Gas prices have climbed back to nearly $4.50 per gallon, once again placing pressure on convenience retailers as the industry heads into the summer driving season. While prices remain below the historic highs of 2022, renewed volatility is already reshaping driver behavior. For operators, the risk extends beyond fuel margins, and rising prices threaten inside traffic, basket size and the ability to convert fuel stops into profitable visits.
Fuel occupies a unique place in consumer psychology. Prices are universally visible, instantly comparable and highly emotional, influencing not just where drivers stop, but whether they engage beyond the pump. Even small price differences can override preferences for food, cleanliness or brand familiarity. In those moments, fuel becomes an emotional currency, and retailers who fail to account for its risk losing both the fuel transaction and the in-store opportunity attached to it.
That reality presents a clear challenge, as most convenience store profitability is driven inside the store rather than at the pump. PDI data shows the average U.S. driver visits a gas station four to six times per month, with 40% stopping at least twice a week. When fuel prices rise and consumers become more cautious with spending, trips may persist, but discretionary purchases often do not. The critical question becomes how to protect inside engagement when fuel dominates the visit.
The industry faced this exact scenario in 2022. Research from Ipsos found that 70% of consumers drove less as prices spiked, while nearly half partially filled their tanks to manage costs. The National Association of Convenience Stores (NACS) reported that close to 60% of retailers saw average basket size decline among shoppers who did come inside. The pressure was real, but the response offers valuable lessons.
Rather than relying on blanket price cuts, many brands turned to loyalty programs as a stabilizing mechanism. Three approaches emerged. First, fuel discounts tied to app usage or payment method helped lower the perceived price of gas while pulling customers into loyalty ecosystems. Second, retailers linked fuel savings to in-store purchases, reinforcing food service and high-margin categories. Finally, some operators separated incentives from fuel entirely, investing in in-store rewards and experience to build habit and brand preference regardless of fuel volatility.
Despite reduced fuel consumption during peak summer months, 2022 became a record year for in-store performance. Average baskets surpassed $7.50, foodservice grew to roughly 25% of in-store sales and more than a third of gross margin, and brands that invested in experience emerged stronger.
Those lessons are directly applicable today. Operators should plan for continued volatility and treat fuel value as both a defensive and offensive loyalty lever. Clearly communicating fuel savings tied to loyalty membership can help anchor emotionally driven decisions without permanently eroding margin. Short-term, high-visibility sign-up incentives like limited-time fuel discounts or beverage offers can accelerate acquisition during periods of heightened price sensitivity.
At the same time, retailers should expand focus beyond fuel. Targeted incentives that introduce customers to underutilized profit centers like foodservice, beverages, car wash and tobacco allow operators to protect margin while driving behavioral change. Loyalty programs are particularly effective here, enabling personalization at a time when broad discounting is least sustainable.
Periods of price instability tend to reveal what customers value most. Rising gas prices sharpen tradeoffs and concentrate attention. The brands that emerge healthiest are those that recognize these moments not as a margin crisis, but as an opportunity—to listen more closely, respond with purpose and position loyalty as a partnership rather than a promotion.
Donald Fairbanks is a senior loyalty strategist on the strategy services team at Paytronix, the guest engagement company. In this capacity, he helps convenience brands leverage smart solutions that lead to innovation, evolution and bottom-line growth. He can be reached at dfairbanks@theaccessgroup.com
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