After filling countless stockings and delivering billions of presents the night before, Santa takes a well-deserved rest Dec. 25—as do most merchants.
But the one retailer you can count on remaining open is your friendly neighborhood convenience store. Where else can you slog for eggnog, a last-minute gift card or party snack on Christmas Day?
Scoffers may snicker at the thought, but convenience stores fill an important niche for those 11th-hour shoppers, mall-averse procrastinators and time-starved on-the-goers.
In fact, a NACS survey published last December suggests consumers aren’t just going to Toys R Us or Walmart for their holiday wares.
Survey respondents shared that they would buy gift cards (23% of respondents) and small presents or stocking stuffers (21%) more often from c-stores.
And that begs an important question: If you aren’t offering at least a few under-the-tree options for patrons to choose from, what are you waiting for?
“Consider that 83% of what is sold inside a c-store is an impulse purchase,” says Jeff Lenard, NACS’ vice president of strategic industry initiatives. “Whether they’re out shopping on Black Friday or Dec. 24, consumers can do an awful lot of purchasing at c-stores that demonstrate a little creativity and present themselves as a shopping destination.”
Christmas Plus Convenience
Kyle Sloan, category manager for Love’s Travel Stops and Country Stores, Oklahoma City, says merchandising seasonal gifts builds consumer excitement for the category.
“We want to offer a new innovation or novelty you won’t see anywhere else—one that has the opportunity to add more dollars to our bottom line,” says Sloan, whose stores annually produce a holiday gifts sales flier. “What’s exciting about offering seasonal gifts at a c-store is that, despite our small footprint, customers can touch a larger portion of our location on each visit with items that drive greater foot traffic and impulse purchases.”
Among the hottest holiday items carried by more than 300 Love’s locations last year were retro toys, such as the original Rock ’Em Sock ’Em Robots ($19.99); nostalgic novelties such as a lifesize, official “Christmas Story” leg lamp ($119.99); and contemporary kids’ favorites such as Mattel Die-Cast Monster Jam gift packs ($12.99) and Fancy Puppies in a Purse ($5.99). This November, Love’s plans to begin carrying no-pedal balance bikes by Strider, priced at $119.99.
Love’s is hardly the only chain stocking wrap-ready wares. 7-Eleven locations late last holiday season featured remote-control toys, prepaid phones, video games, gift cards and used DVDs. It also provided prewrapped stocking stuffers such as an 11-function pocket knife with LED light, reusable pocket hand-warmers, and six-in-one screwdrivers, each priced at $7.99 or three for $20.
Remote-control Extreme Helicopters seem to fly off store shelves every fourth quarter at VERC c-stores, operator of 24 locations across Massachusetts and southern New Hampshire. Ranging from $29.99 to $99.99, these high-tech toys make great unplanned-purchase presents, says Courtney Vercollone, category manager for VERC Enterprises, Duxbury, Mass.
“Those are big rings for the register and among the highest-priced items we carry,” says Vercollone, who introduced Battle Robot Flyerz (tagged at $29.99) late last year due to popular demand for airborne playthings in her stores.
CONTINUED: A Sleigh Full of Opportunities
Sleigh Full of Opportunities
Gift ghosts of Christmas past included relics such as disposable cameras, VHS tapes and holiday-themed cigarette cartons adorned with bows and ribbons.
Those items have been replaced by high-tech baubles such as Bluetooth headsets, headphones and thumb drives.
In 2009, NACS published its top 10 c-store gift ideas: coffee, beverage refill mugs, gift cards, phone cards, lottery tickets, magazines, ice scrapers, batteries, chocolate and interactive candy. NACS’ Lenard suspects gift cards would place first today.
“Gift cards have become widely embraced by shoppers,” he says, “and convenience operators nowadays have the ability to sell cards for so many more specific consumer brands, as well as retail chains.”
Enticing price points for holiday gift shoppers typically range from $4.99 to $29.99, although smaller stocking stuffers often retail for less, according to Ray Johnson, operations manager for 20-store Speedee Mart, Las Vegas.
At Rutter’s Farm Stores, which has 56 locations in Pennsylvania, candy is the sweetest holiday-season seller. Dave Lau, merchandising manager for the York, Pa.-based chain, says one-pound packs of Hershey’s, Reese’s and Peppermint Patty, each retailing for $9.99, as well as giant-size and collectors’ tin Pez candies, priced $9.99 to $19.99, are customer favorites.
“Holiday gifts are not a big focus for our stores, but we do really well with aggressively merchandising candies,” says Lau. “We don’t sell any toys of significance, but we have carried $39.99 fake leather purses, marshmallow shooters from $14.99 and a selection of holiday-themed new DVDs priced from $4.99 to $7.99.”
Lau isn’t planning on expanding gift offerings in late 2014, but the DVD display in his stores will be upgraded to include newer titles priced as much as $9.99 each.
Dave Shoemaker, president of Shoemakers Travel Center, Lincoln, Neb., says lottery tickets have always been great stocking stuffers at his store, and remote-control trucks, erector sets, dolls and, most recently, “Duck Dynasty” merchandise have proven to be brisk sellers in the last two months of the year.
However, Lenard cautions retailers to differentiate trends from fads.
“Our channel tends to be positioned toward the end cycle of distributions for items with a shorter shelf life,” he says. “You want to choose gift items with more staying power, especially if you’re a smaller retailer.”
That means staying away from things such as pogs and Silly Bandz, he cautions: “Red flags should go off when you have a nontraditional distributor come into your store to sell you something they promise will fly off your shelves.”
Shoemaker recalls getting stuck with a hefty unsold supply of radio-controlled flying fish following a recent holiday season. In such straits, he advises, “Either promote it with something else, or lower your price and get rid of it.”
Tinsel-Time Tactics
When carrying popular products such as name-brand toys or CDs by top artists from The Beatles to Katy Perry, it’s OK to exercise some creativity, including bundling products into a value pack or promoting local flavors.
“Perhaps you can design a ‘Sleepover in a box’ for a tween daughter that includes a package of teen magazines and health-and-beauty items,” says Lenard. “Or you can partner with a local bakery to offer a paid ‘Doughnut of the month’ subscription.”
Also, stocking branded products can fuel seasonal sales. Think about the legendary Hess trucks: They’re so iconic that even when the company divested its retail network earlier this year, it made emphatically clear that the Hess trucks would remain a holiday staple.
“Whether it is toy trucks, T-shirts or hats,” Lenard says, “branded items can build strong brand identity and create an exclusive sale opportunity that is only provided at your stores, which creates a loyal, repeat customer.”
CONTINUED: Atmosphere Counts
Atmosphere Counts
It’s hard to imagine holiday shopping without festive—OK, corny—music and some meaningful Christmas displays.
“It’s all about making an attractive presentation,” says Sloan of Love’s. “I recommend dedicating a highly visible section of your store to seasonal items that can quickly catch the eye, which requires good signage.”
“Your best bet is to display something on the counter or near the register. We put our remote-control helicopters on a display rack on the floor near the register,” says Vercollone, who also suggests stocking higher-ticket toys, gadgets and other gifts behind the counter to prevent theft.
“We buy prepackaged kits for each of our stores that include hanging paper decorations and tinsel that we use to create visual interest related to the holidays,” she continues. “The décor goes up right after Thanksgiving. We’ve found that it increases excitement and sales.”
Lau of Rutter’s agrees: “We have our operators put stockings and decorations on our signs and displays to get the customer’s attention.”
So what are you waiting for? It seems these days that everyone is getting a jump on the holidays, and the notion of waiting until after Thanksgiving seems as old as last year’s turkey.
“Our stores start stocking holiday-themed candies right before Halloween,” a practice that leads to stronger sales, says Lau.
“You want to hit it before or as your competitors do it,” Vercollone says, pointing out that big-box types such as Walmart set up two months before Christmas.
Of course, be prepared—and well stocked—for last-minute shoppers.
“Most gift buyers at c-stores are men who wait till the last second or forget a present for someone. They panic and pick something up while they’re already in your store,” says Johnson of Speedee Mart. “Those two days before Christmas is when most of our stuff moves.”
You’re Not a Scrooge
Holiday gift merchandising isn’t a slamdunk for every convenience retailer.
Michael Doucette, director of purchasing and merchandising for South Paris, Maine-based C.N. Brown Co., which operates 80 Big Apple Food Stores in New England, doesn’t want to left holding the Santa bag Dec. 26.
“Over the years we have tried holiday goods, small stocking-stuffer items and other like items and found that what we have left over as unsold merchandise offsets the sales and profit gains we expected, and without drawing additional customers to any great degree,” says Doucette. “Many of our locations also are in smaller markets, and we compete with Walmart, Dollar General, Walgreens and Rite Aid, which make a living selling seasonal and gift items day in and day out.”
If you lack the time and resources to launch a seasonal holiday gift program, you can always turn the task over to an outside turnkey expert, which has been a successful strategy for Johnson.
“It’s hard for me to keep up with the latest and hottest toys, electronics and other gift products, so I have my vendor do most of the work for me,” he says.
After picking select gift items from a catalog, Johnson authorizes his supplier to ship the products to and merchandise them in his stores. The vendor sets up the displays and signage, then comes back right after Dec. 25 to remove them all.
“Most of this stuff is worthless to us the day after Christmas,” Johnson says. “If you’re doing this all yourself, you normally would try to discount your unsold stock well into the following February. That’s why I recommend partnering with an outside vendor, which is a must for small operators like me.”
CONTINUED: 5 Ways to 'Ring' In This Holiday Season
5 Ways to ‘Ring’ in this Holiday Season
Darren Schulte, vice president of membership for NATSO, offers these tips for growing holiday sales:
▶ Study your shoppers’ habits. For example, time-starved customers tend to purchase higher-ticket items.
▶ Shop your competition and try to stock gift merchandise that your rivals aren’t selling or on which they can’t beat your price.
▶ Be sure the item is well displayed in a highly visible location, with the price clearly marked.
▶ Provide bundled deals and discount promotions, such as buy one, get one free; or buy one, get the second for half price.
▶ Offer special limited-time promotions, such as a one-day sale before Black Friday.
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