It’s been a tumultuous decade for convenience stores, but that hasn’t stopped their rapid growth. This is due, in part, to consumers’ growing preference for a quick one-stop shop. It can also partly be attributed to c-stores’ ability to quickly respond to changing trends.
As gas prices rose, convenience stores responded by increasing the value of in-store purchases. When pay-at-the-pump dug into their bottom line by diminishing impulse buys, convenience chains looked for new reasons to get consumers in the door.
For many chains, that meant taking food more seriously. As consumers pull away from traditional fast-food chains like McDonald’s, East Coast-based Wawa and Sheetz have become pioneers in the convenience food space, offering made-to-order sandwiches and other fresh, delicious fare.
QuikTrip has followed suit, rolling out QT Kitchens to fill its stores with ready-to-eat options that are healthy. A stroll down a QT aisle will reveal grilled chicken salads, fresh fruit (peeled and cubed), yogurt parfaits and a variety of sandwiches featuring sliced meats and fresh greens. Customers can also choose something like a warm flatbread, personal pizza or a fruit smoothie from the made-to-order counter.
Midwest-based Kum & Go likewise is reconfiguring its locations to include full kitchens for breakfast, lunch and dinner. Some locations offer a Go Fresh Market, featuring food made at the store.
More stores are sure to follow this trend because it’s a great idea for luring people inside.
From Filling the Tank to Filling the Stomach
The convenience store industry is incredibly diverse, with competitors literally around every corner. Customers can get fuel from QT, Kum & Go, Casey’s or even Walmart, so what makes them choose a particular store?
Most c-store customers are loyal out of convenience; they always stop by because they live in the area. But serving great food inspires true loyalty. In fact, 90 percent of people who consume c-store food say the taste and quality of the food are important in their choice of stores.
Convenience stores have always offered some kind of food, but most of those on-the-go staples have never been regarded as quality food. Snacks like doughnuts, nachos or microwavable burritos might curb consumers’ hunger, but to truly compete against fast food, c-stores must offer something better.
Offering quality full-service food can be a major investment, but it’s one with the potential for high returns. Couche-Tard, operating in North America and Europe, grew 54.7 percent in 2013 by capitalizing on a variety of trends, including in-store food purchases.
The key to seeing major returns is quality — and getting customers to recognize it.
Changing the Way Customers See Your Store
Over the past few years, c-stores have been getting cleaner, and their food has been getting better. While customers may grab something to eat because they don’t want to make an extra stop on the way home, they still don’t view convenience stores as meal destinations.
As more c-stores serve soup that’s made daily, great sandwiches with fresh ingredients, and flavorful pizza, consumers are beginning to come around. The trick is getting them to try it.
People don’t expect to pay premium prices for food in a convenience store, no matter how good it may be. It’s about changing consumers’ expectations and getting them onboard.
Here are six tips for establishing a successful full-service food offering:
1. Leverage major brands.
Partnering with recognizable brands is a great way to quickly gain consumers’ trust. Customers already have experience with brands like Campbell’s, Kraft, Folgers and Starbucks, and they immediately associate the brands they love and trust with quality and value.
2. Carry fresh foods.
Carrying more fresh food and food associated with healthy eating helps create a new brand perception for your store. By positioning these foods against less convenient options at higher price points, you can access new customers in other markets.
3. Provide higher-quality touchpoints.
Offering a full-service counter or delivering food to a customer’s table creates a better experience overall. Your customers will have a better sense of the service and quality they can expect, which creates a stronger tie to your brand.
4. Offer a variety of price points.
Offering more products at diverse price points attracts customers who are looking to pay for healthier foods of higher quality. You’ll be able to create more revenue and a positive brand experience that increases repeat customers and lifetime value.
5. Access the senses.
This is a simple one: cook food that smells amazing inside the store and people are more likely to buy it. According to “Smellizing Cookies and Salivating: A Focus on Olfactory Imagery,” smelling a product has a greater effect on consumer responses than imagining the smell when looking at a visual advertisement.
6. Invest in remodeling.
When c-stores invest in remodeling to look new and modern, they’re seen as a viable option for fast food. Legacy Landing in Washington, for example, has received interior design awards, taking the traditional c-store image to a whole new level.
Reaping great returns really does come down to making major changes. The c-stores that are blazing the trail in this movement aren’t the ones simply offering burgers and nachos. The pioneers — and the ones that are going to see real returns — are the ones creating a quality customer dining experience.
If you want to capitalize on the full-service food movement, develop a culinary vision for your convenience store and take action to make it a reality.
This article was written by Doug Austin and originally appeared on the Convenience Store News site.
Doug Austin is senior vice president of growth and innovation for Marlin Network, where he leads product and brand innovation sessions. For nearly 30 years, Austin has been studying the “art of observation” and filtering out the human truths. Whether digging for key consumer insights or preparing the next national retail promotion, it’s all about the ability to “hear and see” what others may not, and asking the hard questions. For more on the Marlin Network, visit MarlinNetwork.com.