Extreme Convenience – Extreme Private Brand

[KGVID width=”600″ height=”320″]http://c0000626.cdn2.cloudfiles.rackspacecloud.com/2016_04_Durham.mp4[/KGVID] This month’s edition of the Private Label Manufacturers Association’s (PLMA) web based video magazine PLMALive! includes my latest insights on private brand in convenience stores in the worlds densest convenient market Taiwan.

Extreme Convenience

If you had to select a place where convenience stores are king, you might not think of Taiwan in Asia but in fact Taiwan has the highest density of convenience stores in the world. There are 10,000 of them and it equates to approximately 1 convenience store for every 2,000 residents.

In the capital city of Taipei, there are more than 4,000 stores in a city of 23 million, which means it’s virtually impossible to walk a block without running into one. In addition to purchasing snacks, sodas and Slurpees, customers can pay credit card and utility bills, book travel arrangements, and buy small electronics.

It’s also not unusual for people to have packages delivered to their closest 7-Eleven instead of their home, because it’s more convenient to pick it up late at night instead of trying to coordinate with a deliveryman. The government even allows customers to pay traffic tickets and property taxes in the stores.

Taipei is the epicenter of convenience, with the largest concentration of 7-Eleven stores in the world, while No. 2 FamilyMart has 2,900, followed by Hi-Life and OK Mart chains with 1,296 and 880 shops, respectively.

According to government statistics, convenience stores sales significantly outpace both hypermarkets and supermarkets with $9.2 billion in sales, followed by hypermarkets with $5.7 billion, supermarkets at $5.2 billion and wet markets/mom-and-pop shops coming in at $5.2 billion.

Not surprisingly, these stores offer significantly more than chips and candy. They offer private brand taste experiences that include: sushi, ramen, dumplings, stinky tofu, dried soups, fresh ramen, fresh cut packaged fruit, tofu, sweet soy milk, ready to eat hot food, refrigerated ready to heat meals, fresh packaged breads and pastries and Taiwan’s signature desert, pineapple cake.

According to the Nielsen Global Survey of Private Label, the perception of private brand quality has improved over time for nearly half of Taiwan respondents. According to Nielsen, private brand has room to grow in Taiwan, too, due to two main factors: positive consumer perceptions and low market share. More than one-third of Taiwanese respondents are willing to pay the same or more for a store brand they like.

Convenience stores in Taiwan may not be similar to what you’re used to here in the U.S. but they combine convenience, experience and unique private brand products to build an ongoing relationship with their customers. It’s a model that retailers around the world might want to study.

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Christopher Durham
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.