7-Eleven Business Strategies Analysis

This assignment tasks students with analyzing 7-Eleven's current business strategies using a SWOT analysis framework. It requires examining the company's internal strengths and weaknesses, as well as external opportunities and threats. Students are also expected to evaluate 7-Eleven's marketing mix (product, price, promotion, place) and propose improvements to enhance their market position and growth potential.

Running head: INTRODUCTION TO MARKETING
Introduction to Marketing
Name of Student
Name of University
Author Note

1
INTRODUCTION TO MARKETING
Executive Summary
The report focuses on the prospects that exist with proper marketing technique. The
effectiveness of analysing the internal and external business environment is provided to get
an idea about the strategies that need to be followed. The report conducts an analysis of 7-
Eleven, an American-Japanese convenience store. The external environment analyses using
PESTEL analysis shows that the biggest threats faced by the company are from the economic
and legal factors. SWOT analysis is conducted to analyse the internal potential of the
company. The report identifies the target market for the company and provides an idea of
setting up a store in the residential areas in the United States. The development of online
shopping facility for the company is recommended in the report.

2
INTRODUCTION TO MARKETING
Table of Contents
Section 1: Introduction and background of the company..........................................................3
Section 2: Analysis of the external and internal environment...................................................3
Section 3: Recommendation......................................................................................................7
a. Target market:.....................................................................................................................7
b. New product/service description:.......................................................................................8
c. Relevant marketing mix:.....................................................................................................8
Section 4: Conclusion and recommendation..............................................................................9
Reference..................................................................................................................................10

3
INTRODUCTION TO MARKETING
Section 1: Introduction and background of the company
The report covers the prospects of marketing and the ways by which the marketing
elements can be used to gain success in the competing business market. The report analyses
the internal as well as the external environment that affects the growth of an organisation.
The purpose of the report is to analyse the factors that affect a business organisation and the
possible responses that can help it to remain competitive. A SWOT analysis is conducted for
analysing the internal factors that affect an organisation. The purpose of the SWOT analysis
is to identify the strengths and opportunities that an organisation possesses. Apart from this, it
also helps in identifying the threats and weaknesses (Bull et al., 2016). The value of SWOT
analysis is that based on it, organisations can make rectifications in their work structure. For
the purpose of the essay, 7-Eleven has been considered.
7-Eleven is a convenience store headquartered in Texas. The parent company,
however, is located in Chiyoda, Tokyo. This company is a collaboration between the
Americans and the Japanese for improving their line of business. The company was set up in
1927 and currently have over 56,000 stores in 18 countries. The company started by selling
eggs, milk and bread form a house located in Dallas. Despite the fact that grocery stores were
available, the selling of bread and milk in convenience stores can help customers avoid long
distance travels. The concept became popular and currently, the company is one of the largest
convenience stores in the world providing work to over 45,000 employees. The product line
of the company includes beverages, prepared foods, gasoline and souvenirs. These daily use
items provide the company with an advantage to attract the customers (7-eleven.com, 2018).
Section 2: Analysis of the external and internal environment
In order to gain a competitive advantage, it is important that companies conduct a
thorough analysis of the external as well as the internal business environment. This helps the
companies to understand the competitors and the possible threats that may receive while
conducting a business. Based on the analysis strategies can be formed that can help an
organisation to excel (Babin and Zikmund, 2015). In the case of 7-Eleven, the company need
to conduct a similar analysis that can help the company to strive for more success in the
business market. Hence, to conduct a proper analysis of the external factors it is important
that the managers of 7-Eleven conduct a PESTEL analysis.

4
INTRODUCTION TO MARKETING
The PESTEL analysis normally consists of the factors such as political, economic,
social, technology, environmental and legal. These factors are important as it helps an
organisation to understand the environment in a proper manner particularly during the time of
expansion or during the launch of new products (Besharov and Smith, 2014). The analysis of
these factors for 7-Eleven is conducted to understand the manner in which the company can
deal with the issue.
Political: The political factors consist of the political turmoil that marks the progress
of a nation. In the USA, the political factor plays an important role in the success of an
organisation. A good political relationship with the USA helps companies from foreign lands
to achieve success in the country (Cavusgil et al., 2014). In the case of 7-Eleven, this factor
does not pose a threat as the company collaborates with the Japanese company. The friendly
ties between the political delegates of Japan and America help 7-Eleven to attain competitive
advantage in the country.
Economic: The economic factor is always a huge threat to companies. This is because
fluctuations in the economic condition may hamper the profitability of the organisations. A
fall in the economic condition can dent the purchasing of the buyers. This can be a huge loss
for the companies, as the prices of the products need to be dropped to continue its sales
(Chaffey and Ellis-Chadwick, 2016). Despite supplying products that are required to meet
daily requirements 7-Eleven may also be a victim of the economic instability. This is because
customers may prefer to buy cheap products from local stores rather than provide expenses in
an internationally reputed convenience store.
Social: The social factor normally denotes the customers and the potential target
market of organisations. Every company need to analyse the social backgrounds of the people
so that the type of products that need to be sold are determined. Apart from this, the social
status of the people helps in determining the price of the products (Dibrell et al., 2015). 7-
Eleven need to analyse the social status of the people and based on this they can price the
products. Identifying a target market is needed and the prices can be determined by analysing
the economic condition as well.
Technology: In the modern day, technology plays an important part in the strategic
decisions of an organisation (Fan et al., 2015). It is necessary for every manager to equip the
organisations with the latest technologies that are launched in the market. In the case of 7-
Eleven, the latest technologies can be the availability of mobile applications and online

5
INTRODUCTION TO MARKETING
shopping. This can help the organisation to gain more customers and increase their
dominance in the market. However, it needs to be kept in mind that proper human resources
exist in the company to undertake the proceedings of the technical developments.
Environmental: Environmental factors focus on maintaining sustainability in the
community. It is the modern motto of every organisation to maintain a sustainable practice so
that the environment of a community is not disrupted. Hence, sustainable development is one
of the most important factors of an organisation that helps it to achieve success (Armstrong et
al., 2015). The products sold by 7-Eleven are not considered to be harmful to the
environment. This is mainly because the products are manufactured in a way that it
encourages only one-time use. Apart from this, the laws related to the conservation of
environment are strict in the USA and in Japan. Hence, the company avoids the use of
plastics and other harmful chemicals for the manufacturing and selling of products.
Legal: The legal laws related to setting up an organisation and conducting business is
strict in the United States. This is mainly because the country focuses on conducting business
with other countries that have a good political relationship with them. Similarly, setting up a
local business need to go through a lot of paperwork before being registered as a legal
company (Fleischmann et al., 2014). This does not pose a threat to 7-Eleven as the company
collaborates with Japan. However, violation of company and ethical laws are considered as a
punishable offence in the country.
PESTEL

6
INTRODUCTION TO MARKETING
Figure: PESTEL framework
(Source: Ginter et al., 2018)
After the analysis of the external factors, the internal factors of the company can be
analysed by conducting a SWOT analysis. The purpose of SWOT analysis is to identify the
areas of strength, weakness opportunities and the threats that a company may have (Hamilton
and Webster, 2015).
Strength
 Convenient location
 Brand equity
 Diversity of income
Weakness
 High rental cost
 High cost of staffs
 Franchises
Opportunity
 Development of market
 Co-branding locations
 Increased product offerings
Threat
 Competitors
 Availability of online shopping
 Shoplifting
Table 1: SWOT analysis
(Source: Created by author)
The SWOT analysis shows that the biggest strength of 7-Eleven is the fact that it has a
convenient number of stores in various locations. The company has over 50,000 stores all
across the globe in countries that can provide enough profit to the firm. The brand equity of
the company is such that customers tend to favour the store owing to its stability of gaining
revenue in every outlet. The brand equity helps in gaining customer loyalty and reduces the
price sensitivity issue. Apart from this, due to the collaboration with Japan, the company have
a diverse form of income. This provides a stability of income and the company can have
proper financial results to every extent (Jackson and Ahuja, 2016).
However, the weakness also results from the strength of the company. Due to more
stores being located all over the world, the cost of maintaining it is high. Similarly, the cost of
the labour is also high, as the people have to work 24 hours a day for its success. Without
proper income level, the company can fail to pay the employees. Another weakness is that
since the company is located in different places, franchises are made that make it difficult to
gain control.

7
INTRODUCTION TO MARKETING
It can be said that despite the weaknesses 7-Eleven have opportunities in developing
the market continuously. Every year the company tries to innovate its product and services so
that it can expand more in the business. The stores are normally set up in large areas that
make it convenient for the company to store more products for future development. Hence,
the innovated products can be stored and used in crises (Kline, 2016). Another opportunity of
the company is that it covers a huge geographical area with its retail offerings and being
partners with local firms. For example, entering into a partnership with a coffee chain can
help the company to get more expansion in the market.
However, the biggest threat to the company comes from the competitors.
Organisations like Exxon Mobil Corporation, Royal Dutch Shell and D&B Hoovers are some
of the competitors of the company. The fact that these companies possess the facility to
provide online shopping opportunities to customers provides a huge threat for 7-Eleven.
Apart from this, shoplifting in the USA is quite popular. As mentioned earlier 7-Eleven
covers a huge area of land and as a result, it becomes convenient for shoplifters to perform
their deed.
Section 3: Recommendation
a. Target market:
In order to identify a target market, it is necessary for managers to identify the
segments that define a customer. These segments can be identified by conducting a proper
market research and ensuring that the segments are identified based on the behaviour of the
people (Hollensen, 2015). It is to be noted that the market segmentation needs to be based on
the characteristics of the consumers and the location of the people in the society. Hence, it
can be said that in case of 7-Eleven, the company need to target customers based on the
characteristics and the responses they provide to the products of the company.
Geographic Demographic Behavioural Psychographic
7-Eleven is located
everywhere and it is
important that the
company choose a
convenient location.
In the US, the
The company can
target every people
as the products sold
can be used by
people of all age and
gender
Customers that
provide value to the
products need to be
targeted by the
company. Therefore,
the target market
The simple nature of
the products sold by
7-Eleven can suit any
lifestyle and
personality.

8
INTRODUCTION TO MARKETING
company needs to be
located in residential
area so that the
people can gain easy
access to the stores
needs to be loyal so
that the company can
earn more profit
Table 2: Market segmentation
(Source: Created by author)
Thus, based on the analysis of the marketing segmentation, it can be said that 7-
Eleven needs to target the customers that live in residential areas. The area covered by the
company can be within a range of 30 metres from the place of the location of the store. The
type of products that the company provides can be a firm favourite for the young generations
and for people interested in cooking activities.
b. New product/service description:
Based on the SWOT analysis, it can be said that the major improvement of 7-Eleven
needs to be in the form of providing online services to the customers. In the modern day, this
is an important factor, as most people tend to prefer to shop online (Meyer and Peng, 2016).
Customers prefer to sit at home and order for products. Hence, it is important for 7-Eleven to
develop services that provide online shopping facilities and provisions to deliver products at
home. The SWOT analysis provided the fact that the competitors of the company are well
equipped in providing online shopping. Hence, this important development needs to be
undertaken by 7-Eleven to elevate its competitiveness in the market. Based on this, 7-Eleven
can analyse the marketing mix of the services provided.
c. Relevant marketing mix:
The relevant marketing mix of the company can be focused on the services that need
to be provided by the company. The development of the new online shopping facility needs
to be such that it can reach the target market. Hence, the elements of the marketing mix can
be analysed separately to provide an idea of the implication of the new service.
Product: The product that needs to be delivered to the target market can be of any
type. This can open up the chances of increasing the profitability and customers can choose
from a wide range of products (Huang and Sarigöllü, 2014).

9
INTRODUCTION TO MARKETING
Price: 7-Eleven can provide discounts on the products purchased online. However, if
any product needs to be delivered beyond the 30-meter area from the place of the store needs
to be charged extra. This can be an effective profit-making strategy for the company.
Place: The place of the store needs to be located in the residential areas with services
being provided to any area within the distance of 30 meters. The restriction can help 7-Eleven
to focus on the target customers and provide the best quality service (Pati et al., 2018).
Promotion: The promotion of the development of the new service can be done via
advertisements on a social network. This can help the customers get the link directly and visit
the stores for ordering products online (Wild et al., 2014).
Physical evidence: The physical evidence can be a denting factor for 7-Eleven as the
quality of milk and egg needs to be tasted by the customer before purchasing. This is
important, as the people need to be certain about the quality provided by the store (Lim,
2018).
People: The target customers are the people that need to be focused on. The younger
generation needs to be the prime target for the online service as the consumption of beverages
does not need physical evidence as compared to the purchase of other consumable goods.
Process: The process used for delivering the goods need to effective. The motto for
the company needs to deliver the goods within 24-48 hours depending upon the availability
of the products. The company need to abstain from taking full payment in case of delay in
delivery.
Section 4: Conclusion and recommendation
Hence, it can be concluded that to improve the products and services of an
organisation, it is necessary that 7-Eleven elevate its strategies in a way that it can help in
improving the stores. The introduction of online shopping application can help the company
to reach out to the customers and meet their requirements. To eliminate the weakness of the
company it is necessary that 7-Eleven employ more people to take care of the franchises. The
type of payment provided to the employees needs to be based on the work done in a quality
manner. Thus, these changes can help 7-Eleven grab the opportunities that are presented in
front of them and become one of the most reputed stores in the world.

10
INTRODUCTION TO MARKETING
Reference
7-eleven.com, 2018. 7-Eleven | Your Go-To Convenience Store for Food, Drinks, Fuel &
More. [Online] Available at: HYPERLINK "https://www.7-eleven.com/" https://www.7-
eleven.com/ [Accessed 19 January 2018].
Armstrong, Kotler, Harker & Brennan, 2015. Marketing: an introduction. Pearson Education.
Babin & Zikmund, 2015. Exploring marketing research. Cengage Learning.
Besharov & Smith, 2014. Multiple institutional logics in organizations: Explaining their
varied nature and implications. Academy of Management Review, 39(3), pp.364-81.
Bull et al., 2016. Strengths, weaknesses, opportunities and threats: A SWOT analysis of the
ecosystem services framework. Ecosystem services, 17, pp.99-111.
Cavusgil et al., 2014. International business. Pearson.
Chaffey & Ellis-Chadwick, 2016. Digital marketing. Pearson.
Dibrell, Fairclough & Davis, 2015. The impact of external and internal entrainment on firm
innovativeness. A test of moderation. Journal of Business Research, 68(1), pp.19-26.
Fan, Lau & Zhao, 2015. Demystifying big data analytics for business intelligence through the
lens of marketing mix. Big Data Research, 2(1), pp.28-32.
Fleischmann et al., 2014. Subject-oriented business process management. Springer
Publishing Company.
Ginter, Duncan & Swayne, 2018. The Strategic Management of Organizations. John Wiley &
Sons.
Hamilton & Webster, 2015. The international business environment. Oxford University
Press.
Hollensen, 2015. Marketing management: A relationship approach. Pearson Education.
Huang & Sarigöllü, 2014. How brand awareness relates to market outcome, brand equity,
and the marketing mix. In Fashion Branding and Consumer Behaviors. Springer New York.

11
INTRODUCTION TO MARKETING
Jackson & Ahuja, 2016. Dawn of the digital age and the evolution of the marketing mix.
Journal of Direct, Data and Digital Marketing Practice, 17(3), pp.170-86.
Kline, 2016. The concept of'marketing mix'and its elements (a conceptual review paper).
International journal of information, business and management, 6(2), p.95.
Lim, 2018. Social pay reference point, external environment, and risk taking: An integrated
behavioral and social psychological view. Journal of Business Research, 82, pp.68-78.
Meyer & Peng, 2016. International business. Cengage Learning.
Pati et al., 2018. Business model design–performance relationship under external and
internal contingencies: Evidence from SMEs in an emerging economy. Long Range Planning.
Wild, Wild & Han, 2014. International business. Pearson Education Limited.