Solving the Mindset Puzzle

CSP forum examines how age, race and weather nudge consumer behavior.

Angel Abcede, Senior Editor/Tobacco, CSP

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Fluid Demand

While several panelists spoke to shopper behavior in general, a few addressed how shoppers view specific products. For this forum, two speakers focused on packaged beverages.

Andy Morris, shopper insights man­ager for Red Bull North America, Santa Monica, Calif., said what most shoppers appreciate about c-stores is the ability to go directly to the item they want, grab it and check out. The opportunity, he said, lies in understanding that purchase and engineering ways to upsell that customer.

In his studies, Morris said a correla­tion exists between low shopping time and high basket ring. “For every second cut, you add 21 cents to the basket,” he said. “So it’s about making it easy for people to shop the store and fulfilling the promise you made.”

But while people intent on purchasing a specific product will “speed walk” to their destination, moving an average of 3.3 feet per second, according to Morris, their walking speed slows down to 2.9 feet per second after grabbing their product. That’s the opportunity to upsell, he said.

One solution he suggested was using the top-50 items that suppliers and a store owner’s own sales data can help identify. Placing those top SKUs in the path of someone leaving a destination point might be a solution. “We encourage you to think about how to take advantage of where the top 50 are placed,” he said, “and how to use these items to create opportunity.”

Tinkering with new or underdeveloped categories may also provide opportunity, said Jeff Schouten, director of channel marketing for MillerCoors LLC, Chicago. For the beer category, for instance, c-stores already represent a casual, quick, cold, brand-specific buying opportunity for people transitioning from work to play. Yet this tried-and-true scenario limits the SKUs a retailer can carry.

A clear opportunity for growing the category is craft beers, he said, but because major brands are important for c-stores, craft SKUs are in an uphill battle for shelf space. While grocery stores—with square feet to spare—may have dozens of craft-beer products, c-stores average five.

But continuing to make the c-store a beer destination means evolving with the tastes of the consumer. “The beer jour­ney,” Schouten said, “is about invitation, exploration and experimentation.”

Evolving Experience

But before retailers become tied to approaching customers on one level, a broader concern may be delivering a bet­ter experience and taking charge of how a store’s brand evolves to stay relevant.

Using Oak Brook, Ill.-based McDon­ald’s as an example, Powell of Shook Kel­ley cited the sleight-of-hand the fast-food chain accomplished on a major scale that kept it grounded in its core products of hamburgers, while evolving its visual look and messaging to evoke a more health-conscious, contemporary feel.

“McDonald’s did not totally move away from its roots, but expanded on that perception,” Powell said. “That’s the kind of thing c-stores need to be working on.”

Brand messaging involves everything from building design to product selec­tion. Much in the same way libraries have “cues” in long study tables and endless shelves of books, or pubs have with bar tables and pint glasses, individual ele­ments assembled in a c-store may evoke an experience that may sell more mer­chandise, or allow a customer to trust a new category such as foodservice.

Part of the goal in creating a new envi­ronment is to encourage the behaviors that the visual cues evoke. “We know how people act in a library,” Powell said. “And we know how people act in a pub.”

Having worked with Louisville, Ky.- based Thorntons Inc., Powell said one of the main challenges the industry has is building on—not losing—its identity as a c-store, and also becoming something more. “It’s about perception and expecta­tions that shoppers have before they step inside the door,” Powell said. “Driving down the street, you see hundreds of buildings, and the c-store is such a com­mon and expected form.”

The way Thorntons changed that iconic image was to develop a “box within a box” design, with the foodservice side of its identity a larger, more graphically interesting “box” juxtaposed with a more traditional c-store frame.

“We thought about how we could change up expectations before the con­sumer even steps inside,” he said. “When you walk in, you recognize that the two boxes offer different experiences.”

Another important ingredient in the brand messaging is making communica­tion clear and easily understood. C-stores frequently are cluttered with messages, with fully stocked shelves, danglers, ship­pers and a host of other elements that create visual chaos, Powell says.

“From the entrance, you want the cus­tomer to look left or right and just notice two or three things,” he said. “You’re not trying to inundate people with too many messages. It’s a common problem.”

How does a retailer pick the right mes­sages? It’s about “what you’re good at, inherent assets, market opportunities. Who are you attracting? What are they coming in for? Do you want to build a new audience? Does it overlap with what you own?” Powell said.

And it’s more than just design. “It has to be solved with a strategic process,” he said. “The retailer has to come to grips with what they’re trying to sell. They can only do a couple of things really well.”

Future Potential

Examining the retail space is also a mat­ter of consumer motivation, or what drives shoppers to shop. Eric Le Blanc, vice president of marketing, deli and convenience stores for Tyson Foods Inc., Springdale, Ark., said one such shopper is an elusive segment but one that ought to be on retailer’s radar: “balancer moms.”

This demographic is about 40 years old but ranges from 30 to 55, has a college degree, ranks the third highest among Tyson research segments for household income, and gravitates to suburban and rural markets. And while it’s the largest segment within the general population of the United States, c-stores are not suc­cessful in capturing them, Le Blanc said.

“Balancing moms are aware of c-stores; they’re trying [things] but not repurchasing,” he said. “It represents a miss for the industry.”

A popular misconception, he said, is that these mothers want to avoid most snacks, candy and other c-store items in favor of what’s perceived to be more healthy. Quite the opposite: Balancer moms apparently index higher for res­taurants such as Chuck E. Cheese and for ice-cream retailers such as Cold Stone Creamery.

“She’s willing to compromise food quality for the environment she’s pro­viding for her kids,” Le Blanc said. “And when it comes to indulgence for herself and her family, she wants the good stuff.”

What was most surprising to Le Blanc was how pervasive the segment was and how little they shopped c-stores. “If you have a c-store in a downtown financial district, in an urban, low-income neigh­borhood, a suburban upscale location or a rural general store, what can you say about all four? Balancer moms.”

This demographic of consumer pro­vides more context as retailers strategize for the future, Wells of Buzz Marketing said. They contribute to and help shape larger trends. Some of those trends include the decline of celebrity, as You­Tube and other outlets make being on TV commonplace; a sense that compa­nies can be both profitable and socially conscious; and the “insanity” of want­ing—and getting—what they want, now.

Wells sees a lot of potential with c-stores and the industry’s appeal to millennials. “They can turn around their inventory relatively quickly, and they have items you can buy for $1 or $20,” Wells said.

In the end, retailers hoping to tap into the continuing evolution of con­sumer makeup and behavior has to marry the expected with the profitable, connecting with shopper needs, moods and perception.


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