CSP Magazine

General Merchandise: Prepaid & Financial Services 2015

Retailer Averages

Year-end 2014

To provide a helpful benchmarking tool for the prepaid and financial-services category, InComm, an Atlanta-based distributor of stored-value and prepaid products, shared the following average daily revenue figures (ADR) for c-stores and grocery stores. The retailers are split into three groups: best in class, middle of the road and those who have room for improvement. The ADRs below cover the segments of wireless (prepaid mobile top-ups), long distance, financial services (including open-loop and general purpose reloadable cards), as well as gaming and music products.

C-Store Sample: Prepaid & Financial Services ADRs*

RetailerStore countWireless ADRLong-distance ADRFinancial services ADRClosed-loopContent (gaming/music)Total ADR sales
BEST IN CLASS       
Retailer A400+$65.85$1.93$253.28--$22.38$343.51
Retailer B0-199$63.57$0.95$160.02$8.25$14.02$246.81
Retailer C400+$69.00$1.25$108.25$30.87$32.00$241.37
Retailer D400+$56.01$0.76$98.60$5.83$7.79$168.99
Retailer E200-399$50.27$1.18$101.74$1.95$0.49$155.63
        
MIDDLE OF THE ROAD       
Retailer F400+$47.56$1.05$59.63$16.01$10.07$134.32
Retailer G0-199$36.52$0.51$44.51$13.12$13.06$107.72
Retailer H0-199$39.40$0.19$44.17$0.92$0.75$85.43
Retailer I400+$38.73$3.00$22.01$0.11$0.74$64.59
Retailer J400+$32.21$0.43$26.38$0.93$0.21$60.16
Retailer K0-199$42.89$0.29$12.91$1.68--$57.77
Retailer L400+$30.19$0.44$23.63$0.52$1.54$56.32
Retailer M200-399$28.39$0.15$24.17$0.43$0.07$53.21
Retailer N400+$12.10$0.84$37.54$1.18$0.03$51.69
        
ROOM FOR IMPROVEMENT       
Retailer O400+$3.17$0.13$28.50$11.94$5.07$48.81
Retailer P0-199$18.79$0.19$11.53$1.00--$31.51
Retailer Q400+$26.29$0.11$3.49$1.26$0.30$31.45
Retailer R200-399$22.39$0.26$8.06$0.51$0.08$31.30
Retailer S200-399$21.66$0.19$1.84$0.72$0.31$24.72
Retailer T0-199$12.88$0.33----$3.31$16.52
Retailer U200-399$1.33$0.39$0.35$0.01--$1.88

Source: InComm

* Average daily revenue


Consumer in Focus

According to 2014 research by Packaged Facts, 13.8% of adults use prepaid cards. Of these, more than half—or 51%—also used a debit card and a credit card. Meanwhile, only 10% had only the prepaid card. “This suggests that, for many prepaid users, prepaid cards function as a complement to debit and credit cards—not a  replacement,” the research firm says. “To drive prepaid usage and usage frequency among these users, the industry will need to continue to develop mobile-forward strategies and add more robust features and benefits, which may help wean them from other card options.”

CONTINUED: Grocery Sample, Lottery & ATM

Grocery Sample: Prepaid & Financial Services ADRs*

RetailerStore countWireless ADRLong-distance ADRFinancial services ADRClosed-loopContent (gaming/music)Total ADR sales
BEST IN CLASS       
Retailer 1200-399$75.53$4.37$581.55$484.27$123.52$1,269.24
Retailer 20-199$44.31$1.31$136.00$162.69$48.71$393.02
Retailer 3200-399$21.91$0.76$120.32$196.93$33.47$373.39
Retailer 50-199$58.23$0.62$238.04$26.17$0.21$323.27
Retailer 60-199$54.03$0.82$143.58$104.10$17.34$319.87
        
MIDDLE OF THE ROAD       
Retailer 110-199$26.74$2.01$91.71$69.95$19.55$209.96
Retailer 120-199$27.09$0.55$101.10$54.31$14.53$197.58
Retailer 13200-399$11.01$0.44$98.29$52.18$13.67$177.28
Retailer 140-199$15.60$0.97$81.15$49.51$9.03$156.26
Retailer 160-199$11.17$6.96$34.62$37.80$22.19$112.74
        
ROOM FOR IMPROVEMENT       
Retailer 250-199$12.61$0.32$43.26$17.73$5.31$79.23
Retailer 260-199$9.83$0.93$41.37$17.86$0.14$70.13
Retailer 270-199$0.77--$26.10$29.74$3.02$59.63
Retailer 290-199$8.26$0.64$18.46$10.22--$37.58
Retailer 300-199$6.04$0.41$17.77$11.67$0.66$36.55
Retailer 340-199$20.67$1.53$5.05$3.40--$30.65

Source: InComm

* Average daily revenue


Consumer in Focus

According to Scientific Games Corp., a provider of gaming products and services to lotteries, lottery customers spend 70% more on in-store purchases than non-lottery customers, with an average of $13 in non-lottery purchases per visit. They are also 90% more likely to buy cigarettes, 73% more likely to buy beer and 54% more likely to buy candy than customers who do not make a lottery purchase.

CONTINUED: Lottery Sales & ATM

C-store/Gas Station Lottery Sales

C-stores and c-stores with gas reaped 62% of lottery sales and 62% of commissions in fiscal year 2013, totaling $2.3 billion, according to industry data provider La Fleur.

Lottery typeFiscal year 2013 sales ($ millions)Channel share
Scatch sales$20,581.367%
Draw sales$12,096.655%
Total sales$32,677.962%

Source: La Fleur/TLF Publications Inc.


Lottery Sales by State

Fiscal year 2013

What follows is a breakout of c-store and gas station lottery sales by state for the most recent fiscal year, according to La Fleur. The sales dollar figures include both draw games—Pick 3, Pick 4, Mega Millions, Powerball—and scratch-off instant games.

StateC-store agentsFiscal year 2013 sales ($ millions)Gas c-store agentsFiscal year 2013 sales ($ millions)
Arizona2,042$457.2143$10.5
Arkansas529$92.3898$268.0
California2,774$804.36,278$1,156.3
Colorado1,668$377.20$0.0
Connecticut1,078$448.7839$362.8
Delaware63$18.6198$52.8
D.C.91$35.660$31.3
Florida2,784$838.66,545$2,420.7
Georgia2,467$1,263.23,922$2,113.4
Idaho43$5.5596$125.5
Illinois1,013$450.83,562$1,360.2
Indiana212$40.02,582$684.8
Kansas41$4.31,038$189.3
Kentucky105$34.11,877$622.6
Louisiana247$29.72,148$367.1
Maryland810$402.11,097$470.1
Massachusetts2,818$2,523.71,237$714.8
Michigan1,062$257.83,556$794.0
Minnesota296$49.41,789$395.0
Missouri305$48.02,532$774.2
Montana0$0.0404$36.0
Nebraska14$0.8792$123.0
New Hampshire292$56.8558$147.1
New Mexico51$3.8860$109.5
New York4,848$2,157.0414$147.5
North Carolina806$166.54,394$1,310.3
North Dakota3$0.2324$20.7
Ohio1,341$527.13,201$971.9
Oklahoma115$6.71,613$184.8
Oregon801$105.1421$36.8
Pennsylvania891$391.63,035$1,486.6
Rhode Island236$65.7261$66.3
South Carolina445$97.92,621$984.8
South Dakota466$43.90$0.0
Texas2,319$513.510,726$3,143.9
Vermont77$9.8435$72.9
Virginia1,033$334.53,238$1,029.2
Washington796$97.41,797$234.3
West Virginia113$5.9998$57.1
Wisconsin0$0.02,632$436.2
Total35,095$12,765.279,621$23,512.5

Source: La Fleur/TLF Publications Inc.

CONTINUED: ATM Use

The ATM Consumer and C-Stores

Research by Mercator Advisory Group, an advisory firm to the payments and banking industry, reveals there is an upward trend in ATM usage. Consumers are using ATMs more frequently and doing so at a wider variety of ATMs. When asked which ATMs they use, consumers reported a significant rise in usage of their bank’s ATMs at in-store locations, growing from 21% of ATM users in 2011 to 29% in 2014.

Young adults and mobile-banking users who use ATMs are more likely than average to use a wider variety of ATM locations, including their banks’ ATMs in store locations (38% of mobile-banking users and young adults vs. 29% average), according to Mercator. The greatest growth for these users was seen among other bank or non-bank-branded ATMs in store locations (27% of mobile-banking users and young adults vs. 19% average, up from 17% of mobile-banking users and 16% of young adults vs. 11% average who used other banks’ or non-bank-branded ATMs in store locations in 2013.)



Which types of ATMs do you use?

My bank’s ATM (net)93%
My bank’s ATM at their branches74%
My bank’s drive-thru ATMs48%
My bank’s ATMs in store locations29%
My bank’s ATMs in other non-branch locations19%
ATMs from banks I don’t do business with (net)25%
ATMs at bank branches other than the banks I do business with14%
From banks I don’t do business with, in store locations13%
ATMs from banks I don’t do business with, in other non-branch locations10%
Not bank-branded ATMs (net)16%
Not bank-branded ATMs in other convenient locations11%
Not bank-branded in store locations12%
ATMs in hotels, airports or other travel locations (net)9%
Other ATMs (net)3%

Sources: Mercator Advisory Group, Cardtronics Inc.


The C-Store ATM User

According to research by The NPD Group, ATM users are loyal to the convenience stores where they access their cash. They’re more likely than non-ATM users to always visit the same store and to be heavy shoppers. They also spend significantly more per visit and buy more items while there.

LoyaltyAlways shop one c-storeShop 2-3 storesShop many stores
ATM user42.0%39.3%18.7%
Channel average29.8%50.0%2-.2%

Source: The NPD Group

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