Japan’s convenience channel has one of the highest penetration globally, and is also among the most innovative.

However, its roughly 56,000 convenience stores face challenges such as a declining Japanese population, shrinking labour force and rising costs impacting its margins. It has turned to digital and technological solutions to overcome these challenges and even improve the shopping experience.

There is much we can learn from the following examples we see in Japan:

AI to guide purchase decisions

Natural Lawson, the premium, health-focused convenience banner of Lawson, has as AI-powered digital wine sommelier to support shoppers in making their wine purchase decisions.

Shoppers can select options from a few different filters such as wine type and mood. Based on the shopper’s selected choices, the digital wine sommelier will then recommend several wine brands and types to purchase. The service is available in Japanese, English and Chinese.

This AI service engages shoppers and helps to drive greater spending in the BWS section.

Robots to carry out multiple functions

FamilyMart has a multifunctional cleaning robot in some its stores, which carries out multiple duties like floor cleaning, advertising and selling merchandise.

The robot cleans the floor up to five times daily, freeing up employee time for more value-added tasks such as customer service.

The robot also displays merchandise selected by store staff, which can drive impulse purchases. In addition, it has a digital screen that can be used for displaying product information and even retail media advertising.

Digital food ordering in store

7-Eleven has digital kiosks in some of its larger stores to provide shoppers with more options when ordering from its food counters.

Situated at different parts of the store including near the store entrance in some stores, this helps to drive impulse ordering of food even before shoppers reach the food counter. Furthermore, this also smoothens the ordering process by giving shoppers the option of skipping the queue at the food counter itself.

Supporting shoppers virtually

Several Lawson stores have digital avatars at the self-checkout to support shoppers requiring assistance. The digital avatars are operated by staff remotely.

This increases efficiency by allowing staff working remotely to provide assistance to shoppers in multiple stores, while maintaining customer service.

Robots to cook fried chicken

Lawson also has a digital flagship at Takanawa Gateway City, which cooks fried food such as fried chicken using AI robots.

Incorporating robots into cooking helps improve operational efficiency. However with the AI cooking robots in the backend and not visible to shoppers, this was a missed chance for the store to enhance shopper experience by letting them view the robots cooking.

What can we learn from Japanese convenience

Japan’s convenience retailers have shown many opportunities to innovate with technology such as AI, robots and other digital tools. This has helped them to achieve objectives such as improving operational efficiency, driving impulse purchases and enhancing customer service.

Another interesting learning point is in how despite automation, Japanese retailers have managed to maintain a strong customer service focus, which is important to many shoppers. The retailers do these by prioritising their technological operation on operation alduties such as robots cleaning the floor, which frees up more staff time for customer service.

For more insight on Japan, visit our Japan page.