Convenience-store operators have a tremendous opportunity, and it’s hiding in an often-neglected item: the humble cup of coffee.
Consumers have become savvy coffee drinkers in recent years. They’re educated, and they’re particular about beans, brew strength and condiments. That often means they’ll gas up at c-store pumps, then jump back in their cars to hit a QSR for fresh, quality coffee.
But c-store operators can capture those lost customers by building a complete quality coffee program.
“We have a more sophisticated coffee consumer today,” said Cynthia Hswe, vice president of marketing for Portland, Ore.-based Boyd’s Coffee. “They’re not just expecting brown water.”
Jon Bratta, Core-Mark International’s vice president of marketing, agreed with Hswe’s assessment.
“Today’s coffee consumer, particularly the millennial, is looking for much more than just a ‘cup of joe,’ ” Bratta said. “They care about many things that coffee consumers in the past were not particularly concerned about. They care about the types of beans, where they were grown, how they were grown. Do the growers use sustainable farming practices? Is the product organic? Is the process for decaffeinating beans free of chemicals? All of those things come into play in some way for today’s coffee consumer, and as a coffee supplier to our retail customers, those things have to be top of mind as we continually evolve our program to meet the needs of our customers and, most importantly, their consumers.”
Hot beverages account for 30% of total c-store foodservice sales, and consumers purchase brewed or specialty coffee more than any other hot drink, according to Technomic data.
Taking the time to develop a quality coffee offering will drive consumers into the store (where they’ll likely purchase other items).
Often, a small investment in coffee quality can pay off in a big way in terms of profit, customer loyalty and engagement.
SOCO Group, a c-store chain in Southern California, recently upgraded its coffee program with rebranding, expanded variety, increased brew weight and a refreshed coffee counter design, said Toby Garber, the chain’s retail manager. The changes have increased customer satisfaction and appear to be driving new business.
“We quickly saw an increase in overall coffee sales,” Garber said. “Our flavored coffees and other products that go with coffee increased as well. … We saw an immediate, positive response from our customers who described the coffee as having a richer, bolder flavor.”
Adding a bit more coffee to the brew, to develop a richer flavor and fuller mouth feel enhances consumer satisfaction, said Richard Hunt, corporate director of fresh and foodservice for Core-Mark.
Increasing the “drop size,” or affectomg the coffee-to-water ratio, makes for a better-tasting cup. Also important to today’s savvy consumers is an engaging narrative about the coffee’s origins, along with customized roast offerings.
“Offer different types of blends that appeal to your consumer,” Hswe said. “These can be regionalized. For these national c-store operators, we highly recommend different roast levels. The East Coast likes a lighter roast. The West Coast likes a darker roast.”
Coffee drinkers, especially those in the coveted 18-to-35 demographic, are also looking for fresh, higher-end condiments and flavorings. Consider fresh creamers and nondairy alternatives, rather than shelf-stable options.
The key words to focus on are “authentic,” “fresh” and “quality,” Hswe said.
“You can’t just put ‘fresh’ on a billboard or on a poster,” she said. “You have to show a real, genuine commitment to freshness,” such as offering a money-back guarantee or providing consumer education that each pot is brewed fresh every hour.
Once an operator has established a quality hot-brewed coffee program, the store can consider expanding into iced coffee or the on-trend technique of nitro coffee. (Countertop nitro coffee taps are expected to come online in the next months.)
Also, the coffee station must be well-organized and in a bright, easily accessible area of the store. Also, staff must be educated on how to brew quality coffee and how to intelligently speak to consumers about the store’s offerings.
“We all really need to up our game and continue to evolve to effectively compete for today’s coffee consumer,” Bratta said. “We see many out-of-channel competitors either emerging or improving their coffee offers to steal share from convenience. To continue to effectively compete, we need to continue to improve our customer offers, our locations’ image and appeal, and how we are serving every customer that comes through our doors to buy food or a beverage in our channel."
This post is sponsored by Core-Mark