Lawson’s 2024 Strategy: Innovative Products and Consumer Insights Behind Success
Lawson, one of Japan's largest convenience store chains, has undergone significant changes as it gears up for 2024. Following the successful completion of KDDI's tender offer, the company has seen its management structure shift, with KDDI now holding 50% of the voting rights, alongside Mitsubishi Corporation. Despite these changes, Lawson's domestic operations continue to thrive, achieving record profits and setting the stage for potential competition with rival 7-Eleven.
While KDDI's acquisition marks major corporate changes, Lawson's success is attributed largely to its innovative approach to product offerings and consumer behavior analysis as articulated by its president, Sadanobu Takamatsu. "We’ve made strategic adjustments to our inventory to cater to changing consumer needs," he noted during an interview.
One of the most notable shifts has been how consumer purchasing behaviors have evolved, particularly influenced by the effects of the COVID-19 pandemic. With the summer heat pushing drink sales up, Lawson also witnessed unexpected trends such as sales spikes for hot noodles, which have typically been more popular during the winter months. This change highlights how immediate consumption needs have shifted, especially considering more people are dining at home than before. Takamatsu states, "The adjustments made during the pandemic have helped us connect with our customers’ new habits. Hot noodles, once considered cold weather food, have become part of our summer lineup thanks to changing consumer preferences."
To respond to inflationary pressures and rising costs, Lawson introduced successful private brand (PB) products. Among these, the standout is their unique no-filler ramen, which has been well-received for its quality and price point. The president emphasized this product's appeal, stating, "Creating something entirely new yet familiar captures the essence of modern convenience store culture. It’s about enhancing the shopping experience and delighting our customers with surprises."
Despite facing challenges, such as reduced late-night snack sales post-pandemic, Lawson has prioritized developing creative products to meet demand. The impacts of decreased social drinking have also been felt as evening purchases of cup noodles and ice cream linger below pre-COVID levels. To adapt, Lawson has emphasized its private brand products as not just alternatives, but appealing options worth choosing.
Another intriguing product innovation involves the launch of mayonnaise-themed beverages aimed at passionate condiment aficionados, reflecting Lawson's commitment to bringing unique items to the shelves. Takamatsu explains, "Our product development aims to create something people haven’t seen before, but closely associated with convenience. The idea is to engage our customers by adding layers of enjoyment to their shopping experience."
Competitors are also adapting to today’s market dynamics, with FamilyMart seeking to grow its market share through its Apollo Project which involves store expansion and increasing shelf space. Meanwhile, Lawson is focusing on solving its staffing difficulties with innovative strategies, which Takamatsu promises to reveal soon.
Lawson’s product range also includes popular prepared foods, indicated by the excitement surrounding their top items for 2024. Among customer favorites, one shining example is the "Tenkaippin Super-rich Cheese Curry Bun," which has been highlighted for its rich curry sauce and cheese blend, exciting taste buds throughout the country. Another beloved item is their "Coarse Minced Meat Cutlet Burger," known for its juicy, meaty flavor profiles, showcasing Lawson's knack for delivering delicious ready-to-eat options.
Lawson’s "Half-boiled Curry Bread" has also carved out its space, delivering exceptional taste and convenience for on-the-go meals. The bakery division of Lawson seems to have struck gold with its inventive offerings, positioning the brand favorably with consumers dwindling under tight schedules.
The "Onion Cheese Bread" stands out not only for its taste but also as part of broader trends where consumers increasingly appreciate complex flavor combinations. The value proposition continues with the "Tatsuta Fried Chicken Burger," combining crispy chicken with flavor-infused tart sauces, appealing to fans of both fast food and traditional Japanese cuisine.
Through evaluating both the insights from executives and the preferences displayed by consumers, Lawson seems well-positioned to address the prevailing challenges of convenience store management moving forward. The initiatives put forth promise not only to preserve their market position but potentially allow for expansion against their competition.
While the competition continues to evolve, the strategies and innovations implemented by Lawson highlight their adaptive nature and commitment to excellence. The success of their unconventional products and insights from leadership reveal how they have not just survived but thrived, providing consumers with diverse options to suit their rapidly changing lifestyles. One can only speculate how these recent shifts will shape the future of convenience retailing and whether Lawson can maintain its competitive edge as it seeks to win over consumers who increasingly demand variety and quality.