulfill more of my needs than I would actually have thought of—instead of just buying a drink and something to eat—I may be also able to get the laundry detergent that I may have had to go to Walmart [for] later.”
Mapping the customer journey and collecting the data
Considering that the brick-and-mortar locations are the only place 7-Eleven can sell to customers, it should come as no surprise that the brand's marketing strategy is centered on driving foot traffic to the stores.
Working from the outside in, 7-Eleven's VP of Marketing and Brand Innovation Laura Gordon says the customer journey typically starts with advertising, including billboards, subway car and bus shelter creative, and radio and TV spots. Of course, the stores themselves are good traffic drivers, too. Gordon says 7-Eleven usually supplements these initiatives with digital and mobile marketing because it's where customers start their day. For instance, the brand will run ads on weather and sports properties, as well as on traffic and navigation app Waze.
As people get closer to the store, 7-Eleven leverages its storefront, gas pumps, and signage to educate people on the kinds of products and deals it offers.
“We tell them about the price point and the value that we have for them,” Gordon says, “but frankly, we tell them what's new.”
It's not until customers enter the store and near the point of purchase that 7-Eleven begins to inform customers about the quality of the product, Gordon says, like the ingredients. This also presents an opportunity for cross- and up-sells.
“We think a lot about utilizing the store base as a mechanism for conversion,” she says.
This combination of foot traffic, sales, and product assortment offers 7-Eleven a treasure trove of in-store customer data. 7-Eleven feeds this data to its franchisee owners, which allows them to identify trends. For instance, a franchisee owner could see how many pints of ice cream he sold at his store yesterday versus over the past month; then he could align this data with other factors, like weather, to see if there is a correlation, allowing him to better predict whether he should order more or less.
Franchisee owners can also use this assemblage of data to customize their product assortment. So while customers can get Slurpees at any 7-Eleven, the flavors of Slurpee may vary by location. Or, if a store is located along an urban commuter route it might be more likely to sell office supplies than a store located near a school, which could be more inclined to sell toys, Harkness explains.
Slurping up engagement on social
7-Eleven's digital channels are prime points for data acquisition, too, mainly through social listening. The company has a social command center where the staff uses social medial management system Sprinklr to aggregate online consumer conversations and derive insights.
However, it's not just the listening that's important from Gordon's perspective, it's also the responding. 7-Eleven acts upon the social insights that it gathers and adjusts its product assortment, accordingly.
Last year, for example, 7-Eleven learned that the red Sour Patch Kid was one of its customers' favorite flavors among the top-selling candy. So, its marketers approached its Slurpee team and asked them to develop a similar flavor. The Slurpee team created a watermelon flavored Slurpee and then partnered with Sour Patch Kids to create a Sour Patch Kids watermelon candy. The two brands ran a “Sour Patch Slurpee Selfie Challenge” on social media to spread word of the promotion. Gordon says that the brand “absolutely” saw a change in sales after releasing the new flavor.
Social media also serves as a customer service tool and informs 7-Eleven when there's an in-store issue or opportunity at hand. A late-night customer might come in hoping to take advantage of a promotion that only ran from 11:00 a.m. to 7:00 p.m., for instance, signaling that the convenience retailer needed to better communicate the promotion's hours and regulations, Gordon says. Or, the company might see complaints about a store having long lines or not offering a specific Slurpee flavor, she says, revealing ways that specific location can improve.
“It's all about improving the experience,” Gordon says. “Every one of those things is something we feel like if we'd listened better we'd have the right response.”
Like 7-Eleven's other marketing channels, social media also plays a key role in driving traffic to its brick-and-mortar stores. Gordon says the brand has formed partnerships with social media heavy hitters, including Facebook, Snapchat, and Twitter. These partnerships enable the brand to run targeted ads and measure which of these ads actually produced in-store sales.
Finally, social media is used as a vehicle for co-creation and engagement. Last year, for instance, 7-Eleven launched its first Bring Your Own Cup Day promotion in which customers could bring their own vessels into a 7-Eleven store and fill them with Slurpee for $1.49. Although there were regulations around the type of “cups” customers could bring in (they had to be sanitary, no wider than 10 inches in diameter, and fit within an in-store display), some customers wanted to test the boundaries—bringing in everything from umbrellas to inflatable swimming pools.
To help customers recognize whether their cup of choice was eligible, 7-Eleven created a ReallySlurpee Snapchat account. Customers could send 7-Eleven pictures of their vessel and 7-Eleven would snap back a thumbs-up or thumbs-down sign to indicate whether it would work for the promotion.
“Our customers really love it when we start something and they get to finish it,” Gordon says. “That's a big part of our innovation strategy.”
Making moves in mobile
But social isn't the only place consumers can interact with 7-Eleven outside of the store; mobile is a main touchpoint, too and it helps infuse the digital and in-store experiences together.
In 2014, 7-Eleven launched its 7Rewards mobile app—an extension of its reward program that offers customers a free seventh beverage for every six beverages purchased. According to a 2014 press release, 60% of 7-Eleven's customers buy a beverage with each purchase.
But the app does more than just tally customers' drink count. It's also a data goldmine.
Customers can present their app to a sales associate at the time of checkout and have her scan the barcode within the app. This process gives 7-Eleven insight into what customers are buying. If the brand detects that a customer generally buys a certain product or from a certain product category, it can push an offer through the app that the customer might find relevant.
“This is all about bringing value to our heavy users, bringing traffic to our franchisees,” Gordon says, “But, frankly, [it's also about] getting to know our customers more so that we can actually drive them in for more of what they want.”
In addition, 7-Eleven has an in-app voice-of-the-customer program that allows the brand to survey customers on their brand experience. If the brand detects that a rewards member recently visited a store or called 7-Eleven, it can send that customer a push notification inviting them to fill out a brief survey about their experience. Gordon likens the survey to Uber's rating system: Customers rank the experience through a five-point scale and can opt to have 7-Eleven contact them via the channel of their choice. This allows 7-Eleven to better identify which stores are performing well or if common problems are reoccurring.
“What it's allowed us to do is not only be able to understand what the customer is experiencing in each of our stores,” Gordon says, “but it's also helped us be able to more quickly see the opportunity, create a plan to fix it, and then actually solve things for the customer in the store more quickly as a function of that program.”
Finally, the app has a store locator and Slurpee finder (a capability that allows customers to identify which stores carry which Slurpee flavors), which provides 7-Eleven with geographic data.
Dialing back the digital?
Today, customers cannot buy items through the 7-Eleven website; although both Harkness and Gordon say this is something that 7-Eleven is looking into.
“The efforts of the company have been on how do you grows sales in the stores where our capital investment has already been?” he says. “But we believe that there is an opportunity going forward with [ecommerce].”
Gordon says that 7-Eleven tested having an ecommerce site for the 50th birthday celebration of the Slurpee this year.
Expanding its data use cases
There's no denying that 7-Eleven's wealth of data and touchpoints would benefit any retailer, but could its insights serve another community—like America's presidential hopefuls?
For the past five U.S. presidential elections, 7-Eleven has conducted a 7-Election Presidential Coffee Cup Poll. From August 31 to November 8, customers can indicate which political party they're voting for by purchasing their coffee in one of three cups: the blue Democrat cup, the red Republican cup, or the purple nonpartisan “Speak Up” cup. And unlike with the actual election, Americans are encouraged to cast their vote as many times as they want.
In addition to showing their allegiance through their cup color, customers are urged to indicate which issues they're most passionate about by writing them on their cup and sharing them on social media with the hashtag #7Election.
The brand hosted a Free Coffee Week for 7Rewards members in early October to encourage participation. It also ran Dollar Day promotions after each presidential debate in which customers could buy coffee for $1. 7-Eleven will be running the same Dollar Day promotion on November 8. In addition, the promotion has a content marketing element. 7-Eleven partnered with satirical news organization The Onion to produce content, such as “The Onion's State-By-State Election Guide.”
People can view which cup is leading the race daily by visiting the 7-Election campaign website. Not only can they see which cup is leading nationally—which at the time of this writing was the Speak Up cup at 39%, versus 31% for the Democrat cup and 29% for the Republican cup—but people can also view which party is pulling ahead on a state or even neighborhood level.
While the promotion may not be the most accurate poll in this election, 7-Election has acquired more than six million votes over the past five elections, and the results have reflected the actual campaign results each time.
Forecasting the future
So, what's next for the nearly 90-year-old retailer, and how will it continue to generate convenient experiences in the years ahead?
Gordon believes that marketing to moments will become even more important than marketing specific products or to specific demographics. And 7-Eleven is already making some headway on this front.
7-Eleven recognizes the on-demand mindset of today's consumers. So, it's partnered with delivery service Postmates and college courier network Tapingo to bring 7-Eleven's products to its customers.
It also partnered with drone delivery service Flirtey to run its first drone delivery test this summer. The test involved delivering two food packages to a residential customer; however, 7-Eleven intends to expand on this test in the future.
Harkness says 7-Eleven is even in “the thinking phase” of working with autonomous cars.
“We don't have anything necessarily in the works right now,” he says, “but it's on our radar screen as we look at all of the companies making investments there.”
7-Eleven also works with a number of other third-party partners, like KeyCafe to provide a place for those staying at Airbnb rentals to pick up keys; Amazon Locker to store people's packages until they're ready for pickup; and PayNearMe to help cash users pay for everything from childcare to utility bills right within a 7-Eleven store. Some of these partnerships may seem counterintuitive at first: For instance, why would 7-Eleven provide a place for customers to pick up Amazon packages when Amazon sells many of the same products? But these partnerships make 7-Eleven a destination, giving people a reason to visits its store and pick up a snack or related item while they're there.
Despite all of these advances, Harkness says that 7-Eleven still can't overlook the importance of good human-to-human interaction in-store.
“Customers—no matter how digitized we become and how mobile we become—there are still times when we want human interaction,” he notes, “and we [at 7-Eleven] can provide that inside of our stores. Our most successful stores [are the ones where] the associates know the customers. They know how they're going to take their coffee; they know their preference—what kind of bake goods did they want to buy in the morning; and they may even know when their kids are having a birthday. That's a point of differentiation for us and something we're very proud of.”
But in the end, it sounds like it will be the customers, rather than the 7-Eleven executives themselves, who will be setting the course for the convenience brand's future.
As Harkness puts it, “Consumer empowerment is going to drive more and more decisions. The companies that are best able to listen and respond to real sentiment in an authentic manner are going to be the ones that win.”