10 Insights From Convenience Retailing University 2020

NEW ORLEANS —CSP’s 2020 Convenience Retailing University was a rousing collection of packed general sessions that inspired creativity and innovation, coupled with smaller, category-focused breakouts that featured close looks at category sales and trends, as well as thought-provoking consideration of where they are headed next.

Sprinkle in a taste of New Orleans, c-store visits, CSP’s Category Manager of the Year awards and a Mardi Gras parade viewing party, and many said the rejuvenated CRU conference was the best category-level event they’d ever attended.

It showed in the attendance: CSP hosted a record number of retailers, more than half of which were newcomers to CRU. They had the opportunity to choose from one of eight category tracks to follow: foodservice, packaged beverages, behind the counter, dispensed beverages, CBD, technology, center store and loyalty.

Technomic Principal Donna Hood Crecca set the stage for the two-day event by pointing out that the convenience-store category manager is constantly evolving. What used to be a tactical, often siloed role is now strategic and integrated with the rest of store operations, she said. These individuals must use shopper insights, market metrics and product customization to succeed in today’s changing landscape. “You have to be creative and analytical at the same time,” she said. “[Category management] is far more complex than in the past.”

Here are some highlights from the conference …

Even as many retailers are just getting into some form of delivery, third-party delivery providers are rethinking their model, according to Robert Byrne, director of consumer and industry insights for CSP sister data firm Technomic, Chicago. This comes as these companies struggles to make the business of getting product to people’s homes profitable, Byrne said during the Marketing Insights forum at CRU. One solution for third-party providers is to evolve into a data provider, selling the information they collect through their daily deliveries to reflect consumers’ consumption habits, he said.

The recent quick-moving mechanics of new tobacco rules and bans enacted by lawmakers or health officials have added up to a whirlwind of things to do for retailers. These include educating the public and employees, handling product properly at the store level and sorting through the logistics of returning merchandise and getting the proper refund, said Kraig Knudsen, category manager for Circle K’s Heartland division, Lisle, Ill. While speaking on a retailer panel at CRU, he said those imposing the new rules often don’t produce the answers needed to execute on their new demands, forcing retailers to interpret the rules for themselves.

For all the potential uses of facial recognition technology in c-stores, there also are a few cautions. Particularly, if a store is invading someone’s privacy, there better be a good reason for it, said Jesse Hirsh, owner of Metaviews Media Management Ltd. during his general session presentation. Facial recognition in c-stores could facilitate a type of loyalty marketing program. For example, a customer could enter a store and be immediately offered a deal. Another way it could be used is for security purposes; however, Hirsh acknowledged that even makeup could fool a camera.

C-stores could do more to bring in female customers, according to Larry Levin, executive vice president of consumer and shopper marketing for IRI, Chicago. Twenty-five percent of women don’t see c-store food as fresh, and 40% said c-stores are not top of mind for fresh foods. As a result, about a quarter of women are going to c-stores less often than in the past, with half of them going a lot less often, Levin said.

Everyone is struggling with labor. Retailers in rural locations said they have trouble finding people who can consistently get to work due to lack of a driver’s license or reliable transportation. To help combat this, they have to make sure their managers can be in the store if staffing is low. One retailer is also changing where the company does interviews, bringing potential candidates into the store where they would work, rather than a corporate office, with the goal of helping with employee retention.

Duncan Wardle, former head of innovation and creativity for Disney, said there are several ways businesses can foster creativity and innovation. One is to change the phrase “no, because” to “yes, and” when it comes to talking about new ideas. While managers can’t say “yes” to every new idea, saying the phrase “yes, and” during innovation brainstorming sessions can help lead to bigger and better ideas, whereas beginning a response with “no, because” too often may prevent employees from coming to you again to propose new ideas.

New gaming and digital lottery systems are raising eyebrows in 2020. These systems, many of which allow users to buy and play on a mobile device, target consumers seeking a new type of c-store lottery experience beyond classic scratch cards, said Jesus Gutierrez, director of account management of lottery and gaming for InComm Inc., an Atlanta-based payments technology company that connects lottery retailers with state-sponsored lotteries.

InComm’s lottery products, such as QuickTicket and TapCentive, work as application program interfaces (APIs). The APIs offer operators the ability to sell and distribute digital lottery reward cards through a single connection. They also allow operators to control and customize the front-end experience of these rewards.

“We’re not going to alter the way traditionalists play lottery,” Gutierrez said. “We’re trying to attract new and younger customers into retail to play these games.” InComm also helps retailers get involved with mobile sports betting. Ninety percent of U.S. sports betting revenue in 2019 came from New Jersey and Nevada, he said, suggesting opportunity awaits in other states.

Convenience-store foodservice is growing, thanks to strong performances from leading brands, said Aimee Harvey, senior managing editor for CSP sister research firm Technomic, Chicago.

Performance across the board in c-store foodservice has been strong: Technomic projects c-store foodservice sales to grow 3.2% in 2020, she said. Some of this growth is being sparked by surging entree types. The fastest-growing entree categories in c-stores include breakfast starches, Mexican fare, salads, sandwiches and pizza, Harvey said, citing Technomic’s Q3 2019 MenuMonitor.

“Retailers are still doubling down on breakfast, still want innovation in the morning and want to enhance their coffee programs in the morning,” she said. “Salad speaks to the consumer demand for health; they are the easiest avenue to building healthy on a menu.”

Video gaming is legal in only nine U.S. states, making it a challenge to understand and adopt. The first thing retailers interested in gaming should do is work with their legal department and check local regulations, said Josh Grayson, operations category manager for TravelCenters of America LLC, Westlake, Ohio. Once they understand their regulations, they should move forward and find a supplier.

“You want to find operators that are backed by a large casino,” Grayson said. “Contrary to what we see in movies, casinos are legitimate operations. Get with them and go from there.”

CSP announced the winners of its fifth annual Category Manager of the Year (CMOY) awards during CRU. The winners, as chosen by supplier vote, were:

• Paul Crozier of Sheetz for CBD
• Jackie Stalsberg of Kwik Trip for center store
• Alex Kupper of Thorntons for dispensed beverages
• Marissa Tinoco of Army & Air Force Exchange for foodservice
• Abigail Cerra of Cal’s Convenience for multiple categories
• Michael “MJ” Simons of MAPCO for packaged beverages
• Josh Grayson (pictured) of TravelCenters of America for technology/operations
• Kraig Knudsen of Circle K—Heartland for tobacco/vape/OTP

Next year’s Convenience Retailing University will encourage attendees to “Stay on Track” as CSP repeats its category-specific breakout sessions. It will be held Feb. 23-24, 2021, in Orlando, Fla. Click here for more information.