Despite the domestic recession, convenience stores have thrived thanks to their ability to provide fast service and quality products in strategic areas. As service and location remains the industry’s primary competitive advantage over grocery stores and big-box retailers that are moving into the fuel and fresh foods arenas, convenience stores have been up to the challenge by staying on the cutting-edge of retail trends.
That forward-looking strategy promises to continue going forward as retailers enhance their foodservice focus. More importantly, retailers cannot afford to let their guard down for one minute.
With customers starved for time and leading ever-busier lifestyles, increasing food sales is absolutely essential for convenience store owners. Like all retailers, c-stores are emerging slowly from the recessionary conditions of the past five years. Fortunately, the characteristics that made c-stores popular for the last three decades remain the industry’s biggest advantages: convenient locations, fast service and low prices.
Trends to watch as we head into 2015 include:
• Healthier Foodservice. Demand for natural and organic foods is growing. This includes seeing more fruits and vegetables on the menu and a real effort to offer locally-produced ingredients. According to the National Restaurant Association (NRA), three out of four adults— including 80% of women—said they want to see healthier items on QSR menus, and some leading chains are taking action. Late last year Burger King launched “Satisfries,” a lower-calorie version of the chain’s conventional French fries, and McDonald’s recently rolled out a new breakfast sandwich, the Egg White Delight, made with cooked egg whites, white cheddar cheese and lean Canadian bacon. McDonald’s also announced plans to reduce sodium by an average of 15% across the menu board by 2015.
Many c-stores, including 7-Eleven, Kwik Trip, RaceTrac and Tedeschi Food Shops responded by introducing fresh foods, including fruits, cut vegetables and commissary-created salads and sandwiches
• Reaching New Demographics. The industry is confident in can satisfy its core customers. Look for a renewed focus through expanded menu offerings, loyalty programs, couponing and other social outreach programs to target the female demographic and young kids. Some chains are even introducing store prototypes that have heavy input from female focus groups.
• Upscale Coffee and Hot Dispensed Beverages. Coffee remains a popular destination for the industry, but the category is changing in major markets. C-store chains are quickly adopting “Fair Trade” and organic brews in response to consumer demand.
• Breakfast Sandwiches. Breakfast is now a very popular daypart for the convenience store industry primarily because it’s been overlooked for so long. Grab-and-go options that emphasize variety are very popular.
• Frozen Beverages. While 7-Eleven’s iconic Slurpee brand is a household name, Dunkin’ Donuts and Starbucks have helped push the frozen category with high-end drinks. The c-store industry is responding with frozen fruit juice beverages and frozen dairy milk shakes that are becoming destinations for customers of all age groups.
• Snacks. Snacking is at an all-time high in the U.S. and convenience stores are meeting the demand. One of the reasons for the consumer’s renewed emphasis on single-serve snacks is that people are doing more activities closer to home. This makes the local c- store a destination for mid-morning and mid-afternoon snacks and beverages.
• Loyalty Programs. Chains of all sizes are now offering loyalty and rewards programs to customers to entice return visits. Customers can earn everything from fuel discounts to free sandwiches. The demand for rewards has grown with all demographics and popularity has surged as the economy has struggled.
• Combo/Value Packages. Whether it’s two candy bars for $2 or a sandwich, drink and a bag of chips for $5, convenience store retailers are embracing value meals like never before. Many are even adding kids combo meals to have an offering for the entire family. As consumers watch what they spend, this trend will continue.