Indonesian stores create "hang-outs" by incorporating seating and
low-cost, ready-made food.
As night falls, groups of twentysomethings gather at a trendy
hangout, chatting at tables laden with beer, iced coffee and nachos.
Some couples cuddle over chocolate pudding, while others groove to
music on their iPhones.
The nightspot has live bands, Wi-Fi and a growing clientele.
It also has a familiar green, orange, red and white sign
overhead: 7-Eleven.
"It's a new concept of hanging out," said Oka Dharmawan, 21, an
engineering student who meets friends at 7-Eleven almost every night
to log onto the wireless hot spot and drink Slurpees.
Ten years ago, young people in Indonesia gathered at food stalls
called warung to hang out and gossip. But with rapid economic growth
has come social change.
"People still like to talk about their lives, they like to
gossip," said Henri Honoris, the president director of Modern Putra,
7-Eleven's Indonesian franchisee. "Now we give them an alternative.
It's a warung with better quality."
The franchise's strategy has been to blend a convenience store
with inexpensive ready-made food and seating, which attracts
customers in a city desperately lacking outdoor recreation space and
snarled by traffic jams that often restrict mobility.
"The neighborhood 7-Eleven has become recreational," said Debnath
Guharoy, the Asian regional director for Roy Morgan Research, a
market research company based in Australia.
Sixty-five percent of the franchise's customers are younger than
30, and to reach them, it relies on another defining feature in
Indonesia: a love of social networking. In one of the world's most
plugged-in countries, 7-Eleven has 57,000 Twitter followers and more
than 44,000 Facebook fans.
Many of them spend hours surfing the Internet at 7-Eleven, which
never closes, allowing young people to gather late into the night.
When the store plays host to local bands, customers update their
social networking statuses and help draw bigger crowds.
And now that many Indonesians have more disposable income, they
are looking for what Mr. Honoris calls "affordable luxury." The
store's appeal to both the lower-middle class and the nouveaux
riches becomes apparent to anyone just looking at the parking lot,
where motorbikes sit next to Mercedes-Benz cars.
In many ways, the convenience store's evolution was a given in a
country like Indonesia, where the penchant for hanging out runs so
deep that there is a word for sitting, talking and generally doing
nothing: nongkrong.
Mr. Honoris said that he had seen the demand for a revamped 7-
Eleven early on, but that it had taken two years to persuade the
company, which has its headquarters in Dallas, to grant him the
franchise.
When 7-Eleven finally opened its first 20 Indonesian stores in
2009, its first expansion into a new country in 16 years, he found
that his knowledge of the market paid off.
Since then, Modern Putra, which is also the national distributor
for Fujifilm, has had its sales jump fivefold, reaching 320 billion
rupiah, or about $34.5 million, in 2011.
The company recorded a net profit of 57 billion rupiah last year.
"Before you had a dirty, sweaty little street shop, and that's
all there was," said Mr. Guharoy of Roy Morgan Research, referring
