[Convenience Store Empire] The Rise of Mobile Apps... Expanding Online Territory

⑭Core Business Emerges in App Services

CU Doubles New App Subscribers
GS25 Focuses on Connecting Digital Businesses
Subscription Services and Alcohol Pickup Gain Popularity

Convenience stores are putting their lives on the line to expand their online territory. As the domestic convenience store market reaches saturation, expanding offline stores is not easy, and the non-face-to-face trend has spread due to the COVID-19 pandemic. Each company is focusing on securing loyal customers by strengthening mobile application (app) services and conducting customized discounts and events.

Customers are receiving products ordered through the CU application (app).
[Photo by BGF Retail]

Number of Mobile App Users 'Soars'

According to CU on the 9th, as of the end of last year, the average daily new sign-ups for Pocket CU doubled compared to the previous year, and the number of active members exceeded 3.5 million. At GS25, the app installation growth rates compared to the previous year were 78.4% in 2020, 57.3% in 2021, 229% last year, and 125.2% from January to April this year. The monthly active user growth rates were 47.6% in 2020, 23.7% in 2021, 57.1% in 2022, and 33.6% from January to April 2023. At 7-Eleven, app installations increased by 50% in 2021, 370% last year, and 30% from January to April this year. Monthly active users increased by 35% in 2021 compared to the previous year, 120% in 2022, and 330% from January to April 2023. After remodeling its app at the end of last year, Emart24 saw its average daily active users for one month increase by 193% compared to the same period the previous year, and the current monthly active users are on an upward trend.

Convenience stores are focusing on building an online ecosystem as a core business this year. At last week’s shareholders’ meeting, Lee Geon-jun, CEO of BGF Retail, emphasized, “We will build and expand CU’s unique online ecosystem in line with the shopping trend that crosses online and offline,” adding, “We will strengthen services such as Store Plus, which enables differentiated events by store, and realize a one-stop shopping platform for customers and franchisees.” Huh Yeon-soo, CEO of GS Retail, stated, “We will maximize the performance of our core business through digital business connections,” and “We will strive to build overwhelming competitiveness compared to competitors in all areas, such as optimizing product assortments by commercial district and streamlining event and promotion operations.”

Diverse Services and Abundant Discount Benefits

Various services and discount benefits can be found on convenience store apps. Especially, by using subscription services, customers can purchase lunch boxes, coffee, and more at discounted prices. CU operates 20 subscription products, and the number of uses from January to April this year increased 2.5 times compared to the previous year. During the same period, sales of Our Neighborhood GS Club One Meal at GS25 grew by 158.4%, and Our Neighborhood GS Club Cafe 25 increased by 188.6%. 7-Eleven’s subscription service sales rose by 50% compared to the same period last year, and Emart24’s sales jumped by 381%.

Alcohol pickup services have also become a trend. When customers reserve and purchase desired products through the app, they can pick them up at the designated date and store. CU offers over 1,200 products including beer, wine, and spirits, with sales from January to April this year surging 165.6% compared to the previous year. GS25 handles over 7,000 products, with sales increasing by 48% year-on-year. At 7-Eleven, alcohol pickup service sales rose by 30%, and at Emart24, by 104%.

There are also benefits exclusive to the app. At CU, users who access the app this month and spin the roulette can earn up to 10,000 points. GS25 provides discount coupons for about 10 products every month and offers discount coupons according to membership levels. 7-Eleven offers a 10% permanent discount when ordering lunch boxes, kimbap, and more in advance. At Emart24, users can earn gold and rubies through in-app games; gold can be exchanged for game items, and rubies for discount coupons. Each company applies automatic telecom discounts and membership point accumulation upon first-time registration during payment.

An industry insider said, “Various services linking apps and offline stores and benefits provided on mobile are receiving positive responses from customers,” adding, “We will continue to develop the app system to maximize convenience and differentiation.”