Winsight’s 2017 Convenience Retailing Trends
Oct. 25, 2016CHICAGO -- In a year when convenience-store owners are walking a tightrope of slimmer gasoline margins and increasing competition, CSP editors and the Technomic data team put their heads together to consider where c-store retail might land in 2017.
Here are Winsight’s 2017 Convenience Retailing Trends ...
1. Global is local
Global is local. The industry is witnessing international players, such as Applegreen from Ireland, OXXO from Mexico and others from Central and South America, permeate U.S. borders. Meanwhile, Circle K is branching out into the rest of the world from its North American base, and 7-Eleven’s parent company is setting aggressive goals for its already-massive U.S. footprint. Expect the globalization movement to lead to unique retail innovation, as well as distinct challenges in attracting the foreign consumer.
2. Big data gets predictive
Big data gets predictive. Retailers and manufacturers alike will begin to get smarter about the vast pools of data at their fingertips, using it to forecast what will sell, when it will sell, to whom and exactly how much. It’s a practice already at work by retail and consumer packaged goods (CPG) giants, and one that will soon trickle down to bleeding-edge c-store retailers.
3. Services 2.0
Services 2.0. Conventional c-store service amenities such as prepaid phone cards and check cashing have made room for newer services that reflect greater retail disruption. Storage lockers, online ordering and product pickups for e-commerce purchases, key making, in-store bill pay and at-the-pump ordering are now in play at c-stores, which will increasingly employ new, unheard-of service platforms to get consumers out of their homes and into stores.
4. Tailor-made stores
Tailor-made stores. Convenience stores are forgoing one-size-fits-all store prototypes in favor of strategic designs that connect and cater directly to the local market. This effort to fine-tune store identity will result in more tactical planning to highlight specific attributes, such as fuel-free, food-focused locations in areas with heavy foot traffic or multipump, large flagships off highways and in suburbs.
5. Balancing the c-store diet
Balancing the c-store diet. Despite a reputation for offering sugary and salty treats, c-stores are now embracing a better balance between health and indulgence to help meet the evolving demand for nutritional products without alienating core consumers. Look for candy bars, baked goods and fried hand-helds to be harmoniously positioned beside salad bars, nuts, fruits and packaged beverages that feature probiotics and protein.
6. Brand incubators
Brand incubators. CPG companies prominent in the c-store space—including General Mills, Coca-Cola and Campbell’s—are investing in smaller CPGs in a big way. Most recently, Chobani launched its Chobani Food Incubator, a program developed to support emerging companies with “attitude and aspiration” as they participate in an overall “food revolution.” What does it mean to c-stores? These investments will make available a more diverse range of products that more quickly respond to consumer demands.
7. Creative retention practices
Creative retention practices. To stem the rising tide of employee turnover, leading c-stores such as Kwik Trip, QuikTrip and Sheetz are using imaginative measures to keep their employees on the clock and happy. Both Kwik Trip and Sheetz opened a health clinic for their employees. QuikTrip employees can also receive tuition reimbursement and, after a certain amount of years, a paid sabbatical. The trend is a necessary one: As the labor pool gets tighter, convenience stores will need to do more than compensate to keep workers on board.
8. Consolidation nation
Consolidation nation. The big fish used to just eat the little ones. But today, more large companies are swallowing up other big names. In retail, large, publicly traded companies are purchasing other store-heavy enterprises to extend their reach, boost their scale and improve their business intelligence. Expect ongoing consolidations to represent a move toward comprehensive portfolio expansion and supply-chain efficiencies.
9. The regulation of everything
The regulation of everything. There’s no escaping regulation. It seemingly touches everything in the retail space, including age-old targets such as wages and tobacco products, as well as newer victims such as predictable scheduling, sugar, plastic bags and even point-of-purchase displays. Will increasing regulations stifle innovation, or will retailers and suppliers deftly adapt and respond? The coming year will reveal best practices emerging from retail leaders, many of whom are focusing on the local level.