Eleven Marketing Model
In 1999, the corporation changed its name from the Southland Corporation to 7-Eleven, Inc. In 2006, President and CEO Joseph Depiction decided he wanted to change the focus of the corporation. He used a pyramid analogy to explain that he wanted the customer at the top, the store level employees and managers in the middle, and corporate at the bottom. In doing this, the customer is the main focus, followed by the employees?the people who have the most contact with customers. This “pyramid” enforces the company’s product strategy known as the Retail Initiative.
The Initiative utilizes technology to allow the store operator (whether franchisee or corporate store manager) to make key decisions in the products the store carries. A new product can be put on the shelf and within a day, store operators can see how well customers respond to the product. From there they can decide whether the price point is correct or if the product will even be profitable. Overall, the Retail Initiative gives store operators the opportunity to focus on products on an item by item basis. Slow selling items can removed from the shelves.
This gives a big time lobar brand the focus of a single-store operation. In order to be an industry leader, a company has to be able to adapt to the ever changing needs and wants of the consumers. The company has to be an innovator and can’t get caught playing catch up. “One of the ways 7-Eleven is adjusting is by devoting considerable resources to find out more about our customers. Through extensive research we are learning how people shop, what they expect, what they react to, what gets their attention, and then we gear our marketing and our merchandising toward that, which is very innovative.
This allows us to better serve our customers’ needs so they will come shop in our stores because we have more of what they want. ” (Gill, J. 2013). With the growth of the smart phone market, The Restaurant Social Media Index (RSI), in conjunction with Digitalis’s, released a Restaurant Mobile Consumer Report in 2013. The report outlines the demographic and reach of mobile marketing as well as the overall smartened usage. “According to Morgan Stanley, “The number of smartened users is growing by 42% a year, globally. ” (RSI, 2013). The report goes on to say, “A recent anaphoric states that 81% of U. S. Bile consumers will have a smartened by 2015. (RSI, 2013). The biggest group among these consumers are the Millennial. That is those persons born between 1982 and 1998; which also happens to be the target consumer market of 7-Eleven. 90% of Millennial own a mobile phone and more than half of them own a smartened. To capitalize off this information 7-Eleven created an app that tells customers about special promotions, locates stores, and even provides coupons. To P. O. Boxes, are set up on the store’s premises that allow customers to have what they purchase on Amazon to be sent to their locker as opposed to an address.
The customer can pick their Amazon purchase up on the way home and this will most definitely bring in more foot traffic to the stores. Even with the new technology and all the innovations driven by the changing needs and wants of today’s customers, CEO Joe Depiction is still inspired by the cookhouse’s philosophy back in 1927. Refrigeration slowed down sales of ice and the need for chooses started to diminish. One of the ice dock managers saw the customer’s need for principle everyday items like milk, bread and eggs. As a result, he started to carry those items at his dock.
Other managers took note and started carrying those items as well. The company changed it’s name to Totem Stores and the convenience store was born. “That philosophy of understanding what the customers want and having those products available at their local store is what we still stand for today,” said Depiction. ” (Retail Merchandiser, 2014). That philosophy, while simple, is the reason 7-Eleven has remained on customer’s minds and on top of the convenience store and food industries. The Digital Guest Experience Innovation wise, everything 7-Eleven does stems from a very “customer first” point of view.
Starting with the ice dock manager who first started selling milk, bread, and eggs to customers along with the ice. That initial innovation led to a chain of the very first convenience minded stores and what is today a worldwide family of over 53,000 locations. “It’s a wonderful part of the heritage and it’s important to us because it shows the need for innovation and being part of the innovation team, it is something that we have latched onto and we love the fact that they… Saw an opportunity, started to explore it and that created an entirely new business, and that’s what we’re trying to do at 7-Eleven today. Robert McClain, Sir. Product Manager, CRM and Loyalty, 7- Eleven” (TEST, 2014). So in the spirit of the ice dock manager (affectionately called Uncle Johnny), 7-Eleven put together a team of innovation professionals?led by Mike Debar?to come up with new and exciting innovations focusing on the customer’s store experiences. Debar and the team engaged Carder to help with the strategy and structure of how to best connect with the customers. Carder is a management and technology consulting firm.
They help solve complex business and technology vexations by providing expert, objective advice. 7-Eleven’s innovation team (partnered tit Carder) came up with the Digital Guest Experience initiative. The initiative has 3 main focal points: Customer Relationship Management, A very innovative app, and the voice of the customers. “Through the Digital Guest Experience, Debar and his 7- Eleven team are asking an important question: “How do [customers] help us reinvent our company everyday? ” (Carder, 2015). 7-Eleven has a promise to “be your neighborhood convenience store”.
With that promise in mind, the innovation team partnered with Attracted and Brimley + Partners to create an innovative app that uses a phone’s location services, the customer’s transaction history, and variables such as the temperature to create a unique relationship with each individual customer. They combined Dearest’s Real Time Interaction Manager (RTFM) and B+Up’s “Loyalties”. This created what McClain called “marketing memory’. With the customer’s permission, it allows the app to specialized offers for each individual in real time! For example, you might search for a 7-Eleven location with a Redbook terminal.
The app sees this and offers you a free movie. Even more personable, the app notices when and why you go to 7-Eleven and puts you in different segments. The transactional data that we get in store immediately drives where you are in terms of segmentation, who you are or where? who the system sees you as whether that’s a morning person, afternoon, weekends, weekdays, coffee only so we place you in a segment. That immediately drives the offers or content that you might get via e-mail, push notification within the app, and so that’s immediate and that’s in real time. (TEST, 2014). To take it a step further, the app allows 7-Eleven to see who responds to emails with requests. This is stored data that allows the app to send the customer offers on new or similar items that the customer may have requested. Essentially, the app creates convenience on convenience. Convenience is helping people better navigate through life. That is what McClain and 7-Eleven are striving to do. The Digital Guest Experience initiative allows 7-Eleven to increase retention while providing unique personal shopping experiences.
Local Segmentation On A Global Level As the world’s most well known convenience chain, 7-Eleven strives to cater to multiple needs for very diverse personality types. But even with the millions of sales the brand makes over the course of a day, the one thing that remains a constant is he core customer: Someone who is on the go. With over 53,000 stores in 16 countries (80% of which are franchised), 7-Eleven is largely geographically and choreographically segmented. Geographic segmentation separates customers by nation, country, region, state, city, and even neighborhood.
The company has found that the buying behavior of customers is influenced on where they work and live. As a “globally local” brand, 7-Eleven has to segment geographically because different countries have different cultures, traditions, and lifestyles and their wants and needs reflect their surroundings. The cryptographic segmentation enhances the understanding of the behaviors of the target markets. It divides people based on their attitudes, lifestyles, interests and opinions. “Despite the huge volume of business that 7-Eleven does on a global scale?more than 55 (this is globally, in the U.
S. It is 7 million) million transactions per day?the company has always respected the importance of the individual and particularly the individual’s time. Each store is geared to local tastes and trends, with the goal of providing customers with their neighborhood store experience. ” (McDonald, 2015). Customers spend, on average, only 3-5 minutes on a trip to 7-Eleven. UP of Innovation, Mike Debar had to figure out how they were going to engage with the customer in a way that didn’t seem pushy and would keep the customer coming back in that short span of time.
This was what prompted the creation of the 7-Eleven Digital Guest Experience. As mentioned before, the Digital Guest Experience focuses on three major areas. First, a real time CRM that’s based off the company’s new loyalty program. The second is a serious focus on, what 7-Eleven believes is the platform of program. “This includes interface elements in their mobile app like… “Hubs,” where ideas for improvement are corkscrewed and then voted on by customers. (De Haft, 2015). Voice of the customer is a way for a customer’s preferences, ideas, and experiences to be recorded and shared within the company.
The goal is to better understand customer’s wants and needs and to find out where you deliver on your promise to customers and where the company falls short. “By listening to your customers and acting on their feedback, Voice of the Customer enables you to build better products and deliver better services than you otherwise would have been able to. ” (Medial, 2015). Debar discussed how the Voice of the Customer is a key factor in the company’s investment decisions. Using the feedback from customers, they were able to make a decision to put a heavier focus on their food program; namely, healthy food.
The different cultures in different countries can create an interesting twist on the traditional convenience store. Take Indonesia for example. How does a get in-get out, quick stop convenience store become a trendy hangout spot for millennial? In 2008 when 7-Eleven was poised to enter the Indonesian market, they had to?as with any new geographic location?find out what it was the people of that region wanted. What lifestyle and day-to-day traits could the company instill in the stores that would appeal to the local people?
What they found was that, “People traditionally gather at street markets and share stories, eat in local markets and roadside food stalls called warning or Western fasted chains such as McDonald’s, Dunking Donuts or coffee shops such as Cutbacks which entered Southeast Asia a while ago. ” (Driers, Giuliani, & Huber, 2013). More interesting was that they found the millennial in Indonesia to be well versed in the internet. However, there was a lack of “chill spots”. Places where young people could Just hang out, eat and yes, be online. 7-Eleven in Indonesia included everything local markets and street vendors offered – and more. The store is open 24 hours, has hassle free parking, offers leisure activities such as concerts, is air-conditioned and, most importantly, has wireless connectivity. ” (Driers, et al. , 2013). While other brands struggle to get a different culture or people to adapt to them, 7- Eleven instead adapts to each country’s local market. In Japan, 7-Eleven installed automatic coffee machines and branded itself as a “Caffeinated Powerhouse”.
In Indonesia they’re a hang out spot and trendy coffee shop. In Taiwan, they’re a one top shop where you can pay taxes, bills, and parking tickets. With their Digital Guest Experience, 7-Eleven is turning segmentation into individualizing. Integrated Marketing Communications In a musical composition, there are a set of specific notes written for each individual instrument section. You may have violins, cellos, bass, piano, woodwinds, brass; each with it’s own task. By themselves each section sounds okay at best. Sometimes it may not even make sense by themselves.
But the goal, when you put the instruments together, is to create beautiful music. This is essentially the benefiting of Integrated Marketing Communications (MIMIC). The goal is financial success, as well as customer retention and growth. The instruments in this case, however, are social media, search engines, advertising, promotions, mobile defines MIMIC as “a comprehensive plan that evaluates the strategic roles of a variety of communication disciplines and combines these disciplines to provide clarity, consistency and maximum communication impact. ” (Boundless, 2015).
The American Marketing Association provides a simpler definition, “a planning process designed to assure that all brand contacts received by a customer or prospect for a product, revive, or organization are relevant to that person and consistent over time. ” (AMA, 2015). The primary goal of an MIMIC Strategy is to create a seamless experience for consumers across every aspect of the marketing mix. The brand’s core image and messaging are reinforced as all the promotional tools and marketing communication channels work together in harmony. “Working together” is a basic explanation of integration.
When integration goes past basic communication, there are different levels such as horizontal, vertical, Internal, external and data integration. Horizontal integration occurs across the marketing mix. This means the finance, production and distribution, and communications departments should all be working together to ensure that customers are getting the same message across all platforms. Vertical integration is integration between the store or sales level to mid management to corporate. Everyone should be on the same page as far as corporate objectives and missions.
Internal integration is internal marketing. This means keeping all employees informed about new promotions and advertisements, corporate personalities, and strategy changes. External integration requires working closely tit advertising and Public Relations agencies to deliver a single integrated message. A marketing plan is made up of four key elements known as the 4 Up’s. The promotional mix is one of those Up’s. It contains advertising, public relations, personal selling and sales promotion. “All of these communications tools work better if they work together in harmony rather than in isolation.
Their sum is greater than their parts – providing they speak consistently with one voice all the time, every time. ” (MAC Learning, 2015). 7-Eleven’s Beautiful Music In 2012, 7-Eleven decided to move almost exclusively to an all digital media arresting and promotional strategy. While they still use some of the more traditional promotional tactics such as television commercials and billboards, they’re using their innovative app and social media feedback to create an atmosphere of “relationship marketing”. 7-Eleven’s use of MIMIC is largely customer focused. This ‘Relationship Marketing’ cements a bond of loyalty with customers which can protect them from the inevitable onslaught of competition. The ability to keep a customer for life is a powerful competitive advantage. ” (MAC Learning, 2015). The 7-Eleven app provides real time promotional messages to each individual consumer. Recently, 7-Eleven launched a fresh food campaign. One franchisee explained how the brand, which once relied on tobacco for incremental sales, saw a huge boost in the want for more fresh food as well as an increase in sales. 7-Eleven has been changing its approach to food service for the last several years to emphasize more high-quality fresh and hot food items priced competitively. Part of this plan involves developing a distribution strategy to get more fresh foods into our stores quicker, and this integrated data, they were able to see what the customers wanted and worked with he innovation team to come up with a new distribution plan. To support the new plan of shorter trips for the drivers and more drivers and trucks for that matter, they had to open and acquire more stores.
In 2012 alone the company “added 961 new stores to its roster?over 330 more than it had originally planned. ” (Gill, 2013). 7-Eleven has also been able to come up with some of most successful MIMIC campaigns to date. With projects ranging from blockbuster movie promotions to major wrestling events to even presidential elections, 7-Eleven’s MIMIC campaigns combine what the customers want with what the company wants. This all equals an extreme amount of foot traffic and an increase in word of mouth marketing.
Some of the more successful campaigns include: 7-Eleven Day Every year 7-Eleven celebrates it’s birthday on July 1 lath by giving away free slurped. “Oh thank heaven for Free Slurped Day. It was far more than a promotional stunt. 7- Eleven put on a marketing clinic. ” (Phillips, 2013). People love free things at any point in the year. But for one day during the hot month of July, everyone knows?or can find out easily on any social media site?that you can get the iconic ice cold beverage for free at any 7-Eleven. The concept is simple; You walk in, get a free slurped, you walk out (If you want).
Or, you walk in, get a free slurped, and wait, while you’re in there you might decide you’re hungry. How about a bag of chips or a hotdogs? Maybe just a pack of gum? Maybe you Just want to leave and remind your family and friends that they can get a free slurped today at 7-Eleven. The slurped are free but so is the advertisement and promotion. Slurped Unity Tour In 2010, President Obama made a Joke comparing the state of the US to a car the Republicans got stuck in a ditch. He stated that he’s trying to get the car out and he ants the republicans’ help but they instead stand and watch while sipping on a slurped. -Eleven heard the comment and “drove” with it. They embarked on a multi- city tour to Washington D. C. With the slogan “Washington or Bust”. Along the way they gave out free slurped and allowed people to take pictures with cardboard cutouts of both presidential candidates for the upcoming 2012 presidential election. 7-Election Since the Presidential Election of 2000, 7-Eleven has hosted a coffee cup poll. Customers fill the cup of their choice to “cast a vote”. The red cups featured the Republican candidate and the blue cups the Democratic candidate. Sales information is sent in daily.
While the polling isn’t political or scientific in nature, it has managed to accurately predict the past four elections. The results of the poll can be viewed on the company website and some news and media outlets decide to display the results as well. Very good publicity for the brand name. In 2012 7-Eleven partnered with The Think Tank (TO) to create their mobile app. After the immediate and lasting success of the app, the company named TO as its’ new Digital Agency of Record in January. They will be handling 7-Eleven’s digital ad campaigns in 201 5 and forward.
The first campaign called The rewards Program rolled out at the onset of NCAA March Madness. “[rewards] registered customers with a free drink after they purchase six drinks of any size, hot or cold. ” (Payments, 2015). According to UP of Brand innovation and Marketing, Laura Gordon, 60 percent of customers purchase a beverage on their trip to 7-Eleven. This loyalty program is designed to get existing and new customers to download the mobile app. “To take advantage of the rewards program, consumers have to register as members on the mobile app, which is available for Android and ISO.
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