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ROSEMONT, Ill. — It takes time to develop a successful store-brand program, but listening both internally and externally has helped 7-Eleven Inc. develop what is now its largest innovation product pipeline ever — and position itself to launch almost 200 store-brand SKUs in 2015.
Sean Thompson, senior director of private brands for Dallas-based 7-Eleven, was a presenter during the recent Store Brands 2015 Innovation & Marketing Summit, held Feb. 25-27 in Rosemont. Store Brands is a sister publication of Convenience Store News and Convenience Store News for the Single Store Owner.
In terms of internal listening, Thompson explained that when his team began developing its innovation pipeline, he approached 7-Eleven in Japan, which is renowned for its private brand products. He was seeking to understand what private brands mean in Japan, how 7-Eleven develops them and how they are different from the store brands at 7-Eleven outlets in the United States.
He was astonished by how 7-Eleven in Japan constantly invents and rolls out new items, focusing on everything from product quality to the amount of space items take up on the shelf (as real estate in Japan is very expensive).
One particularly unique item he cited is the rice ball. Not commonly found in stores or restaurants, the rice ball traditionally is made at home, typically wrapped in seaweed and containing fish, plum or another filling. It quickly became one of 7-Eleven Japan’s most successful items, selling about 2.4 million rice balls a day across the country.
7-Eleven Japan continues to refine the product. “What’s really crazy is that they will alter this several times a year,” Thompson said, noting the company modifies the packaging to make it easier to open, makes it consumable without having to touch it directly, develops unique fillings, and more.
Learnings From Outside
As for external listening, Thompson — when he was still somewhat new to 7-Eleven and private label — said he began calling U.S. and Canadian retailers across various channels to learn best practices for developing a great team structure, creating and executing a recipe for success, and more.
“They were really willing to share,” he stated.
His team also traveled to various cities across the country to speak with thousands of customers to learn what 7-Eleven does well — and not so well — in the store-brand sector. The team learned that customers have a huge level of trust for 7-Eleven and its private brands. They also learned that store-brand packaging rated well compared to competing brands.
However, store-brand products needed to work harder at “breaking through,” Thompson explained. By listening to what shoppers said, his team discovered that 7-Eleven’s brands needed to be more relevant to women and Millennials.
Responding in two categories of opportunity, 7-Eleven developed the 7-Select Go Smart! brand for better-for-you items and the 7-Select Go Yum! brand for premium, indulgent products.
An interesting example of customer-centric product development is the latter brand’s sea salt caramels: Thompson’s team, understanding that 7-Eleven patrons tend to have a “saltier palate” than others, specified to its manufacturer partner that it wanted the chocolate-covered caramels to be topped with “just a little bit more salt” than usual.
“It’s really, really important for us to understand customer needs, stay close to the customer, figure out how to get the stuff displayed right in stores, how [to] get people in the know, and literally to create packaging that can speak to the quality of the product,” he stressed.