Written by En-chi Chang.
A place where you can spend the whole day and find newness
Are you craving for a latte, but Starbucks is miles away? Can’t find a snack at midnight because the nearby supermarket and takeaways are closed? Run out of cash but no ATM in town? No problem! Come and have a tour in 7-Eleven Taiwan: https://youtu.be/aI19rxbUVsk.
It is not the 7-Eleven in the US where one could get an urgent supply of milk or eggs or the annex to a petrol station that you see in Europe. A convenience store in Taiwan means a friendly neighbour making your life easier (Always Open, 7-Eleven; 全家就是你家 FamilyMart is your home; Hi-Life is by your side; OK, Good Life!).
A Taiwanese convenience store could be a café, a bistro, a bookstore, a mini bank, a post office, a pop and mom shop, a mini beauty shop, and a telecom shop. Of course, how you name it depends on what kind of services you use inside the store. Except for sleeping, it is a place where you might grab a quick bite, work, chat with friends, or simply do nothing with a cup of coffee!
For Taiwanese, the convenience store is a part of daily routines. From the international airport, highway rest areas, street corners in the city, and tourist attractions on the mountain top, this 24/7 retail format brings convenience and fun to Taiwanese life. For international tourists just arriving on the island, the convenience store should be listed on the survival kit for stocking food or having a break after a long sightseeing tour.
Stores with amenities and offerings for on the go
In 2021, there were 11,985 convenience stores in Taiwan. Most of these stores operated under four brand names: 7-Eleven, FamilyMart, Hi-Life, and OK Mart. The convenience store’s appeal has always been to make Taiwanese life easier and more convenient. Therefore, the evolution and competition of Taiwanese convenience store retailers have revolved around ‘offering convenience.’
The initial appeal was ‘the convenience of location’ by opening more stores. This appeal was encouraged by the economic boom in the 1990s and convenience store retailers’ urge to keep their presence in the market.
Later the focus on convenience was shifted to convenient products and services. The convenience store retailers dedicated their efforts to developing own-brand products and services based on the analysis of EPOS data. Typical own-brand products providing convenience were ready-to-eat meals such as Onigiris (rice balls), sandwiches and microwavable Bentos. Convenient services backed by the well-knitted distribution channels such as package delivery services and kiosks for bill payment and ticket orders also have been on the convenience store’s service list. For example, the four major chains offer store-to-store package delivery services. In addition, 7-Eleven Taiwan’s ibon kiosk in every store provides customers with a convenient channel to pay bills, buy train and concert tickets, and pay for other services inside the store.
Offline and online convenience through service innovation
Now Taiwanese convenience store retailers are seeking to redefine convenience through service digitalisation. AI and data analytics back this new development of product and service innovation. The current service innovation pivoting convenience is the convergence of the international retail trend and the local consumption culture.
Regarding the consumption culture, Taiwanese consumers are known for demanding service choice and good response time with customer service. Therefore, how to go beyond the product and service offerings confined by the limited space and staffing of a physical store and create more services is a challenge for convenience store retailers. The answer to this dilemma is to create more added values related to ‘convenience’ through digitalisation. For example, FamilyMart’s FamiPort app is a FamilyMart’s app store plus the retailer’s port for collecting customer data. The app provides convenient shopping, pre-order services, and similar services inside a physical store and collects rich data for CRM (customer relationship management). This app extends FamilyMart’s services to a virtual store. At the same time, data analytics based on data collected through this app enables FamilyMart to analyse its customers’ profiles, customise its services, and conduct sales forecasts. The analytics is also the initial step of FamilyMart’s development of a smart supply chain.
A related development in service digitalisation linked to the above FamiPort example and echoing the international retail trend is the so-called OMO (Online Merge Offline) and O2O (Online 2 Offline). This service innovation based on digitalisation includes projects already put into practice, such as interactive store shelves showing more information about products a customer picks up from the shelf and IoT-based vending machines. These services enable convenience store retailers to offer more personalised services while collecting data for product development analytics.
Another two examples of advanced service innovation based on digitalisation are 7-Eleven Taiwan’s X-Store, an unmanned store like Amazon Go, and FamilyMart’s O2 Meta, the metaverse in virtual reality. These services are supported by technologies such as AI and big data analytics. While X-Store will enable the convenience store retailer to solve the problem of staffing and collect even more personalised data, O2 Meta further expands the convenience store retailer’s services to virtual reality and possibly beyond the geographical border. In addition, O2 Meta will also enable FamilyMart to expand its services beyond traditional convenience store offerings and entertainment, e.g., gaming, fashion, concerts, and movies.
The convenience store in Taiwan has been part of daily life in Taiwan. To stay competitive, convenience store retailers remain focused on providing customers with convenient offerings. The current trend echoing the international retail development is the digitalisation of products and customer services. Nevertheless, development such as unmanned stores and metaverse is still in the infant stage. It is exciting to observe whether Taiwanese consumers will well receive services such as 7-Eleven’s X-Store and FamilyMart’s O2 Meta and whether other convenience store retailers will follow this development. It is also worth observing whether the convenience store retailer will be able to expand the current service innovation in virtual reality beyond the geographical border and attract international visitors interested in Taiwan.
En-Chi Chang, PhD in Marketing, The University of Edinburgh. Dr Chang currently works as an adviser, market researcher, and content marketer with Allmarketing Digital Marketing & Design Company, Taiwan. Her work encompasses providing advice on the client’s digital marketing strategy, market research, content marketing, and SEO. Before working in the digital marketing industry, she worked for universities in the UK and Taiwan, including the top 100 business schools in the world, and taught different courses in Marketing on-campus and online. In addition, she has been active in research and publication in Consumer Behaviour, Digital Marketing, and Services/Retail Marketing.