The way for chain convenience store brands to break through: both soft and hard, and seek differentiated development in the homogeneous market.
Author: Zhang Yunqing Editor: Lv Xinyi
出品：零售商业财经 ID：Retail-Finance
When standardization, scale, and digitalization become the regular items in the competition of convenience store brands, it seems that it is difficult to see the "leap forward" innovation story anymore. However, under the question of "whether there is a new way to play in convenience stores", a convenience store is accelerating the landing of the third generation of Pro stores with the concept of "urban third space".
Youjia Convenience Store Pro third-generation stores will open in Wuhan, Nanchang, Shenzhen, and Changsha as early as the beginning of 2024 (2 in Wuhan, 4 in Nanchang, 1 in Changsha, and 1 in South China), and the store type revolves around "convenience store +" intensive cultivation, enters the game with subtle innovation, and leverages new increments, in order to achieve brand rejuvenation.
Although there is no drastic innovation, this is the first card played by Youjia Convenience after the change of the brand's "No. 1 position" (Zhang Lei stepped down as executive director and general manager of Youjia Convenience Store on May 11, 2023).
From the perspective of the industry, the action of upgrading the convenience of Youjia proves that the development trend of the convenience store track is good, and the imagination space is still sexy; Players who continue to deepen their supply chain capabilities, comprehensively deploy real-time retail, and gradually strengthen their membership operations still have the possibility of successfully breaking through.
01 There is a new Pro store type to create a "third space in the city"
With the core concept of "urban third space", Youjia Convenience Pro hopes to create a supply and gas station for young people in the vicinity.
Photo: Retail Business Finance Zhang Yunqing (the same below) Leisure area
The change that highlights the concept of "space" is the addition of a leisure area for consumers to eat, rest and chat. This change reflects that, on the basis of satisfying consumers' "timely" shopping needs, emotional value is the core, increasing leisure space and strengthening service attributes.
"Retail Business Finance" visited Youjia Convenience (Oceanwide 6 Store) in Wuhan Oceanwide International SOHO City, which is mainly aimed at young white-collar workers in nearby office buildings. According to the store manager, the upgrade of the store type is mainly reflected in the store decoration and category expansion.
Specifically, the store uses fresh mint green as the main color, and the youthful color matching with a sense of vitality is no longer dull and more in line with the aesthetics of young people.
From the perspective of product layout, the left side of the store is the cash register and hot food making table, the middle is the standard product shelf, and the right side is the leisure area. Placing the standard product shelf in the middle can not only ensure the privacy of consumers in the rest area, avoid being disturbed by the flow of cashiers, but also maximize the probability of consumers touching and seeing standard products.
Pictured: There is a new convenience store
The hot food making table and the cash register are placed on the same side, and the circulation design meets the efficiency pursuit of nearby white-collar workers to buy breakfast and lunch, without having to go too far into the store, and complete the purchase action with the shortest route.
In addition, the Pro store also released the killer feature of "fresh food", adding freshly made tea and fresh snacks, solving the consumption needs of subdivided periods and scenes such as "five meals a day", and creating an atmosphere of "home for workers".
Pictured: Wuhan hot dry noodles and Jiangxi mixed noodles
In terms of fresh food, Youjia Convenience offers Wuhan hot dry noodles and Jiangxi Nanchang noodles with localized characteristics, as well as traditional fast foods such as Orleans curry chicken steak rice and Korean barbecue bibimbap, as well as a variety of baked desserts and freshly made snacks.
According to the manager of Fanhai No. 6 Store, the daily sales of rice balls in the store are about 20, but the daily sales of hot dry noodles can reach more than 40 servings, which is twice that of rice balls, and Nanchang mixed noodles also have more than 20 daily sales. Compared with traditional fresh food products, this freshly made, regional specialty food is obviously more in line with the dietary preferences of local consumers.
Whether it is the layout of the moving line or the fresh food category, it can be seen that a convenience Pro store regards the needs of the target customer group as the "first principle", constantly taps the potential needs of the crowd, and provides more down-to-earth services.
In terms of the convenience coffee category, the Pro store has also achieved price optimization brought about by technological upgrades.
It is reported that the new store has applied integrated equipment, which has reduced space by 15%, cost by 7.5%, energy consumption by 15%, and operated more conveniently and efficiently.
Figure: Coffee price list
In the previous generation of stores, the average price of the drink Big Blue Coffee was around 20 yuan, while the price of drinks in the Pro store was basically in the single digits. The store manager told Retail Business Finance that this is because of the upgrade of equipment, and the price of drinks has also been reduced.
The price reduction not only saves costs internally, but also gives benefits to consumers, and then establishes a "low price" mentality and further enhances the brand influence.
It is reported that in 2024, the new stores of a convenience store will be mainly new store types, and the old stores will also be gradually upgraded to the Pro version.
Although the new store type is still in the initial expansion stage, its future direction cannot be fully predicted. However, from the perspective of tapping the segmented needs of young people through the Youjia Convenience Pro store type, this move has a greater chance of winning.
02 Change the commander without changing the flag, and create brand characteristics
In fact, the upgrade of the coffee category in the Pro store can be regarded as an advanced version of the "Big Blue Cup" plan.
In 2021, Zhang Lei, then the CEO of Youjia Convenience, launched the "Big Blue Cup" coffee plan, which is benchmarked against Luckin, and the price is about 80% of the latter. In the initial 30 stores, the average daily sales of "Big Blue Cup" have reached 30-50 cups.
The "Big Blue Cup" in the Pro store belongs to the "icing on the cake" business, but the earliest "Big Blue Cup" was born in the crisis moment of home convenience and belongs to the self-help business.
In Zhang Lei's planning, he hopes to enter the office lobby and other points that were difficult for convenience stores to enter through the coffee format, which will help to catch up with the increase in the number of points lost by Youjia Convenience but not community stores.
Looking back on Zhang Lei's career experience, he served as the regional commodity manager of FamilyMart in Guangdong in the early days, and later joined Wuhan Today Convenience Store and was responsible for operation and management; Later, he joined Jiangxi Youjia Convenience as CEO, and at the end of 2017, he led Youjia back to Tpday's base camp - Wuhan.
Under the leadership of Zhang Lei, Youjia quickly entered the expansion stage, and opened nearly 1,000 stores after 4 years. Until September 2021, Xinli Real Estate, a convenient investor, encountered a crisis, and the capital chain suddenly tightened.
Pictured: Baking and rice balls
On the business side, Zhang Lei adjusted his business strategy from "seeking scale" to "seeking quality", and determined the brand positioning of "boutique fresh food convenience store". Zhang Lei's launch of the "Big Blue Cup" coffee plan is to create a "convenience store +" model to seek a new growth curve for convenience stores.
It can be said that Zhang Lei has found a sustainable development path for the brand in the process of leading the convenience of the family to save himself. Today, although Zhang Lei has left Youjia Convenience and assumed the new daily and nightly convenience store, Youjia Convenience is still moving forward in the general direction he has set.
However, convenience store brands make coffee, and it is not unique to have a home.
Also in 2021, Today Convenience Store began to develop its new brand "FU Fu Ca", which integrates multiple concepts such as master special products, light fast food, tipsy bars, and trendy brand clothing. However, less than a year later, the "Today Fuca" on Wuhan Han Street quietly closed its store.
Pictured: There is a new convenience store
The attempt of the same type of business has failed, and if you want to get rid of the same plot, you must come up with a differentiated way of competition.
From the current point of view, this card is "brand rejuvenation".
Youjia Convenience first cooperated with the emoji IP "No Duck" to launch "No Duck! "Duck to Have Home" theme co-branding; Later, it created a Pro store type for young customers in terms of decoration, goods, and services.
Youjia convenience is gradually moving closer to the younger, which happens to step on the new outlet of the industry. According to the "2023 China Convenience Store Development Report", "younger" has become a label for high-frequency consumer groups in convenience stores. According to iiMedia data, convenience store consumers are mainly corporate white-collar workers in first- and second-tier cities, and more than six are women.
With IP operation and "convenience store +" as the starting point, we have found a sustainable model for future development, and Youjia Convenience has gradually found a development path that highlights the brand's characteristics in the exploration.
03 The convenience store market is volatile, and both soft and hard repair is the way to break through
Serious homogenization is a common problem faced by brand convenience stores.
There is not much difference between the major convenience store brands in terms of business scope and product display layout, and it is difficult for consumers to form brand sensitivity and brand loyalty.
Therefore, major brands have begun to roll in, and in the increasingly fierce competition, some players rely on the back-end supply chain to win, while some players have embarked on a "detour".
With 4 industrial parks and 31 logistics and distribution centers, Meiyijia has successfully exceeded 35,000 stores with its strong supply chain strength and topped the list of CCFA China's top 100 convenience stores.
Convenience bees that rely too much on algorithms and can't read consumers are gradually "withering"; Unable to adapt to market changes and unable to innovate and transform, the unified Ginza convenience store failed in local competition and changed hands......
From this scene, it is not difficult to see that the breakthrough of today's chain convenience store brands lies in the hard power of the supply chain and the soft power of the brand, and the establishment of its own differentiated and refined operation of the protective wall.
First of all, the hard power of the supply chain is the basis for enhancing brand competitiveness, and "fresh food" has always been an important part of the differentiated competition of brand chain convenience stores.
Youjia Convenience has set up a product innovation and research center around the five categories of pan-fresh food, and controls and produces through the refined process of its own fresh food factory. At present, the central kitchen of Youjia can produce 100,000 servings per day, which is the hard power support of Youjia convenience in the localization competition. Nowadays, Youjia Convenience is mainly deployed in the market in Central China and South China, and if it wants to enter the national market in the future, Youjia Convenience still needs to continue to cultivate in the supply chain.
Pictured: Fresh food area
In addition to supply chain construction, instant retail and membership system are also internal strengths that convenience store players cannot ignore.
From the perspective of real-time retail layout, online + offline omni-channel operation extends the service radius of convenience stores from 1 km to 5 km, and the online traffic dividend brought by the O2O platform is attracting more and more brand chain convenience stores to deploy online.
Meituan, the top 100 convenience store list, strengthened online marketing during this year's May Day and expanded revenue through live streaming and instant retail, making Meituan a new growth point.
Youjia Convenience has also carried out omni-channel operations: group buying on the Douyin platform, influencer sharing on the Xiaohongshu platform, and full coverage of instant retail platforms such as Meituan, which not only bring more in-store traffic to offline stores, but also better meet the immediate needs of consumers.
From the perspective of the membership system, the future development trend of the retail industry is bound to focus more on customer experience, platform optimization and cross-border innovation. In addition to providing convenient goods and services, convenience store brands should also do a good job in membership operations to increase consumers' "heart share" with more emotional value.
The establishment of a "1 meter wide, 1 kilometer deep" membership marketing system, mining members' consumption preferences, and improving member stickiness is the membership operation concept that Youjia has always pursued. Member-exclusive activities, member mini programs, member points mall, enterprise WeChat account, member welfare community, etc., form Youjia's super member marketing matrix. At present, there are more than 4.2 million members, the repurchase rate of members has reached 70%, and the average monthly consumption of members is more than 4 times.
It can be seen that in the long-term development of brand convenience store chains, supply chain and consumers are still two important dimensions.
After Zhang Lei left, there was still a home. Youjia has been working hard to become a national brand, and it will take time to verify whether Youjia can truly achieve its goal of "having Chinese characteristics" in the future, improve its influence and brand awareness, and lay out the national market.