24Seven: The Store Finally Slept

In a world full of hustle and hurry, a consumer keeps convenience as his/her top priority. Can there be something as convenient as getting almost all types of products? In a wide variety? Under one roof? That too at midnight? At accessible locations? 

To cater to this emotion, 24Seven was launched in India which welcomed its customers at any time of the day, quite literally! A retail store chain that was inspired by Japan’s culture of round-the-clock convenience stores. In a country, where streets are active at dark as well, where night owls are on a hunt to find some midnight snacks or have the urge to get cigarettes, 24Seven identified the gap to serve the market 24 hours, 7 days a week.

Birth of 24Seven

The very famous empire of the Modi dynasty was established by Gujran Modi in 1932, a multi-purpose serving company operating in various sectors mainly tobacco, food, and retail. The  KK Modi Group acquired a substantial piece of cake in the company named Godfrey Philips India Limited in 1936. The company mainly manufactured various types of cigarettes. The company launched its vertical “24Seven” in 2005 owned by Sameer Modi, the 3rd generation of the ModiCare group. To capture every type of customer, the stores were rich in all types of products, everything from groceries to freshly prepared food, cigarettes to cosmetics, etc.  To get a Marlboro at night, 24Seven was never away from sight.  The stores were opened strategically at India’s prime urban locations, where the lanes were alive even at midnight. In 2010, the brand had 50 stores, a century by 2015 and to date, a total of 154 24Seven outlets were present making their influence across north India.

Groceries or Laboratories 

24Seven proved to be the preferred go-to store for the midnight hunger. But the stores were more advantageous to someone else, not the customers but the ModiCare group itself! The store turned out to be a live market research laboratory. 24Seven became a market testing ground for the newly launched products under the group like Modi Food products, Colorbar, Indofils, and more. 24Seven was more than a convenience store for Modi Group, it was a supply route for selling the cigarettes of Godfrey Phillips. This helped the company to collect customers' databases, analyse their preferences, and work for future product development and design accordingly. By 2023, 24Seven had a revenue of 396 crores. With an average EBITDA of 8-9%, though decent, it helped the vertical stay profitable and highly strategic for the Modi care group.

Floods and Feuds

The 24Seven has never been stable since the death of the KK Modi in November 2019. Since then the ModiCare group has always been seen in courts with their internal family disputes. After the despise, Bina Modi, wife of Late KK Modi was appointed the president and MD of Godfrey Philips, however, the sons of Bina and KK Modi believed in splitting the property and getting their shares. These internal feuds led to instability in the performance of 24Seven.

Keeping the family disputes in court, the market outside attacked 24Seven with inflation, the operational costs went high struggling to keep up with the demands of the business. There was a major reason that led to the downfall of 24Seven and the impact was as quick as its name suggests, Quick-Commerce. Brands like BlinkIt, Zepto, and Swiggy Instamart provided the market with more convenience by getting midnight cravings delivered to doorsteps in just 10 minutes. Even the big giants like Reliance and Adani entered the retail market and shook the 24Seven platforms. 

Customer loyalty was something, 24Seven could never earn. There was a shift in the consumer preferences in the market that did not end up in the favour of the business. The sales of 24Seven literally went from 24 to 7. All these factors built a strong opinion of Godfrey Philips and it decided to take a swift exit from the business by March 31, 2024, leaving the stores alone at midnight unsecured. The store's net worth was plunged into a negative state, it was truly haunting for the company. 

The aspect not to be ignored is the workforce. One of the major sufferers of this tragedy was the employees who are now not working and are idle 24/7. A situation where they can finally sleep at night but now, they do not want to.  The company's mismanagement mismanaged the finances of these fellow victims.

Sleepless Solutions

After the closing of all 24Sevens, I had no outlet to go at midnight. So I was hit with some optimum solutions, yes of course at 3 AM. 

To have a deal with competitors rather than dealing with them. They can partner with Blink it and Zepto and get their products delivered through these apps that are exclusively manufactured by Godfrey Philips. To cover the losses and bring the ship above the sea, they could put a hold on the physical stores for a while to save fixed costs and start an online delivery system. They can analyse the customer data and check which products were least liked by the customers and then replace them with the products having the majority sales. One huge key driver that the 24Seven could not decode in the past 15 years is the presence on online social media platforms like BlinkIt and Swiggy. Expanding their online presence will stimulate people to get out of their beds and visit the stores. This also helps in increasing the brand loyalty.

Think of it this way, 24Seven was just a grocery/retail store open at midnight. Exactly, soon this USP started to fade. I believe 24Seven should offer some exclusive experience that truly sets it apart from its competitors. They can make seating arrangements and make it a small cafe cum retail outlet in the middle of the night while complying with the rules and regulations, providing a unique experience, and overcoming the dominance of online platforms.

Breaking News! Godfrey Philips has sold all 24Seven stores to a Delhi-based startup named “The New Shop”. 

Another retail idea with a new twist and turn this time? A term sheet has been signed already and the transaction is expected to close between end of the September to early October 2024. So can we say 24Seven has reincarnated into a new being, The New Shop? Will it be called an alternative of 24Seven or will it manage to establish its own identity? 24Seven’s journey left us with a strong lesson: to survive, you must evolve. Adapting to shifting market dynamics and prioritizing a customer-first experience is key. As The New Shop steps into the spotlight, it holds the blueprint to avoid past missteps, ensuring a seamless and innovative shopping experience that anticipates consumer needs over the next five years. or else they will also 

end up in heaven, like 24Seven.

Author: Anshul Sethi

Illustration: Parth Koul