How the Convenience Store Channel Can Stay Relevant  5/25/2017

For several years I lived next door to a 7-Eleven gas station, which I would visit daily for a quick coffee, snack, batteries, or its awesome buffalo wings, which are still among my favorites. During that time, I noticed some changes. The convenience store’s food and snack offerings were getting healthier, there were more foodservice options, an increasingly unique mix of products at the point of sale – ranging from electronics and adult coloring books to costume jewelry and bananas -- and more signage promoting digital engagement via its app.

This evolution is representative of how best-in-class convenience store operators are adapting to changing consumer demands and shopping habits, and addressing the channel blurring that’s occurring at retail – something that all convenience stores need to do to thrive in today’s retail environment, according to recent data from The Nielsen Co.

According to the research, while most (85 percent) of convenience store sales come from six key categories (cigarettes, packaged beverages, candy, beer, salty snacks, and other tobacco), subcategories like enhanced water, craft beers, ready-to-eat meals, electronic cigarettes, tools, housewares and sparkling wine saw mid- to high-double-digit growth in the channel last year.

In order to remain competitive, convenience store chains need to “get the product mix right (evolving when needed), emphasize health and wellness, and think beyond RTE,” according to Nielsen. Here are some recommendations based on the research:

Speed: Follow the QSR lead in ensuring that consumers looking for a quick meal can find what they are looking for and get in and out of the store fast. My local 7-Eleven accomplished this with its foodservice stations, which were right next to the checkout (I got my buffalo wings in two minutes), as well as refrigerated gondola with fresh sandwiches, ready to heat burgers and breakfast sandwiches, and salads.

Healthy Options: Incorporate fresh and natural foods into your assortments. The 7-Eleven by me not only offered salads and packaged sliced fruit, but it also had fresh fruit at the front end, as well as – my favorite healthy snack – slices of beef jerky, sold in individual strips from a case at the register. Some convenience stores have already jumped on this trend; many airport convenience stores, for example, are selling organic snacks, and enhanced beverages and shots (see the image above, which I snapped at a convenience store in LaGuardia Airport.

Evolve Assortments: Expand into fast-growing categories, particularly those that are relevant but not typical of traditional convenience stores (such as the tools and housewares categories mentioned above, which can be merchandised as impulse items or handy solution-sets)

Focus on Digital: Engage shoppers via digital, whether it’s through an app or social media like 7-Eleven, or rewards programs that deliver value.

By focusing on these three key areas, convenience stores will expand their relevance to a larger consumer base, which will serve as a hedge against the current channel-blurring taking place.

Joseph Tarnowski

VP Content

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