OAKBROOK TERRACE, Ill. -- Consumer demand for more specialty blends, a more upscale experience and a plethora of flavors and “mix-ins” to dress up their cups of java is creating excitement in the coffee category across all channels. Convenience stores—from independents to large chains—can capitalize on these trends on a variety of levels.
According to Anne Mills, manager, consumer insights for Chicago-based research firm Technomic, c-store coffee sales are strong because menu development around premium and specialty coffee products has been ongoing for the past couple of years.
“C-stores are now hotly competitive within their own segment, as well as with LSRs (limited-service restaurants), with their coffee menus,” she said. “We’re seeing c-stores upgrade the quality of their coffee, offering higher-end blends and creating made-to-order coffee bars where drinks are freshly prepared from scratch.”
Mills said top trends include:
- Dessert-inspired specialty coffees (including chocolate, berry, caramel, pecan, praline, peppermint, tiramisu, doughnut and many other flavors) with specialized prep methods that increasingly reflect seasonal tastes
- Dark-roast coffee blends
- Coffee bundled with breakfast sandwiches for a low price
- Premium or sustainably sourced blends.
For convenience retailers, these trends mean it’s time to step up their coffee game—or get out of the game altogether. “Convenience-store coffee is not the coffee of five or 10 years ago,” said Sharon Kuncl of distributor Eby-Brown, Naperville, Ill. “Today, when a consumer walks into a c-store, they expect a quality experience and product.”
In fact, 46% of c-store operators see regular coffee as the beverage with the most growth potential, as opposed to only 8% of QSR/fast-casual operators, according to CSP magazine’s 2015 Foodservice Handbook. However, 37% of the restaurateurs indicated that made-to-order specialty coffee drinks have the highest sales growth potential, compared to 19% of c-stores.
Quality & Freshness
Darren Tristano, executive vice president for Technomic, said a c-store’s coffee program is a critical part of its foodservice operations, especially from breakfast through late morning. “Flavor, taste and temperature are all important elements of a strong coffee program if you want to attract repeat customers,” he said.
Kuncl advises her retail customers not to skimp on the quality of their coffee.
“A pitfall is when retailers try to save money by purchasing a cheap blend of coffee or brew at the wrong throw weight,” she said. “The problem is that cup of coffee is not what today’s discerning consumer is expecting. If you want that consumer to come back, you need to brew a quality cup consistently. We are creatures of habit, and we expect the same quality and taste every time.”
While Kuncl thinks c-stores can provide a cup of coffee that competes with the Starbucks or Dunkin Donuts of the world, she said they can really stand out by offering something no other QSR, cafe or doughnut shop can offer—mixology.
“That’s what we call the ultimate experience, where the consumer gets a great cup of coffee and mixes in what they want,” she said. “They can have the same cup every day, or they can use a different assortment of accompaniments to create a unique taste experience.”
Another must-have for a c-store coffee program that seems obvious is cleanliness.
“Consumers like to see a store employee working around that area to keep that pot of coffee fresh and continuously brewed,” Kuncl said. “If it’s dirty and cluttered, they won’t want to come back.”
In fact, Tristano said a lack of cleanliness remains the No. 1 reason consumers don’t visit a store more frequently.
The flow of the coffee area is also important to consumers, Kuncl said: where the cups are, the accompaniments, the garbage can, etc. Everything must flow so it’s not a chore to find what the consumer needs.
Down the Road
Moving forward, Tristano would like to see more stores offer creative combos, such as a cup of coffee and a sandwich. “The pairing doesn’t have to be breakfast oriented; it can be a roller dog,” he said. “It’s not as much about the combination as it is the price point.”
What about stores that lack a full-fledged foodservice operation? Tristano said retailers can offer a variety of items, from packaged snack or bakery items to freshly made doughnuts (local offerings are growing in popularity).
Overall, the coffee opportunity for c-stores is a strong one. “The enhancements c-stores are making regarding their coffee program seem to be paying off,” Mills said. “Our research [April 2015 survey] indicates c-store consumers are purchasing more coffee from convenience stores now than they were a year ago; 58% purchase coffee beverages from c-stores at least once a week, up from 53% in 2014.”
This post is sponsored by Curtis Coffee and Specialty Beverage Equipment