11 More Highlights From CSP's Convenience Retailing University 2017
By CSP Staff on Feb. 28, 2017GLENDALE, Ariz. -- Retailers, suppliers, consultants and other speakers offered data, insights and strategy in multiple convenience-store product categories during CSP's Convenience Retailing University in Glendale, Ariz., this past week.
Here are 11 more highlights in tobacco, beverages, foodservice, snacks and more from the annual conference ...
1. Breaking down barriers
Sales of recreational marijuana are expected to surpass medical-marijuana sales this year, according to Chris Walsh, editorial director for Marijuana Business Daily. In the wake of California voters last fall approving a law allowing recreational-marijuana sales, that state alone will have double or possibly triple the current national sales figures.
2. Food forward
Coming off a couple of strong years, retailers in CSP’s latest retailer survey said they intend to reinvest in foodservice. What type? Internal, proprietary offers, with many hoping to upgrade their programs in a substantial way.
3. What’s in a name?
Two tobacco brands seemed to be the topic of collective murmuring in the product gallery. Zyn—an OTP (other tobacco product) that seems to be doing well with smokeless consumers—and the newly emerged-from-bankruptcy brand NJOY. Retailers were ready to introduce Zyn, but its availability outside of certain regions is limited. NJOY received a mixed review, with some retailers still stinging from the fallout of its bankruptcy and others who still find it a profitable brand.
4. Expanding fountain …
Retailers in a conversation about dispensed beverages found common ground on several categories that show promise for c-stores, including growlers, dispensed protein beverages, expansion of cold brew and more frozen options. For Holiday Stationstores’ part, it is rolling out a craft beverage option on its soda fountain with the help of a panel of millennial shoppers who revealed the flavors they’d like to see most.
5. … to grow market basket
Shoppers spend $6.13 on average with fountain drink purchases, adding up to almost $30 per shopper per month, according to new data from Whirley DrinkWorks! and the NACS Shopper Panel.
6. A natural trend, naturally
Natural and organic is a $114 billion growth industry—and c-stores are a driver of that growth, believe it or not. Convenience stores outpace many other channels in natural and organic snacks. According to data from SPINS, natural-snack sales are growing seven times faster than conventional ones.
7. The convenience factor
Consumer packaged goods (CPG) manufacturers owe a growing piece of their success to convenience stores. According to Larry Levin, executive vice president of business development for IRI, 35% of all CPG growth has come from c-stores, equating to about $4 billion. C-store CPG grew 2.8% in 2016, while all CPG grew 1.4%, he said.
8. Traffic drivers
Lee Barnes, head of data insights for Paytronix, said retailers should pay attention to how often customers who use their loyalty programs come into their stores, and react accordingly. With low-frequency customers, a retailer’s goal should be to get them to do more of the same; if they come in for coffee once a week, try to get them to come in for coffee three times a week. With high-frequency people, try to get them to do something different; if they come in every day for coffee, try to get them to add a muffin.
9. Innovate and mutate
With its latest innovations—a soda called Mutant, an enhanced water dubbed Hydro and, coming soon, a Frappuccino-like coffee drink—Monster Beverage has one primary goal in mind: to grow sales during day-parts outside of the morning rush, said Dean Zurliene, director of category management of small store for Monster Energy.
10. Nutty trend
Hazelnut is the next big flavor for Snickers, according to Tim Quinn, vice president of trade development for Mars Wrigley, with the pending debut of a caramel version as one of the company’s biggest launches.
11. Pump up the volume
Volume sales of beer in convenience stores were flat in 2016, driving many retailers and suppliers to trade consumers up to improve dollar sales, according to Joseph Kaczynski, national category manager—convenience and military for Boston Beer Co. "In a time of flat category performance, it is important to understand what can be done to drive dollar sales," he said. "If I can get people to to buy better beer, that's going to grow dollars." And it seems to be working: Volume sales of domestic superpremium beer grew 7.2% in 2016, according to IRI, while craft beers grew 7.9% and imported beers 11.1%.