29Sep2000 USA: 7-Eleven ads woo
women with high fashion image.
By Candace Talmadge
DALLAS, Sept 29 (Reuters) - In a first for a convenience
store operator, 7-Eleven Inc. has ventured into the world
of fashion with a full-page magazine advertisement that reads,
"New York. Paris. Milan. 7-Eleven."
Depicting a modestly posed yet scantily clad, long-legged
woman, the ad touts a new house brand of pantyhose called
Heaven Sent that Dallas-based 7-Eleven has been rolling into
its 5,700 U.S. and Canadian stores.
Along with a new house brand of eye shadow and lipstick called
Heart and Soul, and recently introduced items aimed at teenage
girls, the largest U.S. convenience store operator
is hoping the new merchandise will bring in more women, who
traditionally have been just 30 percent of its patrons. Males
between 18 and 34 typically have formed the rest of 7-Eleven's
- as well as the entire industry's - mainstay customer base.
"Convenience is more important to women," said Cheryl
Martineau, 7-Eleven category manager. "Women are more
willing to shop convenience stores now than they have been
in the past."
Martineau said 7-Eleven plans to deepen its selection of female-oriented
merchandise in the first quarter of 2001 by adding facial
and nail care products. For now, it's rolling out CD-size
compacts and mini compacts filled with Heart and Soul brand
eye shadow or lip colour, priced between $2.59 and $5.99;
teen-oriented bracelets; toe rings and key chains, costing
between $1.99 and $7.99; and Heaven Sent pantyhose, priced
from $2.99 to $4.69.
Dallas agency Coffee Black Advertising produced two versions
of a four-colour pantyhose print ad, which Martineau said
represents 7-Eleven's first foray into magazine advertising.
The first ad appears in the October issues of Cosmopolitan
and Glamour. The second, also a full page, is running in the
same month's issues of Working Woman and D, a Dallas city
magazine. The headline reads: "Three things you've never
seen in a trendy fashion ad." Copy lists the $1 off coupon
included in the ad, the 4-inch container in which each pair
of 7-Eleven pantyhose is packed and the 7-Eleven logo, which
is in both ads, along with the overall corporate theme, "Oh
Martineau said all of 7-Eleven's media buying is handled by
Camelot Communications Inc., Dallas.
According to Competitive Media Reporting, which tracks advertising
spending, 7-Eleven's 1999 consumer media spending was $26.9
million. Martineau declined to say whether the fashion ads
will affect this year's spending, although she did note that
they were currently scheduled for only one month.
"Broadening the stores' appeal makes sense," said
Andrew Ebersole, a bond analyst for KDP Investment Advisors,
a Montpelier, Vt.-based research firm that specialised in
high-yield bond analysis. "It's another demographic to
7-Eleven's concern about new customers appears to be shared
by the entire U.S. convenience story industry, which had 1999
revenues of $256.6 billion, according to the Franchise Finance
Corporation of America, a Scottsdale, Ariz., firm that provides
real estate financing for multi-unit retail operators. According
to a recently released FFCA report, convenience stores are
searching for ways to attract a wider range of consumers amid
fiercely intensifying competition. The report stated that
among problems convenience stores face are major oil company
consolidation, heightened competition from retailers such
as supermarkets and mass merchandisers, shrinking gasoline
margins and reduced income from tobacco purchases.
The industry is especially dependent on and worried about
tobacco sales, which have been under assault for a number
of years, noted Claire Pamplin, editor-in-chief of Convenience
Store News, a New York-based trade publication. In 1999,
CSN estimated that tobacco accounted for 34.9 percent of convenience
store sales, while health, beauty and cosmetic merchandise
provided just 1.31 percent of revenues.
"Even a percentage point or two growth in a product category
reduces the dependency on tobacco," Pamplin said.
She said this is one compelling reason for store operators
to expand their offerings in high-margin categories such as
health-beauty-cosmetics or fresh food.
"7-Eleven has always been known for dashboard dining,"
said company spokeswoman Dana Manley. She added that in the
next two months, new foods that appeal especially to women,
such as fresh-cut produce and salads, will start appearing
in the company's stores.
While bond analyst Ebersole thinks 7-Eleven is on the right
track, he said the jury's still out on the company's effort
to tilt its customer mix or raise overall revenue with its
women-oriented merchandising attempts. Earlier in September,
7-Eleven reported its 38th consecutive monthly increase in
U.S. same-store sales, which rose 5.7 percent in August, compared
with a 4.9 percent gain in the same month of 1999.
(C) Reuters Limited 2000.
REUTERS NEWS SERVICE 29/09/2000