CSP Magazine

What Consumers Want; And Will They Want You?

What the convenience channel must achieve to win today’s increasingly demanding consumer

If you plan to stay the same, you’re making a big mistake.

The exclusive CSP-Technomic report “Future-Focused: Next-Level Convenience Retailing” shows change is vital if you wish to compete in an increasingly crowded marketplace in which customer loyalty is rare and options are legion.

If there is a common thread in customers’ desires, it is this: choices.

Consumers want variety, whether it’s more flavors at the fountain or coffee bar, made-to-order food or fresh grab and go.

They seek a greater selection across tobacco segments, including cigarettes. And the customer wants your stores to be cleaner and bigger, such as the 6,000- and 7,000-square-foot formats being rolled out by the likes of CST Brands, Sheetz, QuickChek and RaceTrac.

Put simply, if you’re planning another 2,000-square-foot box offering traditional fare, don’t waste your money. If your store isn’t authentic or your brand is not unique, sell now—the future of this industry is not for you.

But don’t fret: There is some good news. Customers are not asking you to build costly behemoths that may look glitzy but risk being excessive or faddish.

They want you to evolve, to embrace freshness, cleanliness, healthy, mobile, loyalty and value. They want you to be better. They want you to be their friend.

Our exclusive report, conducted with Chicago-based Technomic Inc., plumbs the thoughts of 1,500 nationally representative c-store shoppers 16 and older, who participated in an online survey in August 2014.

They are the pimpled teen and the not-yet-retired baby boomer. They are the suburbanite mom of three in Jacksonville and the young male strolling the streets of Philadelphia.

They are your past and present. And they will determine your future.

There is much to digest, but here are some key insights:

Assortment: Customers want choices. They want you to welcome the diesel driver, the vaping millennial, the breakfast bundler.

Ignore Hyperbole: It’s no secret that cigarette use is declining, but it would be foolhardy to dispose of the channel’s No. 1 item.

Fresh and Healthy: Menus and palates vary, but if you have not yet invested in fresh sandwiches, soups and healthy snacks, you are rapidly on your way toward irrelevance.

Day-parts: There’s a lot of opportunity in morning and evening hours. Think about how to use the afternoon with promo opportunities to drive traffic in non-peak hours.

The data is dense but we’ve distilled it for you in digestible, actionable nuggets. In addition to this exclusive report, we are running a special, extended online series in CSP Daily News (cspnet.com) that promises fresh growth opportunities and strategies.

We hope this report pushes you to think about how you can further engage millennials and Generation Z while also surprising your baby boomers and Gen-Xers.

CONTINUED: Know Your Customers

Know Your Customers

How well does your c-store brand resonate with shoppers?

We all need to be cognizant of brand image and need to cultivate the brand we want,” says Joe Sheetz, president and CEO of the uber-branded chain Sheetz Inc.

“We all need to segment and target specific customer groups and do a great job serving their specific needs,” he says. “Mass marketing does not seem to be relevant anymore.”

Like guests at a holiday table, your customers each have different experiences and expectations. If you want to wow them, you need to get the offer and delivery right by race, ethnicity, age, income and gender.

There is also time—the 24 hours to a day. Our research shows that those who shop your store in the morning are not necessarily returning in the afternoon or at night. Likewise, that midday snacker may be oblivious to your breakfast offering or a dinner promotion.

And, of course, there’s frequency. Not only do we care about who’s shopping in the store and when, but also how often.

How do we integrate data from so many charts and distinctive questions to create a customer segment and strategy for that customer type? We embrace some of the classic one-word questions found in every journalist’s lexicon: who, what and when.

Who

Let’s take millennials, the group representing ages 22 to 37. Millennials are a potential gold mine for you. Fifty percent meet our definition of “super-heavy users,” meaning they shop in c-stores at least four times a week.

What

Look at purchase behavior and you’ll find some surprises. Perhaps expected, millennials index very high for food and beverages. They weren’t raised with the “not-in-my-c-store” mentality when it comes to filling their belly. If your food is fresh and tasty, they’ll buy it.

And there’s something else they may buy: tobacco. This could mean cigarettes, moist smokeless or, perhaps more likely, e-cigarettes and vaping products.

When

Millennials love the night when it comes to day-parts. Nearly 60% of the convenience millennial shopper frequents the store after 5 p.m.

What is the opportunity from all of this? Covet your millennial customer. Make sure your foodservice and fountain programs are exceeding this segment’s expectations. Offer nighttime specials and keep on top of tobacco trends to be early to market with the latest in products, from smokes to so-called “cig-alikes.”

This is the easy stuff. Expand their habits by meeting them where they are and stretching them to new opportunities. Incent the nighttime diner to come in the following morning for a free coffee or muffin. Create some day-part offerings, even a day-part loyalty program.

Do you know your shopper segments? Do you, as Joe Sheetz suggests, target specific customer groups?—M.M.


One in Three

Just more than one-third of consumers polled by Technomic for the report say they look forward to visiting their favorite c-store. This number skews higher for Gen Z and millennials but lower for baby boomers and “matures,” those 69 and older. Other groups who eagerly anticipate their next visit: morning shoppers, tobacco customers and, of course, “super-heavy users,” who visit the store four or more times per week. These high-frequency customers tend to be male, skew millennial and are more likely than average to visit the store in the morning day-part.

Click here to view more customer data.

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