As grocers battle for share of the lucrative and growing convenience market, we take a look at some of the best innovations in c-stores globally.
Auchan Minute’s unstaffed convenience
Unstaffed, checkout-free stores have been a hot topic in 2017, and Auchan Minute is an example that promises to move beyond the conceptual stage – and on a potentially massive scale.
Developed by Auchan China in partnership with Hisense, the stores are essentially 18 sq m boxes (roughly the dimensions of a shipping container).
They carry about 500 SKUs with basic grocery, beers, wines and spirits and a few fresh products, targeting impulse or convenience shoppers.
Payment is by smartphone, chiefly using the WeChat and Alipay mobile payment systems. Once inside, shoppers scan purchases themselves, then pay using the app.
In contrast to, for instance, Amazon Go, Minute stores use relatively simple and cheap technology. Replenishment is simple, too – one Auchan hypermarket can restock several Minute locations around the clock. That makes the model highly scalable.
Auchan plans to open “several hundred” Minute stores across China by the end of 2017 and will bring a European version to the Continent by 2019, so expect to see these super-small box stores everywhere by the next decade.
Petit Lawson reaches shoppers at work
Japan is the heartland of convenience stores and leading operators leave little to chance in ensuring they can reach shoppers, wherever they are.
With vast swathes of the Japanese population working long hours, c-store giant Lawson has found a way to reach those office-bound consumers. Meet Petit Lawson.
This freestanding unit is fitted with shelves holding about 50 snack items, topped off by a self-service checkout terminal.
The range caters to every need a famished Tokyo business person might yearn for – from food to confectionery. The intention is to have 1,000 Petit Lawson stands across Japan’s capital by early 2018.
Lawson is not the only retailer targeting the “ultra-convenience” trend. Rival FamilyMart UNY offers a vending machine unit that can handle food requiring storage at varying temperatures (such as rice balls, salad or bread).
Suntory Beverage & Food takes its vending model a stage further. Its drinks machine can be linked via an app to a customer’s smartphone. The app records walking distances and rewards the user with discounts on healthy beverages purchased from the machine.
F5 Future Store’s auto-replenishment
F5 Future Store is an unstaffed convenience venture in Guangzhou, Southern China.
The first automated store under the F5 banner comprises 35 sq m of selling space, two counters for food and goods, a beverage-maker and a self-cleaning dining table.
Shoppers can order and pay for products either at a dedicated terminal or using their phones. The store’s unique feature, however, are robotic arms that retrieve goods and clean tables. By automating replenishment, F5 has eliminated the need for human shop assistants entirely.
There are at present six outlets, with ambitious expansion plans. Having won funding from Sinovation Ventures – which is run by former Google China boss Kai-Fu Lee – 30 to 50 store openings are envisaged in up to six months.
F5 Future Store previously raised CNY 10m (£1.1m) from Chinese electronics firm TCL’s venture capital unit and an additional CNY 2m (£224,000) from Chinese incubator InnoHub.
With a lot of interest from a number of retailers, unstaffed shops may well be part of the future of physical retail.
Tao Café integrates online and offline
Alibaba staked a claim in physical retail this year with various initiatives, including 10,000 planned Tmall franchise convenience stores, ‘smart’ automated petrol stations and a shopping mall project.
Among them, the Tao Café project stands out as one of the more experimental ventures – more proving ground than growth lever.
The 200 sq m café offers beverages, snacks and fast food and can accommodate up to 50 customers at a time. It is checkoutless and operates using shoppers’ smartphones and Alibaba’s app.
Entry is through ticket gates and customers are required to scan their smartphones to walk in. The store’s e-shopping system was developed by Alibaba subsidiary Ant Finance, which assigned shop assistants to help familiarise shoppers with how it works.
This highlights a key feature of the unstaffed convenience race – the need for intuitive, user-friendly, customer-facing tech.
Tao Café has served as a valuable testing site for a number of smart technologies, as well as a source of shopper data and browsing patterns for Alibaba.
Carrefour Urban Life’s ‘social hub’
Carrefour Urban Life, launched in Milan in early 2017, represents the ultimate in in-store services.
It features an area to lounge and relax, eat and drink, free Wi-Fi, charging stations for mobile devices, meeting rooms and co-working spaces.
The store is one of the latest examples of retailers seeking to improve the experiential aspect of stores and increase dwell time by introducing services.
Carrefour has redesigned the supermarket to include new areas such as a café, gourmet deli and Tokyo Street area where the sushi is prepared fresh daily.
It is not difficult to see why Carrefour has moved in this direction. As discounters and ecommerce continue to grow in popularity, high street operators need to find new incentives for shoppers to visit a store.
Carrefour is one of several retailers which have sought to turn the store into a social meeting point by introducing services, social spaces and accommodating connected shoppers.
A complete network revamp is, however, an expensive investment.
While Carrefour is unlikely to fully convert many locations to the Urban Life format, this first store will likely serve as a test, with successful elements rolled out to other branches.
Lawson addresses an ageing population
Lawson in Japan has opened service bases for the elderly at nine shops. Those Lawson stores sell a variety of nursing care goods and have consultation counters for people taking care of elderly family members.
There is also space where elderly customers can drop by and interact with each other. The retailer also offers private-label products with ‘chewability’ ratings on the packaging (rated from one to five).
Highly targeted offers such as this will become ever more important in the future, as shopper segmentation increases and consumer profiles become increasingly diverse.
Most developed countries are forecast to reach the ageing population threshold (more than 20% of the population aged 65 and over) by 2020, so addressing elderly customers will be one way of securing a loyal shopper base in the coming years.
7-Eleven and FamilyMart’s nurseries
A big concern facing convenience operators seeking to expand in Japan is an ongoing labour shortage. 7-Eleven and FamilyMart are solving the problem by introducing in-store nurseries for employees.
In October, 7-Eleven Japan opened two nursery schools – one in Tokyo and the other in Hiroshima Prefecture. Both areas have long waiting lists for childcare facilities.
In this way it intends to solve two issues at once, addressing both the labour shortage, the limited number of women in the workforce and limited childcare availability.
Fees for the service are subsidised and the facility is available to local residents as well as 7-Eleven staff.
FamilyMart unveiled a similar initiative last year, following its merger with Uny. FamilyMart intends to double the number of former housewives working at the chain to 100,000.