In 2020, convenience stores are enticing customers with increased category innovation, from new beverage varieties to fresh food to mobile payment options. In the year ahead, c-stores are also set to face ongoing challenges, including increasing tobacco regulations, technological disruption and growing competition from other channels on ‘convenience.’
The U.S. convenience channel today is comprised of more than 155,000 convenience stores. As competing channels look to encroach on the convenience landscape, c-store operators are expanding on the convenience concept by adding made-to-order foodservice programs that feature healthy food options, as well as delivery and order-ahead/pick-up in-store options. From food kiosks to mobile loyalty programs and electronic payments to electric vehicle charging stations, c-stores are investing in cutting-edge technology to best the competition.
As Gen Z infiltrates the marketplace, c-stores are expanding and fine-tuning their product assortments to meet the evolving needs of today’s consumer.
Efforts are paying off. Dollar sales at total U.S. c-stores were up 3.3% for the 52 weeks ending Dec. 29. 2019, compared to 2% for total multi-outlet (grocery, drug, mass market, military, and select club and dollar retailers), according to Chicago-based market research firm Information Resources Inc. (IRI).
IRI reported that 98% of the U.S. population shops in convenience stores each month, generating more than $200 billion in annual sales.
Customer confidence is currently holding steady — up 1% year over year — with 57% of customers noting they feel positive about their financial well-being, and 73% expecting their household’s economic health would improve over the next six months, according IRI’s “Q4 2019 Consumer Connect Survey.”
What’s more, customer demand for convenience and value is growing more influential, IRI found in its recent report, “Channel Trends in CPG Today.” Value retailers, including dollar stores and e-commerce sites, are seeing upticks in customer penetration. When selecting where to shop, factors such as in-store experiential concepts, price and easy navigation services are influencing customer decisions — factors savvy c-store operators are incorporating as they innovate for tomorrow.
Check out the March issue of CStore Decisions, where we outline 38 c-store categories, including one of the newest — cannabidiol (CBD) — sharing the must-know trends impacting each segment.