The National Advisory Group (NAG) Spring Leadership Series concluded its five-week run on June 16, after informative virtual sessions that discussed topics ranging from consumer trends to technology to fuel disruption.
Moderated by NAG Executive Director and CStore Decisions Editor-in-Chief John Lofstock, the series dissected some of the most pressing issues facing convenience store retailers today as we look ahead to an uncertain future with tech-savvy consumers and less dependence on fossil fuels.
The series kicked off May 19, exploring the topic “How Consumer Behavior Has Changed During COVID,” a presentation from Casey Taylor, vice president of client success for market analyst and consulting firm CivicScience.
Taylor outlined the changes wrought by a year and a half of pandemic lockdowns and safety precautions, and how that has changed purchasing habits — many of which will remain long after COVID-19 has passed.
The way we think about the workplace is permanently altered and put some distance between consumers and what Taylor calls “car culture” — meaning less demand for c-store fuel. Customers now expect to be served where they are — and more often, that will be at home.
Delivery & the New Food Customer
Food delivery took center stage for the second session of the NAG Leadership Series, “The Impact of Delivery and Online Sales: How do we reach new food customers?”
Frank Beard, CStore Decisions director of special projects and director of Safe Shop Assured, led the session with a trio comprised of Mike Kostyo, trendologist with Datassential, and a pair of convenience industry executives: Dyson Williams, director of merchandising and food service for Dandy Mini Marts, which operates more than 60 locations in Pennsylvania and New York, and Kalen Frese, food service director with Warrenton Oil, which operates 36 FastLane convenience stores in Missouri.
Kostyo brought plenty of market insights and even more data to back them up. For example, he mentioned the downsides of partnering with third-party delivery services like DoorDash or Uber Eats, such as a loss of control of a store’s product.
Williams echoed that caveat, advising retailers to keep things simple. “We’re going to try to limit the menu to items that can be made in five minutes or under,” he said. Meanwhile, Warrenton Oil’s Frese said FastLane opted out of delivery entirely and instead focuses on its drive-through and curbside offerings.
Tobacco: Reshaping the Back Bar
Three panelists tackled the third session’s topic, “The Future of Tobacco: Reshaping the backbar amidst legislative threats and PMTA.”
Lofstock introduced panelists Grier Bailey, executive director of the Colorado Wyoming Petroleum Marketers Association (CWPMA); Ryan Faville, director of purchasing with Saratoga Springs, N.Y.-based Stewart’s Shops; and Cole Fountain, director of merchandising with Jacksonville, Fla.-based Gate Petroleum.
Bailey advised retailers to be involved with the legislative decision-making. He said that he lets legislators know that he’s there to help and is interested in solving issues and overcoming hurdles. (For more on Bailey’s legislative advice for retailers, see this month’s Industry Perspective on p. 70.)
Faville advised retailers to be active with their local and state industry associations. Help from advocates is critical in navigating changes. Fountain noted the importance of tobacco for every chain’s in-store sales, advocating that retailers know their sales numbers.
Installment four of the series discussed “How to Create a Next-Generation Store.”
The panel consisted of Beard as well as Jeff Carpenter, director of education and training, Cliff’s Local Market; and Kurtis Hutchinson, director of wholesale operations for Hutch’s Convenience Stores.
Carpenter stressed that tight security is paramount in today’s digital information era. Today’s technology solutions can be highly customizable and help make adjusting to situations easier.
Beard provided insights into the long-term outlook for convenience stores in anticipation of market shifts in the fuel and clean energy arenas. C-stores won’t be able to rely on fuel or electric charging to draw customers. Their future, he said, will be in “winning small baskets.”
Hutchinson stressed operational innovation while sticking to what your stores do best. The pandemic, he said, accelerated retailing trends that were already brewing. Hutch’s turned to drive-through and app-based ordering to serve its customers.
The series’ fifth and final session tackled the topic “Fuel Disruption: How a new administration will impact the fuel market by mandating electric vehicles and flex fuels.”
Lofstock welcomed John Eichberger, executive director of The Fuels Institute, and Jeremie Myhren, chief information officer for Road Ranger and chairman of NAG’s Young Executives Organization (YEO).
Eichberger stressed that the internal combustion engine (ICE) will have a long off-ramp, with battery electric vehicles now representing roughly 2% of light duty passenger vehicles. By 2040, they’ll only be slightly more than a quarter of the passenger vehicles on the road. The convenience industry, he said, straddles the top two businesses where consumers prefer to see chargers: grocery stores (66%) and restaurants (37%).
With the market still in its infancy, Myhren advised c-stores to resist the hype. He stressed that the convenience industry should focus on protecting its relationship with the customer, offering five elements for an alternative fuels strategy.
All five sessions of the NAG Spring Leadership Series are available for viewing on-demand at the NAG Convenience Spring Leadership Series page at NAGconvenience.com.