ATLANTA — Visits to convenience stores have changed significantly, affected by safety concerns, EMV payment rules, vehicle types and so much more. In the United States, while the number of convenience-store transactions decreased 13.9% in 2020, industry inside sales increased 1.5% as customers visited local convenience stores for daily shopping needs.
And, while fuel sales struggled in 2020, summer travel is here already, and the future looks bright for convenience retailers that provide fuel. Half of Americans have or are planning their first 2021 trip between March and August, with 63% planning to travel by car.
Retail technology provider NCR shared insights on the convenience retail industry and what technology trends operators can expect to see play out over the rest of the year and beyond …
Contactless remains king
Contactless payments, self-checkout and curbside pickup will remain mainstays in 2021. COVID-19 accelerated c-stores’ adoption of many types of technologies and practices that reduced contact between store employees and customers. Customers have liked and become used to the convenience of these practices so much that many retailers, including convenience retailers, will extend these capabilities in 2021 and beyond.
Shortly after the pandemic began, a survey revealed that 87% of shoppers preferred shopping with retailers that offered touchless or robust self-checkout options. And stores are taking note: The National Retail Federation found that touch-free options increased for 69% of retailers in the first six months of 2020 alone.
Possible rise in fraud
As of April 2021, retailers, rather than credit card providers, became liable for any card fraud committed at fuel pumps that do not accept EMV (Europay, Mastercard, Visa) payments. Even so, a significant portion of fuel industry retailers—likely about one-third–still have not upgraded their pumps to be compliant with the new rules, leaving them open to potential financial loss if their locations are compromised by fraudsters.
Fuel retailers in areas that have traditionally experienced significant card scams and fraud at the pumps, such as Florida, are more likely to have made the expensive but necessary enhancements to their pumps. Retailers in traditionally lower fraud areas have likely been slower to roll out new pumps. Rather, they have chosen to spend money on other upgrades, such as ways to improve customer experience (CX).
However, retailers in these lower fraud areas may start seeing increased theft at their pumps as fraudsters move out of areas that have already protected their pumps and customers with EMV-compliance. Since fraudulent charges cost more than an annual $200,000 per store on average, fuel retailers will be prioritizing upgrades to their card readers.
Delivery keeps delivering
C-stores were increasingly adopting third-party delivery services before last year, but the COVID-19 pandemic propelled its growth even more. Many brands such as 7-Eleven, Casey’s General Stores and Circle K looked for ways to offset declining fuel sales through services things like digital ordering and delivery.
More recently, Walgreens launched nationwide contactless delivery in less than two hours, with no order minimum but with delivery fees that vary per location. By driving more shoppers to its website and app for delivery orders, the company can gather and analyze its consumers’ data.
Convenience retailers as a whole will continue to look to quicker delivery services as another way to serve customers and improve sales.
Consumers crave options
“Consumers have become accustomed to popular services like curbside, delivery, contactless and better foodservice options that c-stores increasingly offer. They’ll no doubt expect these trends to continue in 2021 and beyond,” said Paul Kern, executive director of product management for NCR, Atlanta. “The more sophisticated retailers are really paying attention to customers’ purchasing patterns and how they interact with store employees. The next step is figuring out how to get to know those consumers even better, so retailers can add more value, sell more and keep consumers coming back.”