Chris Kaden knows the year ahead is full of risks that he must take. Just months into his new job as category manager of general merchandise for Alon Brands, Kaden is pushing forward with a plan to revamp the retailer’s offer. Innovation, he says, is critical for energizing what has been a sluggish category for the Odessa, Texas-based retailer, which operates nearly 300 7-Eleven branded stores in central and west Texas and New Mexico.
“The category is begging for attention,” Kaden says. “My go-forward for 2015 is trying to wake up a stale, stagnant section and really bring relevance to what today’s consumers are looking for.”
Take the Long View
For the busy c-store, general merchandise requires careful management to stay on top of trends and avoid getting stuck with unsellable merchandise.
A few years ago, concerned by competition from dollar stores, Alon Brands focused its efforts on a value-priced offering of health and beauty products, paper and soap. But now that concept is being phased out.
“My strategy is going toward toys or gifts that I can get a higher ring on,” Kaden says. “Those items will improve the image inside the store as being one with a higher-quality selection.”
With this long-view approach, Kaden wants the general-merchandise offer to appeal to millennials, baby boomers, women and even children. These groups represent “who we want the core convenience store customer to become,” he says.
In an effort to lure tech-savvy millennials, Kaden has expanded the chain’s offering of prepaid cellphones and accessories and added Bluetooth-capable gadgets that work with smartphones or tablets. One item he expects to perform well is the Selfie Stick, an extendable monopod that lets you take smartphone photos of yourself from beyond arm’s reach.
For on-the-go women looking for value, Alon Brands will now offer a selection of beauty products from e.l.f Cosmetics, also known as Eyes Lips Face. A power-wing display designed by e.l.f. includes 34 SKUs offering everything from eyeliner to lip products at affordable prices. The cosmetics company updates the colors seasonally. Kaden saw the display in use at 7-Eleven corporate locations in Dallas and decided Alon Brands should offer it, too.
A new selection of licensed toys that includes Marvel characters from Nickelodeon’s Nicktoons and LEGO-inspired products should appeal to younger shoppers. Alon Brands also is adding a line of novelty glasses called Sun-Stashes. They transform the wearer into SpongeBob Square Pants, a Teenage Mutant Ninja Turtle or a character such as a leprechaun. They were a big success on “Shark Tank,” and Kaden is confident they’ll be a big hit in Alon Brands stores.
“We’re trying to put more emphasis on those items by bringing visibility with prominent displays, causing disruption in the store, and letting people know that we’re relevant with what is trending today,” he says.
A 360-Degree Experience
Like many of these innovative products, however, the funny glasses are untested in the c-store arena. Being the first to try something requires careful tracking and a willingness to disengage when sales aren’t going as hoped, Kaden says.
“There’s always a risk in having something new. You don’t know how it will perform,” he acknowledges. “But innovation is very important so you don’t become stagnant or left behind.”
Scan data is always critical in managing the category, but Kaden says he also relies heavily on the expertise of Alon’s supplier partners. He watches major retailers, such as Walmart, Target and Best Buy, and shops the c-store competition.
As part of the category’s overhaul, Alon Brands has been redoing front-end counter plan-o-grams, conducting endcap reviews and looking for opportunities to add shopper-stopping gondolas for a “360-degree shopping experience.”
Kaden plans to try different strategies, running merchandise in-line where it works or placing endcaps that serve as points of disruption.
Given the company has 83 stores in El Paso and 23 in Albuquerque, N.M., Kaden cites the importance of a general-merchandise section that appeals to Hispanics. Even in lighters, he has found a preference in BIC lighters that feature designs geared toward Hispanic culture and history.
Finding Fans
In prepaid, where cellphone popularity has largely been relegated to long-distance and prepaid phone minute cards, Alon will introduce the “Bring Your Own Device” concept from InComm.
“If you have a phone not being used, you can bring it in and you can purchase a SIM card plan,” explains Brad Eaton, Alon’s category manager for beer, packaged beverage and prepaid products. The card works with most phones, comes with a variety of plan options and can be reloaded at the store, he says. The product already is available at 7-Eleven corporate stores.
Alon also plans to focus on better training so that with sales of prepaid debit cards, employees will encourage customers to return to the store to reload the cards. Also in prepaid, Alon will add a proprietary gift card this year that can be used for fuel or c-store products. Eaton expects the card to be popular for gift-giving, as well as with churches and charities who might purchase cards to help provide for people in need.
While innovation will drive much of Alon’s general-merchandise efforts this year, Kaden also is looking to expand aspects of the category that already are successful.
Football is huge in Texas, with two NFL teams and several college teams vying for fan allegiance. Team-related merchandise—from beer koozies to T-shirts—is a profit generator, Kaden says.
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