The convenience store channel is still a relative “newbie” to foodservice, even though it has been gaining traction for the past 25 years. Most of the industry remains well acquainted with Clark Griswold’s famous quote in the 1980s film Vacation, “I’m so hungry I could eat a sandwich from a gas station,” which summed up the majority perception of c-store foodservice 40 years ago.
Prior to the 1990s, the convenience store was more likely to hold a pot of coffee and a few well-aged hot dogs endlessly rotating on a grill.
Fast forward to the 2010s, and foodservice at c-stores became more mainstream as chains began experimenting with drive-throughs, dinner options, fresh cut fruits, grab-and-go salads, made-to-order meals, and even baristas in stores.
The change in c-store perception has been due to both operators’ desire for the higher margins of prepared foods — to replace falling margins in other categories like cigarettes and fuel — and the changing demographics of the U.S. consumer.
Today, the core c-store shopper demographic includes both Millennials and Gen Z, who came of age after many top-quartile c-stores began upgrading their foodservice sections to resemble a Panera Bread or similar fast-casual concept, complete with fresh made-to-order healthy fare.
Enter 2020. This year has brought unforeseen challenges to the c-store world like no other. As the COVID-19 pandemic keeps its grip on the country, c-stores are losing daily commuters, who used to seek breakfast and lunch options on the way to work.
While retailers have had to adapt to technology, curbside pickup, delivery, social media and sanitation, consumers have not necessarily changed the order of the top five critical factors used to select and prioritize away-from-home occasions.
In a typical year, prepared foods selection is based on convenient location, the food offered, taste, affordability and the speed of the transaction. Convenience store customers have not wavered on the importance of health and nutrition in concept selection during the pandemic, however. It is nestled within the next selection tier with factors such as courteous employees, high-quality ingredients and portion sizes. Meanwhile, the performance of most c-stores when it comes to healthy food options, still lags behind several competing channels.
That said, healthy and nutritious food desires are no longer a fad. As Millennials and Gen Z become the primary users of away-from-home food, their desires for social responsibility and demand for healthy — but great tasting — items are only expected to increase.
Across the board, consumers are interested in healthier options, but Millennials and Gen Z specifically are the primary consumers as they have been introduced to a broader menu than Gen X and baby boomers ever were. Because Gen Z and Millennials prioritize healthy food, it’s unwise for c-stores to ignore this foodservice segment. Many top quartile c-stores, as a result, are doubling down on healthy menu items.
The need for healthy food options is expected to increase as consumers limit trips in general — and moreso during the pandemic — and continue to work and attend school from home with no end in sight. Meal kits, for example, are already on the rise because consumers are looking for convenient ways to achieve a balanced diet during lockdowns.
What’s more, as customers look to minimize trips, c-stores are providing an ideal one-stop shop where they can stock up quickly while social distancing. Instead of visiting a quick-service restaurant and a supermarket, shoppers are able to get gasoline, and pick up milk and prepared foods from a single c-store location.
This shift in shopping habits makes stocking a variety of healthy food options key for c-stores that are vying to be the store customers select for this single trip. CSD
Julie Guy is a senior associate at Foodservice IP, www.foodserviceip.com. Foodservice IP is a research-based management consulting firm and is launching a comprehensive c-store grab-and-go foodservice study with shoppers and retailers. More details can be found at https://foodserviceip.com/wp-content/uploads/2020/08/FSIP_c-store_8_2020.pdf