How can convenience stores improve their loyalty programs, retain employees and better understand the nicotine consumer?
Experts at CSP’s Convenience Retailing University shared insights on these topics and more during the three-day event in Nashville, Tennessee.
Give Consumers What They Already Know: Games
Convenience-store consumers are already playing mobile games, said Mike Templeton, partner at NexChapter, during a session during CRU, such as puzzle, social media, card, casino, board games and more.
Integrating gamification into loyalty is a “game changer,” Templeton said. Adding games into a loyalty program drives app frequency, and real-time rewards is what consumers are used to, he said.
Pervez Pir, president of retail at Loop Neighborhood Market, said that if you have employees engage with the games, they are better equipped and likely to talk to the customer about it, show them how it works and be an advocate. Loop has an employee hub, where 84% of employees have downloaded the chain’s app and have played the game in the last 30 days.
Labor Retention Is Tied to Employee Experience, Customer Experience
The top reason why front-line convenience-store employees quit their jobs is because of negative employee experience, said Matt Riezman, partner at NexChapter, a consulting for convenience stores based in Des Moines, Iowa. There are 1.3 million more retail jobs in the United States than people looking for this type of work monthly, according to Federal Reserve data, but creating a better employee experience could turn this around, Riezman said. In turn, 42% of retailers who have top quartile employee experience scores also have top quartile customer experience scores, according to a McKinsey study, so it’s a win-win.
Riezman talked through several examples of technology solutions that could improve the employee experience, including predictive scheduling. Managers inputs business data—historic sales, competitive data, weather, and more—and employee data—when they want to work, what they are trained on, their preferences and more—into the system. Then, it generates a schedule that managers would review it before sharing it with employees.
Employees benefit from a predictable schedule and workload, and managers benefits from less time scheduling. Plus, if the right amount of labor is in the store more of the day, that’s fewer lines to wait in, more shelves that have items on them and a better customer experience, Riezman said.
Don’t Discount Too Much
You can get only so many burgers in a bag for a certain low price. Billy Colemire, vice president of marketing and brand at Boise, Idaho-based Stinker Stores, warned of excessive price discounts, which can devalue a product.
“You don’t want to be known as cheap,” Colemire said. “That’s a negative connotation.” Dropping prices for a limited-time offer is one thing, he said, but “those deep, deep discounts are not sustainable.”
Colemire said he’s seeing a lot of combo offers and “very price-driven discounting right now” from quick-service restaurant (QSR) and c-store competitors. But for Stinker Stores, “We’ve tried to make sure that the value to us is not always price; it’s the value that we offer, it’s having that one-stop shop in our app and CPG (consumer packaged goods) offers and working with a lot of those partners.”
Colemire said Stinker is paying attention to combo offers, “But we can’t erode margin forever, so rather than trying to beat the QSRs on the combo—that’s a little difficult based on the scale, we have 105 scores—it’s more of being innovative now. They’re not going to be able to do these combos for three to four years from now, so how can you continue to differentiate yourself from the QSRs.”
Nicotine Pouch Insights
Product quality and nicotine strength are top drivers for picking a nicotine pouch brand, said Waqas Khan, global CEO of smokeless nicotine alternative Clew Pouches, Delaware, Oklahoma.
Speaking on the New Vision of Nicotine, Khan explained the evolution of nicotine consumption, highlighting the industry's transition from traditional tobacco products to next-generation alternatives like modern oral pouches.
He said that 83% of nicotine pouch consumers use the product because of its convenience and that 53% use nicotine pouches because it is a safer alternative.
When it comes to consumer usage, Khan said that 53% use nicotine pouches to replace smoking and vaping.
C-Store Foodservice Outpacing QSR
C-store foodservice is outpacing QSR. That's according to data shared at CRU Tuesday by Donna Hood Crecca (pictured above), a principal with CSP's sister research firm, Technomic. Convenience-store foodservice is forecast to grow 5.7% this year, while fast-food growth is predicted to be just 4.7%.
"When foodservice is really well executed, the category has the ability to drive frequency, to drive basket size, to drive the top line, and the bottom line just continues to grow," Hood Crecca said. "And what this means is that foodservice is incredibly important to the health of the overall business."
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.