7-Eleven has become a trendy hangout in Indonesia, with live bands, Wi-Fi and a growing clientele chatting at tables laden with beer, iced coffee, and nachos. Each location has the familiar green-and-orange 7-Eleven sign hanging overhead. The company’s expansion into Indonesia was its first foray into a new country in sixteen years.
Indonesian young people gathered at street-side food stalls called warung ten years ago to hang out and gossip. 21-year-old engineering student Oka Dharmawan said of 7-Eleven, “It’s a new concept of hanging out.” He meets his friends at a local 7-Eleven nearly every night to log onto the wireless hot spot and enjoy Slurpees.
Henri Honoris, president director of Modern Putra, 7-Eleven’s Indonesian franchisee, said, “People still like to talk about their lives, they like to gossip. Now we give them an alternative. It’s a warung with better quality.” Mr. Honoris said that he spotted the potential for a revamped 7-Eleven early on, but it took two years to persuade the company to allow him to build the locations. In 2009, 7-Eleven opened its first 20 Indonesian stores.
The company’s strategy has been to combine a small supermarket with seating and inexpensive ready-made food. The combination attracts a wide array of customers in a city lacking outdoor recreation space and slowed by nearly constant traffic jams. 65% of 7-Eleven’s Indonesian customers are younger than 30 and many of them spend hours surfing the Internet at the locations, which never close.
7-Eleven revamped its sales strategy to appeal to the local tastes of the world’s most populous Muslim country. Many stores offer a variety of local and exotic cuisines, including ready-made fried rice, doughnuts and chicken katsu, a Japanese-style fried cutlet. Beverages offered include its signature Big Gulp soft drinks, flavored-ice Slurpees, and beer and wine coolers (depending on the approval of the local community). Meals can cost less than 23,000 rupiah and many customers like the comfort of being indoors and the international food options.
Debnath Guharoy, Asia director for Roy Morgan Research, said, “The neighborhood 7-Eleven has become recreational.” He continued, “Before you had a dirty, sweaty little street shop, and that’s all there was. Now you can go to a clean, air-conditioned shop and it’s a better experience.” In Indonesia, 7-Eleven has 57,000 Twitter followers and more than 44,000 Facebook fans.