When searching for a topic to write about this week I decided to check out Apple’s app store to see if there were any new apps climbing the rankings. The rankings were pretty much what I would expect until I came across 7-Eleven’s app ranked at number 17 in the Free App section.
Not only was 7-Eleven’s app ranked seventeenth but it was ranked above Amazon’s app, the largest internet based retailer in the world. More importantly, after scrolling down further I found Starbucks ranked number sixty six and even worse, Dunkin Donuts at number 141. To me these rankings seem counterintuitive. What is 7-Eleven doing that other companies aren’t?
7-Eleven Basic Facts
7-Eleven is the leading international chain of convenience stores with over 56,000 stores all over the world. There are close to 11,000 stores in the US and Canada alone. They are leaders in innovation, having been the first to do things that seem obvious to us today. They were the first store to operate 24 hours a day, sell fresh-brewed coffee in to-go cups, have a self-serve soda fountain, and offer super-size fountain drinks. They were even the first convenience store to have an ATM.
They are most well-known for their slurpees and large sodas but coffee is also a major seller. In fact, of all its products, 7‑Eleven sells more coffee than anything else at 1.1 million cups each day.
Function of the App
The app is incredibly simple with minimal features. Your barcode to scan at purchase is the first thing you see. There are banners at the bottom telling you about the current promotions. In the hamburger menu you can see possible savings & coupons, give feedback, and find nearby locations.
Their New Marketing Campaign
Many people flock to 7-Eleven on July 11th for their free slurpees. It’s usually a highly publicized event. But now they have extended their free drinks to last throughout the year. 7-Eleven has created an incentive rewards program unlike any other food or beverage company. If you buy six drinks at 7-Eleven and scan your app while purchasing, you will receive your seventh drink for free no matter the drink or the size. This isn’t even a temporary marketing.
Let’s put that into perspective. As I mentioned before, coffee is 7-Eleven’s biggest seller. Most people get coffee on a daily basis. If you got coffee everyday Monday through Saturday at 7-Eleven, every Sunday you could get a free drink of your choice.
Starbucks and Dunkin Donuts, two major coffee providers in the United States, also have rewards programs. To earn a free item using Starbucks Rewards you would have to earn 125 points which is the equivalent of spending $62.50. If the average Starbucks drink you bought costs $4 you would have to buy around 16 drinks to receive a reward. Dunkin Donut’s DDPerks program is a little better. You receive a free drink for every 200 points you earn, the equivalent of spending $40. The average drink at Dunkin costs $2, meaning you would have to buy 20 drinks to receive one free drink.
Of course this doesn’t take into account food you might buy along with your morning coffee which would earn you points at Starbucks and Dunkin, but for comparison’s sake 7-Eleven’s reward program is great for morning coffee drinkers.
(They even have an election themed week to go along with National Coffee Day)
Why Is This Working for 7-Eleven?
7-Eleven is taking advantage of what they’re know for: their drinks. Beverages like soda, slurpees, and coffee are cheap to produce, buy, and sell. As a convenience store, making someone’s morning coffee possibly free to them brings them into the store in the morning. Once in the store people can buy more items like lunch for the day or a Gatorade for later.
7-Eleven has around 4,000 fewer stores than Dunkin Donuts or Starbucks in the United States and yet their app is still doing better. We can hypothesize about why this is but at the moment isn’t completely clear. Loyalty programs like CVS Pharmacy’s keep people coming back to the store. Better rewards means more returns. I can’t imagine Dunkin or Starbucks making their rewards easier to receive but 7-Eleven definitely took advantage of their markets and made their product alluring, cheap, and easy.
In honor of Gilmore Girls and their coffee at Luke’s that doesn’t have a rewards program app