I love this time of year. The weather starts to break, spring appears and soon the worst winter I’ve been through in my more than two decades in Chicago will be a distant memory. Also, hockey playoffs are in full swing. It helps that we have a team that is winning, but nothing beats the excitement of watching playoff hockey.
The great Wayne Gretzky once said, “You need to skate to where the puck is going, not where it has been.” I hear that saying more and more in the business world, and it rings true for our industry as well.
I know that by the time you read this, you’ve surely combed through our NACS State of the Industry Special Issue, which we released last month. I’m sure you’ve benchmarked your performance against the top-quartile companies, the top decile and the rest of the industry.
On the surface, in what has been the slowest recovery in history, our channel appears to be performing pretty well. But that is no surprise: We are a resilient, innovative group that always finds a way to win. Overall store count continues to climb, and is now at 151,000; inside sales were up 2.4% in 2013 to hit a new high of $204 billion. Those are numbers to be proud of.
However, it seems that every year we have categories under attack, and our analyst friend Walter Zimmermann predicts the end of the world as we know it. Then it also seems that every year a category or two gives us a much-needed boost, saving the day.
For years, foodservice has been the knight in shining armor at the summit. Of course, today it is still critical to our growth and success. Our No. 1 inside category, tobacco, has been under siege with regulations, taxation and continued decline in smokers for a long time. Just like foodservice, OTP has had the spotlight, and it’s still performing today. Now lots of attention is on the e-cig/vape revolution. Granted, it’s a small percentage of the overall tobacco category, but there is no denying it’s been a bright spot in our channel.
CSP Business Media, like the industry at large, benefits from these shining stars. So, like you, we’re cautious at first, then we partner with the leaders and enjoy the ride along with the rest of the industry. We all walked out of the summit with an overall good feeling about our future.
Well, things may be good today, but let’s not get too comfortable. If you start to look a little deeper into the data or the economy, or take a more critical look at our industry, we still have some lingering challenges, such as the changing shopper or the continual decline in fuel gallons. These might not be critical issues right now, but they may become so in the not-too-distant future. Although the unemployment rate is coming down, the reality is there are still a lot of people still out of work. That is also affecting the housing market, and we all know how important that labor force is to our industry.
Then you have the millennials, our next-generation customers (and current employees). There’s not an event or discussion I’ve been a part of lately in which this group doesn’t come up. This group presents one of our biggest challenges from the standpoint of shopping habits and employment. Millennials think, act and shop differently. In my own personal experience, I’ve found that they are not as crazed as my generation was about having their own cars. So on top of the changes we’re seeing in fuel economy, our gallons will continue to decline. We’d better have a plan to make up this loss in revenue and trip occasions.
They also are more socially conscious about the world in which they live, and more aware of what they put into their bodies. Social media is critical when it comes to communicating with them, and the opinions of their circle of “friends” are far more influential than other forms of media.
From a media standpoint, we need to figure out how to attract and engage this group to secure our next generation of readership. I certainly don’t have all the solutions right now, but you can bet that everyone at CSP is busy, thinking and planning and skating to where the puck is going, not where it is today.
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