E-mail Article
Print Article
7-Eleven, Inc. launches a new line of private-label products this month under the brand, 7-Select®. With the rollout of the 32 new items, 7-Eleven strengthens its presence in store-brand packaged foods, a business that has increased dramatically over the last year and promises strong future growth, especially in light of consumer budget-tightening during the decelerating U.S. economy.
New items include cookies, candy, nuts, potato chips, beef jerky, trail mix, plus chocolate-covered pretzels, coffee espresso beans, raisins and peanuts. Suggested retail prices offer a significant savings from 10 to 20 percent for customers versus the national brand equivalent.
More shoppers are reaching for house brand products in this uncertain economy. According to a new survey by The Nielsen Co., nearly three out of four American consumers believe store brands are good alternatives to national brands, and more than 60 percent consider them to be just as good.
In May, 7-Eleven began a pilot program to offer the new private-label products, like snacks, candy, nuts and cookies, in 1,500 stores in Florida and the Mid-Atlantic area. With in-store displays and point-of-purchase signs to communicate the benefits of the new snack line, 7-Eleven customers showed immediate interest in the new value-priced items.
Sales have continued to climb steadily, and many items are already outselling the name brand. Of the original 31 items first tested, 26 were selected for the initial launch along with several new candy additions.
Editor’s Insight: The vending industry has long recognized that name brand products sell best, and it would be premature to assume that vending operators should change their selling strategy. The current economic climate has driven consumers to focus more on price, but this does not mean customers don’t also want value for their money.
7-Eleven has been able to succeed with its private label strategy because it has developed high quality private label products and it has been able to educate consumers about product quality at the point of sale.
In a retail store setting, consumers can examine products closely before purchasing them, which is not the case in a vending machine.
The major takeaway for vending operators here is that consumers are shopping harder for value. 11-26-08 by Elliot Maras