How 7-Eleven's CMO is responding to digital-fuelled customer convenience
- 03 June, 2019 07:04
The proposition for convenience stores is pretty straightforward. But how does that translate in a world where convenience is now more often associated with digital experiences rather than those in the real world?
This is one of the challenges facing Julie Laycock, head of marketing for 7-Eleven Stores in Australia. Her general management role sees her heading a blended marketing and commercial function that includes teams for insights, marketing communication, brand, digital marketing and loyalty.
At 700 stores and growing, 7-Eleven’s value has always been connected to attributes of location and availability. But the rise of home delivery services such as Uber Eats, Deliveroo and Drive Yello is starting to change consumers’ definition of what convenience means to one where the things they want come to them.
The company’s website has traditionally been a lower priority in comparison to its store environment. But in 2016, 7-Eleven took a significant stride into the digital realm with the launch of the its 7-Eleven Fuel App, which uses customer’s current location and real time fuel price data to help motorists to find the best local fuel price at their five closest 7-Eleven stores. They can then ‘lock in’ that price and redeem it at any 7-Eleven Australia fuel store within seven days.
In three years more, than 1.7 million customers have downloaded the app, collectively saving more than $12 million on their fuel purchases.
The functionality of the app has since been extended, so customers also get exclusive product discounts and offers, with more than 1 million offers redeemed. A quarter of these redemptions occurred in January 2019, when 7-Eleven held a month of fuel app freebies with a new product offered every day.
“Fuel App users tend to visit more often, and spend more per visit, including in store, than non-fuel app customers,” Laycock tells CMO.
The company has also trialled digital screens and audio in-store to influence sales by better capturing the attention of customers. Using a store-specific sales prediction model, 7-Eleven was able to ensure it displayed the most relevant marketing content for that store at that time of day.
“The trials proved incremental increase in gross profit dollars, and the solution is now being rolled out across the network,” Laycock says.
Keen to see the company’s innovation activity accelerate further, in November last year Laycock accompanied 7-Eleven’s board and senior managers on a study tour to the US to visit numerous sites that portrayed the potential future for convenience retail. Since then numerous initiatives have emerged, including the creation of a separate digital innovation team focused on new capabilities and ventures.
“We recognised if digital just sat in marketing it wouldn’t realise our ambitions,” Laycock says. “That was a step-changing moment in terms of education and engagement, and that is filtering through the organisation.
“Digital transactions could be up to a third of our transactions in 10 years’ time. That is a really significant goal, and to do that we have to structure ourselves differently.”
Some of the outputs of that group will include new CRM and loyalty systems for the company, while other changes are becoming visible from outside also. This year, 7-Eleven launched its first foray into a click-and-collect service, creating a trial website that offers catering services from seven stores across Melbourne.
“We are very proud of our food products and can provide sandwiches, sushi, cakes, and so on,” Laycock says. “Our catering offer suits businesses, families and social groups who want a simple range of fresh, tasty food at a great value price point and want the convenience of ordering online and collecting at the time and store that suits them.
“The trial is in its infancy, but we’re already learning lots across both the product and the click and collect experience and see great potential for this additional service.”
The new service is a reflection of the broader changes taking place within 7-Eleven, where Laycock says the mantra has evolved from ‘what you want, when you want it’ to ‘what you want, when you want it, where you want it’.
“At the moment we are in-store, but there is no question that to be convenient we need to get to you, and we will use digital channels to communicate with you and sell to you and deliver to you,” Laycock says. “So wherever you want to be, we’ll be there. And as we go forward in the future home delivery is a huge opportunity for us.”
7-Eleven is also experimenting with new models for convenience in the store environment, including a totally cashless store in Richmond.
“There is no counter, so you can’t even use your credit card, you have to use the 7-Eleven mobile checkout app,” Laycock says.
The model allows staff to talk with customers on the shop floor rather than from behind a counter, and they can more easily undertake activities such as restocking shelves.
“Our customers in the store have enthusiastically adopted the technology and are giving us great feedback on their frictionless experience,” Laycock says. “In terms of numbers, things are going well, but as the Richmond store has only just opened to the public, it’s a bit too early to measure. We’re looking forward to seeing how it develops.”