Delivering solutions for people’s immediate needs built our industry. At one time offering gasoline and cigarettes, along with some minimal grocery staples, won a place in our customers’ hearts. We sealed the deal with extended hours and multiple locations. However, today’s customers have higher expectations and a more sophisticated palate. Plus many new competitors are vying for the consumer’s attention.
The c-store industry has risen to many challenges. We have added a variety of food options, many prepared in-house or delivered fresh daily. We’ve ramped up the selection and quality of product in our stores and expanded our beverage offerings. But is it enough?
While our customers’ core desire remains the same—quick and easy with the best service possible—we must continue to look ahead if we are to remain our customers’ first choice for convenience.
So What’s Next?
Let’s look at four segments of innovation, which are critical for keeping existing customers and attracting new ones.
▶ New Products and Line Extensions:
The industry is well equipped to extend product lines, including alternate flavors and assortments that excite consumers such as new chips, soda and non-carbonated beverages. Drinks now satisfy thirst while providing a boost of energy; many contain “better for you” ingredients that go beyond new flavors. Package sizes are always in flux with smaller or larger portions and price points designed to appeal to our diverse customer base.
The consumer wants e-cigarettes, and c-store retailers of course are offering them. Wine and spirits companies are embracing our industry and customers. And alternative fuel products from compressed natural gas to new blends of ethanol are providing positive sales for some chains.
▶ Alternative Services Offers:
Cellphones without contracts or data plans, prepaid credit cards and banking services such as ATMs are common in nearly every store. Redbox and other video kiosks are becoming the standard. Expansion of these services continues as more customers want the control and convenience of prepaid technology and quick entertainment. New mobile applications can improve recognition and the relationship with your best customers.
▶ New Delivery Systems:
Retailers are exploring new payment systems such as self-checkout. The store layout is changing with more creative store design that includes shopping zones. This configuration promotes additional impulse sales and becomes more critical as customer transaction trends have slowed.
Multiple entry points for ease of parking also improve the speed of the shopping experience. Mobile payment has sped up checkout, and some stores are testing drive-thru, but we must be careful that we don’t let service slip because of the convenience factor.
▶ New Categories:
Introducing new product categories in the store setting is risky and can often result in failure. But if it is successful, it can reap great rewards. What new products or services can we offer in our stores? For a new category introduction to be successful, it must jump many hurdles: initial equipment and capitalization costs, delivery method, product shelf life and training. One innovative c-store retailer recently introduced fresh meat to accompany the fresh produce it already sells.
What are the risks of new product categories? As the innovation of a new product increases, risks to our business increase. It is relatively risk-free to accept a new flavor from a proven supplier or add a new service from an established company, especially when the company assumes the cost of setup. New delivery systems are a risk, but new product categories are the greatest risk of all, demanding a higher start-up investment.
To mitigate the risk, we need to embrace industry meetings and challenge our teams to find the most innovative and exciting products. We should all study trade publications such as CSP to stay on top of the latest trends and learn from the wider industry experience. Join a share group to talk about the successes and failure of innovation and learn new avenues of creativity and opportunity. We must continue to evolve and develop a strategy to remain the customer’s daily stop in the future. Are you ready to innovate?
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