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- Subject Code : MKTG5002
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- Subject Name : Marketing
International Marketing for Managers
Contents
Introduction.
History of 7-Eleven.
Expansion of Seven-Eleven stores in France.
Understanding Political Environment.
Understanding the expansion of Seven-eleven in context to Economic Environment.
Understanding social, cultural, and demographic analysis.
Understanding the science and technology.
Competitive environment.
Potential competitors entering in the market.
Understanding the quality.
Seven-eleven competitive advantage.
Innovative strategy.
Introduction to The Impact of Digital Transformation
Introducing the company and its products to other countries can help in increasing the brand reputation as it can also reduce the risk when start working in different countries which in result increase the lifecycle of the business. The culture, religion, law, and the population all should equally be calculated before introducing any product to the company. The retail store industry’s expansion is getting a lot of attention globally. A lot of factors are included such as business strategies, entry threats and planning, opportunities, trust factor and the competition in the market. Strategy plays an important role here as the right strategy will increase the chances of gaining profits and reducing risks. Many of the products of retail store have the items with daily and high demands (Mizuho Research Institute, 2018)
History of 7-Eleven
Seven-eleven was founded in 1927 in Texas, America however the name was adopted in 1946 through a business hour 7 am to 11 pm. The name was given by Masatoshi Ito. The retail empire started by Masatoshi Ito was introduced after World War II. Masatoshi starts the retail business without any corporate support with his mother and his brother in Tokyo. With the hard work and dedication of Masatoshi and his family support he took the business to heights and achieved $3 million for the company. There was a wave of retail stores in the United States and the people were getting the chance of perfect retail shopping (Endo, 2014). Due to the franchise networks formed by the seven-eleven company is touching the heights. Without the franchises, it would be much difficult for the company to achieve this much profit and reputation among the world. Today, there are more than 53000 stores available globally (7-eleven, 2020). These franchise networks are building the economic growth and expansion of the country. To balance the daily working, pieces of training and operations the responsibilities are segmented equally to the headquarters and the franchise stores (David & Forest, 2017). The sales are handled by the store operations and the accounting is managed by the headquarters located in the United States. The company also provides the consulting service, customer satisfaction, complaint resolutions, accounting service and the audit service. Headquarters support the franchise in every way to make it work (Azman, 2018). As the company is still in the process to expand to other countries it is very important to have the complete details of the countries laws and competition to reduce risks.
Expansion of Seven-Eleven Stores in France
Understanding Political Environment
Political environment refers to the political factors within the country. It also refers to the law and the legal systems which can create barriers or can restrict the business due to the country’s political system, rights, guidelines & policies, and the political situation (Zheng, 2018). However, the government of France has encouraged economic development and its conditions and opportunities which can control the marketing. The political environment holds both challenges and opportunities. Economic condition is a threat for many of the companies but seven-eleven economic provide good development in France. Seven-eleven also provides free holidays as a discount and a gift voucher (Bernama, 2018). The opening of the franchise of seven-eleven in France can attract profitable products and services with the expansion of foreign companies. A lot of profits and strength could be achieved. From a political point of view, it can be said that the seven-eleven store will grow undoubtedly. Many of the large retailers could be increased until 2020. A large number of supermarkets can be opened in an urban area should be in everyone’s reach (Rashid, 2018). Many of the large retailers have opened the small retail stores in urban areas in order to expand their business globally. Such strategies and planning have introduced small retail stores around the world which is found to be very convenient for the people (CGSCIMB Research, 2018).
Understanding the Expansion of Seven-Eleven in Context to Economic Environment
This refers to the socio-economic conditions which are responsible for the survival and the development of the seven-eleven retail stores by accepting the economic policies such as the system, structure and urbanization. In France, rubber, palm oil and corn kept cheap in the International Market which increases the purchasing power of consumers which result to reduce economic growth in France (Maybank IB Research, 2018). On the other hand, countries such as China, Japan, the United States, and Europe have a high living cost. Cost of food is always a matter of worry for medium or low-class people as they have to spend a lot of amount on food as a daily expense such as fresh vegetables, fruits and meat. Rise of oil prices also affects the daily living of the people. The economic growth rate of small retail stores is much higher as compared to others which can be calculated as 7%. With increased demand and supply seven-eleven has started their logistics services which are very successful and advanced (Woo, Machida & Kikuchi, 2017). The distribution of goods and services are very successful and easy with logistics management of seven-eleven. With the rise of oil, the cost of goods and services are also increasing. To distribute the goods at the customer doorstep, oil is an additional liability for the company that is why the cost of products and services is increased from its normal cost. Here, retail stores are cheap as people can pick any item in a limited rate from the store which also help them to save money but the rise of petrol will reduce the market revenue (Babin, Borges & James, 2016).
The other plus point is the tourism crowd in France, as tourism in France is very developed. Many people travel to France every year to see the beaches, the royal and ancient places, and especially the Buddha temple. Tourists come and spend a lot of money in the country which is very helpful to increase the economic growth of the country. After the opening of seven-eleven, most of the tourists will also choose to buy from it as they will always prefer to have branded things. Seven-eleven retail stores can promote things which are useful for tourists such as tourist phone cards, maps, travel bags, medicines, and so on. There is less population in urban areas as compared to rural areas but the rural population is weak financially as compared to the urban (Wang, Zhuang & Lin, 2016). People in rural areas mostly prefer unbranded products on cheap costs which are available in small shops which affect retail stores.
Understanding Social, Cultural, and Demographic Analysis
The society, culture, and population always have a high impact on the profit and loss of any business which affects the products and services within the market. Each and every organization whether its large or small faces challenges and threats which are brought by the society and the culture itself. Women are also giving a contribution to society and earning well. Women have entered the workplace and earning money as society is getting modern with continuous development. It is said that a lot of women are working as compared to previous years. Women pay more attention to the brands as compared to men because they are very concerned about their beauty and health. They purchase branded quality products for themselves so that they can look good and smell good (Babin, Borges & James, 2016). This is a strong point for seven-eleven as they can stock the beauty and health products for the females of different brands. Seven-eleven can adjust this opportunity in their stocks and can earn a lot of profits and brand reputation through it. As women are most likely to give reviews and ratings for good products. It can be a great idea to introduce the best women market place. A large number of products can be introduced in seven-eleven.
Mainly single parents and youth are preferred to live alone and are less likely to have children. Due to this people do not purchase a lot of things due to less population. People always prefer to shop near home so that they could take the marketing stuff easily to their homes. Retail stores are the best option for them. The fast-food culture on streets and packed frozen food culture is also increasing with the increasing changes in the society.
Understanding the Science and Technology
Logistics system of seven-eleven can be very beneficial for the company. Consumer needs should be understood completely to provide the result to them. Seven-eleven also focussed on the delivery, purchasing, cash machines, and many other services. Science and technology plays an important role in industrial growth which improve economic growth (7-Eleven, 2020).
Competitive Environment
It is very important to understand the competition part. It is very important to change the strategy as you need to manage your business competition. It is also important to monitor every activity and planning of the competitor. Today, there is a large competition in the world of retail stores. There are a lot of retailers which is very successful in France such as BigC, Tesco, Lotus, and Carrefour’s overseas which are the strong competitors of seven-eleven. There are a large number of convenient stores available in France. The retail stores should adopt the technology and should provide time to upgrade the technology so that it could sustain in the competitive business of retail stores. Seven-eleven logistics system are very famous around the world for its advancement. The buying and purchase trends of the sales system and also spend in power and resources. Seven-eleven used the most advanced network which makes it successful. Technology always plays an important role in the growth of national income and expansion. The gap of technology between the countries also affect their economic expansion. Through the right strategy, the company can stand in the competition as the most significant task of any organization is to survive in the competition. Companies always face rivals within the corporate world, to overcome this competition it is important for the companies to introduce new strategies which could attract the customers towards their store. Companies should rethink about their business model, it is very important to understand that the change is necessary and should be done time to time within a business to make it successful. There are many strategies which can be introduced in as a changing strategy of seven-eleven such as low price, discounts, improved brand, upgraded features, upgraded services, guarantees and warranties, and other digital & social media marketing (Roque, 2020). Whenever a company entered into a mature period the demands are upgraded automatically. Today, customers can get all of the services and goods within the retail market from cosmetics to vegetables. Seven-eleven is considered a medium-size company similar to Lawson, Carrefour, Auchan, and so on. These competitors are very actively working in the market with different strategies in order to come first within all competitors. This is considered as the price war of different strategies. All of the people can have good products and services from seven-eleven. Carrefour, Systeme U, Groupe Casino has established its successful brands in France. Seven-eleven can monitor their strategies and working as it is very important to have a large number of the convenience store so that the people can have easy access to the products and services. There are a lot of stores in France already and it is very tough for any new competitor to enter and to survive in this environment (Cavan, 2016).
Potential Competitors Entering in The Market
Any new competitor in the industry will affect the corporate sector and market share of the companies. The entry of new competitor within the industry is very higher but can also benefit other competitors within the industry (Halzack, 2018). The competitors of the seven-eleven retail store are mostly the multinational stores such as Carrefour, Systeme U, Groupe Casino, and so on. These retail industries are available in large cities. The infrastructure of multinational stores like movie theatres and small banks are much cheaper than seven-eleven stores. These infrastructures occupy some percentage of the market share of the retail industry. Seven-eleven should not focus on selling products but on the convenience that should be provided to the customers for easy shopping (7-Eleven, 2020). Seven-eleven should focus on providing services in residential areas, office place, and near schools and institutions that will also increase their margin of profit.
People living in small places do not have any access to retail stores so they have to shop from small shops. The seven-eleven store can give them easy access to shop quality but low-cost products which they can get easily and do not have to travel much for that and can avail these services. The other benefit is it is open 24 by 7 anyone can purchase things anytime whether its day or night as it will be the nearer and easily available option for them. Customers can buy the goods in less amount (Peacock, 2016). Retail stores are perfectly managed and neatly managed. Many reasonable products can be taken from the retail stores and people can find their desired products. The retail stores have an ability to fulfil all needs of the customer, as they also take request for new products. With this easy shopping, customers will be very attractive towards these retail stores within their range. Many of the stores are also promoting technology and providing ATM stores near or inside their shops so that it will be convenient for them to shop (Zhu, 2019). Retail stores are always clean which make them simple but attractive. The merchandise displayed in the retail stores are very equipped and designable (Pinsker, 2017).
There are many manufacturers and suppliers who want to work with seven-eleven which can easily cover France. However, seven-eleven is very specific about the selection and working pattern of the suppliers. There are a lot of conditions and rules which are set by seven-eleven for the suppliers (Reintarz, Wiegand & Imschloss, 2019). It is very important for seven-eleven to set up the rules and because of the suppliers will not work properly it can also affect the brand reputation of Seven-eleven. Seven-eleven has strict screening for the goods and products which make it more focussed for quality. If the quality fails while screening, the retail store does not promote that specific product which is of low quality.
Understanding the Quality
The quality of the products in retail stores is responsible for the customer traffic within the retail store. The customer’s bargaining power within the store is almost none because the customer only has a choice to either buy the product or to leave it. There is a wide range of products that can be found in seven-eleven. Every consumer has different needs and expectations, it is very important for the service provider to satisfy the customer needs in order to maintain a strong relationship with the customer. Strong and improved relationship with the customer brings can increase customer traffic, customer loyalty, and profitability. Therefore, it is very important to maintain a healthy and strong relationship with the customer. In this competitive world, the main purpose of any business is to achieve customer loyalty in order to achieve a desirable profit. Service quality of the product should be strictly focussed. Quality is the most important strategic component. By giving good quality of product the company can generate more customer loyalty by providing them with the satisfaction of the product. It is very important to focus on the old customer as much as you focus on attracting the new ones. Many of the firms face challenges as they focussed much on new customers and avoid old customers which in result affect the profitability. Associates working in the retail store should be helpful and confident in nature so that they can guide the customer about the products and services and also make them more comfortable to shop.
The quality of the product is based on eight factors which are performance, product feature, conformance, reliability, durability, serviceability, aesthetics, and perceived quality.
Performance of the product- The performance of the product is based upon its opening characteristics on which they operate.
Feature of the product- Feature and additional feature like packaging make the product more attractive and branded.
Conformance of the product- It refers to the design and packaging of the product along with the standards it is based on.
Reliability of the product- It refers to the expiry of the product and the conditions stated.
The durability of the product- Durability refers to the time period of the product or goods until the replacement is preferable.
Serviceability- It refers to the speed of repair.
Aesthetics- It refers to the product overall appeal
Customer perceived quality- It refers to brand reputation and the customer’s perspective about the product and services. By developing customer loyalty companies can earn profitability as good service brings customer loyalty. Customer supports and believes the quality and branded firm.
Seven-Eleven Competitive Advantage
Innovative Strategy
Innovation means introducing new products and services in the business process. It also involves upgraded products. Innovation can be a part of the upgraded products, upgraded mechanisms, organizational structure and business strategy (Emami & Dimov, 2016). The retail industry is very specific in choosing the locations as it is a very important part of a retail business. The right location will bring more profits and will result in a good brand reputation. Seven-eleven is considered as a successful grocer to successful supply chain management. Seven-eleven is now a successful global chain convenience store. The most important thing of seven-eleven is that it continuously changes itself according to the technology and competition which enables them to meet the needs of the customer and to launch new products with digital and social promotion so that the customer can receive the notifications (Royle & Laurg, 2014). Understanding customer choices can also improve the products and services according to the customer’s expectations. Retail stores or the companies must be aware of the changing fashion and dynamics of the market in order to provide the upgraded services for the customers. Customers are always attracted to the designing, packaging and the quality of the product. Seven-eleven only focuses on the selling but also provide the information regarding the product to the customer which is easy for them to make the decision. Customer is only satisfied with complete details of the product, incomplete details can lead to wrong decision-making. This also promotes the communication with the customer which also enhance customer loyalty towards the brand.
It is very important for any company to have a strong and positive attitude to survive in the competitive market. It is very important for retail stores to be aware of the culture and the living habits of the people of the specific region so that they could form a friendly relation with their retail stores. To make it successful it is important to earn customer’s love and trust that will also enhance the quality of the product and services. Good reputation allows the company to survive in the competitive market. Not only managing retail stores but seven-eleven is also involved in charity programs and help the society to become stronger. The seven-eleven support team also helps people in the time of difficulties as a charity part. It works for the safety of women and children and protects them from any type of violence (Wilson, 2016). These charity programs have helped seven-eleven to maintain the brand reputation and also make it unique from others. Countries operating with seven-eleven have a large number of stores that can be seen almost everywhere. The stores are available all around the street, corners, and the region which makes it easy to reach. Providing ATM services with the store is very beneficial for the customers (Zhu, 2019).
Conclusion on The Impact of Digital Transformation
Retail stores are the most convenient shopping place for people. Here, people can buy anything easily anytime they want. Seven-eleven is operating in 17 countries and in the process to expand itself globally. For this seven-eleven chooses France wherein seven-eleven stores can be opened in various locations. As the tourist came to France every year in large numbers they always look for branded and quality products and here seven-eleven can be beneficial for them. However, there are many other retail stores which will be the competitors for seven-eleven. Seven-eleven can become unique and the chosen retail store for the customers if they provide unique services at cheap cost to the people as they are doing in all 17 countries.
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