CHICAGO — Fuel customer conversion rates—that is, retailers' success in getting gasoline customers to visit the connected convenience store—hit their lowest level in at least two years in February.
A February Technomic survey of convenience-store consumers shows 51% of fuel customers reported entering the c-store every time or nearly every time, according to Technomic's C-Store Market Brief.
“This is the lowest rate since I’ve been tracking this data,” said Technomic Principal Donna Hood Crecca during CSP’s C-Store Foodservice Forum in Chicago. Technomic is CSP’s Chicago-based sister research firm.
Surprisingly, Crecca said, the decline in customer conversion comes even as multiple measures show positive trends in the economy and consumer confidence. Specifically, she pointed to record-low unemployment rates, positive job creation, growing salaries and consumer confidence hitting a record-high index of 129.
“Consumers are, in general, feeling pretty good,” Crecca said at the Foodservice Forum. “When we see these types of positive indicators, typically we see strong growth for foodservice. Turns out for early 2019, we’re not seeing that. Traffic is softening.”
Multiple dynamics are at work in keeping foot traffic down, she said, including …
3. Increased competition from other channels
Dollar stores have emerged as significant competitors to c-stores, going after customers purchasing tobacco, alcohol and immediate consumables. Also, the grocery channel is looking to its store perimeter to provide convenience and offset contraction in the center of the store.
5. Better fuel economy
Hybrid vehicles are one factor, but so is improved mileage among vehicles once considered gas guzzlers.
“There’s not one reason; it’s myriad reasons,” Crecca said, “and it’s probably going to remain challenged for some time to come.”