For a long time, the core of retail discussions has been almost entirely about "channels." Whoever has more stores, denser networks, or is closer to consumers is seen as having a better chance to win. Later, with the advent of e-commerce and new retail, the industry began to emphasize digital transformation, private domain traffic, and livestream commerce, as if a strong system and massive traffic could solve all problems. But in recent years, we can clearly feel that the entire retail market is slowly returning to the most fundamental thing: products. Especially this year, the theme proposed by the China Convenience Store Conference, "Crossing Cycles, Deep Evolution," is truly worth deep reflection for the entire retail industry. As the market enters an era of intensified competition, consumer diversion, and price wars, many previously effective methods are gradually losing their efficacy.

Previously, opening a store guaranteed business; now, even with many stores, foot traffic may not come.

Previously, promotions could drive performance; now, consumers are weary of price wars.

Previously, convenience attracted customers; but now, food delivery platforms, discount snack stores, community group buying, and instant retail are heavily siphoning away demand that originally belonged to convenience stores. For this reason, we must rethink: what truly is the capability to cross cycles? Zhang Sihan, President of Costco Asia Pacific, stated in an exclusive interview that while everyone talks about digital transformation, artificial intelligence, and membership economy, Costco's core discussion is very traditional: products. It does not emphasize flashy membership gimmicks nor overly rely on data marketing, but instead invests substantial resources and energy into the product content itself.

  • What products are worth selling?
  • What products can create memorable points?
  • What products can make members willing to make a special trip?
  • What products can form repurchase habits among consumers? These questions may seem traditional, but they are the core essence of retail. In other words, the future of retail will gradually form a new operational logic: use product strength to cross cycles, and use membership economy for deep evolution. Because a truly powerful membership system must be supported by strong products; and retail enterprises that can survive long-term will also have their own product moats. Using product strength to cross cycles is becoming the new answer for retail. In the past two years, the retail market has felt a clear sense of pressure. On one hand, overall consumption has become rational; on the other, competition continues to intensify. Convenience stores are no longer just competing with other convenience stores; they also face multiple pressures from discount snack stores, bulk supermarkets, instant retail, livestream e-commerce, and food delivery platforms, leading to significant diversion of foot traffic. In such an environment, many companies' first reaction is often promotions, price cuts, discounts, and buy-one-get-one offers, hoping to pull back foot traffic. However, from market changes in recent years, relying solely on price wars is increasingly difficult to form long-term competitiveness. Because when everyone can be cheap, cheapness is no longer an advantage. What truly begins to differentiate is the product itself. The future competition in retail is gradually shifting from channel competition to product competition. In the past, as long as you had enough stores, good locations, and high foot traffic, business would naturally come. But now that consumers have more choices, a new phenomenon emerges: consumers are not without places to buy, but they prefer to choose where to buy. That is, consumers will make a special trip to a particular store for a certain product. This is actually very important because it signifies that the true core of retail is returning to product strength. Costco is a typical case. Many people think Costco's success is due to its membership system, but if you look closely at its operational logic, you'll find its real strength lies in long-term excellence in products. Its product assortment may not be the largest, but it emphasizes differentiation, quality, high cost-performance, unique specifications, topicality, and treasure-hunt appeal. Image source: Costco store. For example, it offers large-pack sizes and customized products not available in other channels, even differentiating toilet paper with three-ply thickness. This may seem like product details, but behind it is a deep understanding of consumer needs. Because truly powerful products are not those everyone has, but those that make consumers feel, "This thing seems only available here." Once this perception forms, products begin to have the ability to cross cycles. Because no matter how bad the economy, consumers will still buy what they recognize; no matter how competitive the market, consumers will return to products with memorable points. This is why some forward-thinking convenience stores are beginning to strengthen their product development capabilities. Including fresh food, coffee, private brands, desserts, co-branded products, regional limited editions, healthy eating, functional products, and even the currently popular emotional products, all are doing the same thing: rebuilding the reason for customers to visit through products. Image source: 2026 China Convenience Store Development Report. The greatest value of product strength is making customers willing to walk into your store again for a specific product. To some extent, this is also an important answer behind this year's convenience store conference theme "Crossing Cycles." Enterprises that can truly cross cycles are not necessarily the largest in scale, but often the ones that understand products best. From "selling products" to "making products," retail competition is entering deep waters. If the past retail competition was about store count, location, and channel capability, now it is about another thing: who is better at making products. Here, "making products" is not just about purchasing and selling, but includes product planning, demand insight, specification design, topic creation, and even lifestyle scenario design. Many truly viral products are often not traditional big-brand products, but rather those that seem ordinary yet have a certain feel. For example, Japanese convenience stores' strong desserts and frozen treats in recent years, Korean convenience stores' co-branded snacks, Taiwan convenience stores' coffee and fresh food, and even mainland China convenience stores' regional cooked food and private-label products, all share a common point: they are not just products, but a sense of life. What consumers buy is not just functionality, but also emotion, experience, and sharing. Image source: Convenience stores offering diverse experiences. This is also why many products spread quickly on Xiaohongshu and Douyin upon launch. Because today's products are no longer just items on shelves, but whether they can become part of social content. This has a huge impact on the convenience store industry. Because the original strength of convenience stores is standardization and efficiency. But in the future, if only efficiency remains, it can easily be replaced by systems, logistics, and platforms. What is truly hard to replace is product creativity. So you'll notice that many convenience stores are now showing several clear development directions. The first is private branding. Because only private brands can truly establish differentiation and gross margin space. From coffee, fresh food to snacks and daily necessities, everyone hopes to build their own product moat through private-label products. Image source: 2026 China Convenience Store Development Report. NielsenIQ data shows that in 2025, the penetration rate of private brands in national convenience stores reached 83%, up 12 percentage points year-on-year; some local leading brands have private SKU ratios of about 15%-20%, and industry private brand gross profit contribution is about 30%. Undoubtedly, private brands have become an important lever for convenience stores to create differentiation. The second is limited editions. Many products no longer pursue perpetual sales, but create scarcity through seasons, co-branding, and regional limits. Because when products have time constraints, consumers make purchase decisions faster. This treasure-hunt feel is very powerful because it forms a habit of regular store visits. The third is contextualization. Products are increasingly not single items, but lifestyle proposals. For example, convenience store coffee is no longer just coffee, but a work rhythm; fresh food is not just bento, but a quick solution in busy life; desserts and co-branded products are more like healing and small happiness. Using membership economy for deep evolution, turning products from "hits" to "habits." If product strength is the most important capability for convenience stores to cross cycles, then membership economy is the core of the next stage of deep evolution. Because products can bring one-time foot traffic, but the real power of membership management lies in turning a single purchase into a long-term habit. In recent years, domestic convenience stores have clearly moved in this direction. In the past, convenience store membership mostly involved point collection, discounts, and promotions. But now, membership systems are gradually becoming a lifestyle entry point. For example, coffee prepaid cups, APP pre-orders, cross-store pickup, member discounts, points ecosystems, parcel self-pickup, ticketing services, and even the mature "buy anywhere, pick up anywhere" feature, are all doing the same thing: forming a higher-frequency contact relationship between consumers and convenience stores. Image source: Uni-President Supermarket annual report. This is very important because the biggest challenge for convenience stores now is not just competition, but diversion. In such an environment, if convenience stores only sell things, they will become increasingly difficult. So in the future, besides products, it is also crucial to bind products with consumers' lives through membership systems. For example, coffee is not just coffee, but through member prepaid cups, it forms a fixed repurchase; fresh food is not just bento, but through APP discounts and point feedback, it increases usage frequency; store parcel pickup is not just a logistics service, but pulls people who wouldn't come to the store back. Behind this is a very important logic: the real power of membership economy is not discounts, but habit formation. Once a habit is formed, consumers become less price-sensitive and more dependent on the brand. To some extent, future convenience store competition may gradually form two main axes: front-end uses product strength to create reasons to visit, and back-end uses membership economy to increase return frequency. When these two combine, convenience stores truly have the opportunity to achieve so-called deep evolution in a highly competitive market. Conclusion: The biggest change in the retail market in recent years is not technology, but that consumers have begun to change. In the past, consumers pursued convenience; now, they pursue worthiness. Worth spending money, worth making a special trip, worth repurchasing. Because of this, the convenience store industry is slowly shifting from channel thinking back to product thinking. Previously, the comparison was on store count; now, it's about who understands products better, who understands consumers better, and who can create reasons to visit. Because as food delivery platforms, discount snack stores, instant retail, and various new formats continue to divert traffic, the truly important issue for convenience stores is not whether people pass by, but why consumers should come in. Image source: 2026 China Convenience Store Development Report. And this answer increasingly returns to the product itself. In the future, convenience stores that can truly cross cycles will often have their own product moats. It could be coffee, fresh food, desserts, private brands, or a lifestyle proposal that only you can create. Because what consumers ultimately remember is never the system, but the feelings and memories brought by products. But product strength alone is not enough. Because products can bring one-time foot traffic, but the real power of membership economy is that it makes consumers keep coming back. When product strength and membership economy begin to combine, convenience stores gain not just single transactions, but longer-term, higher-frequency, and more stable consumer relationships. This year's convenience store conference theme "Crossing Cycles, Deep Evolution" points out a very important direction for future convenience stores. Crossing cycles relies on product strength; deep evolution relies on membership economy. In the future, truly powerful convenience stores are not necessarily those with the most stores or the most aggressive promotions, but those that can make consumers say one thing: "This thing, I'm used to buying it here." Once this habit forms, convenience stores truly possess the ability to navigate market fluctuations.