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5 topline insights from C-store IQ: National Shopper Study

Defining convenience: New data delves into the minds and habits of Canadian c-store shoppers

Convenience means different things to different people, but for most c-store shoppers it’s about saving time and effort.

As expected, the definition of convenience includes location, hours and product selection, however, for a growing number of Canadian consumers it also comes down to overall ease of experience. 

Convenience stores that prioritize simplifying the shopping and purchase steps are more likely to see rewards with increased traffic and basket size, according to insights from the new C-store IQ: National Shopper Study from Convenience Store News Canada.

C-Store IQ is the first convenience and gas specific study that delves into the wants, needs, perspectives and habits of Canadian consumers. We worked with the research team at EnsembleIQ and Canadian Viewpoint Inc. to survey more than 1,000 convenience shoppers across the country to bring our readers and our partners the insights and data necessary to better understand customers and achieve business success. 

Survey participants shared their definitions of convenience and so much more in this comprehensive study: This is a topline report and we will be digging into the data throughout 2020, both in the magazine and online. 

For starters, Canadian convenience store shoppers associate the word ‘convenience’ with overall speed—41% of those surveyed said it purely comes down to having a “convenient” experience and 34% define this as a “quick stop/in and out.”

Proximity—to home and work—is important, with 25% of shoppers saying convenience is “close to me,” while 16% said longer hours and being open when larger stores are closed is important. 

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WHO’S SHOPPING?

A quick stop at a convenience store is part of the fabric of daily life for most Canadians: 43% shop chain convenience stores and 38% visit independently-owned convenience stores at least once a week.

Millennials lead the charge when it comes to convenience shopping: 50% said they shop a chain c-store at least once a week, compared to 45% of generation X and 36% of baby boomers. For independently owned c-stores, 42% of millennials are more likely to shop at least weekly, compared to 34% of generation X.

WHAT’S DRIVING CUSTOMERS IN-STORE?

Location, location, location: For more than half—54%—the key element that prompts them to visit a particular c-store is proximity, followed by the need to purchase gas (46%) and loyalty programs (28%). 

More than half of c-store customers shop at a convenience store that has a loyalty program and 42% are enrolled in and actively use their store’s loyalty program. 

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Technology and related apps aren’t huge overall drivers for Canadian c-store shoppers, however when analyzing data by generation, new patterns emerge. Younger shoppers prefer less bulk in their wallets, opting instead for mobile apps.

Millennials respond more readily to digital promotional tactics (mobile app, social media promotions, mobile ordering and email) and younger shoppers in general are influenced by promotional signage or car wash promotions during their shopping trip. 

Here’s how digital efforts measure up:

  •     Mobile app: Millennials (14%) are more likely to be influenced than generation X (8%) and boomers (3%).
  •     Social media promotion/offer: Millennials (10%) are more likely to be influenced than generation X (8%) and boomers (4%).
  •     Text message: Millennials (5%) are more likely to be influenced than boomers (0.2%).
  •     Mobile ordering: Millennials (4%) are more likely to be influenced than generation X (3%) and boomers (1%).
  •     Email: Millennials (8%) and generation X (9%) are more likely to be influenced than boomers (4%).

All indicators are that the future is digital, which calls for better optimization and integration of stores’ digital infrastructures.  

WHERE AND WHEN DO CANADIANS SHOP?

Screen Shot 2020-02-11 at 12.56.41 PMCanadians are a loyal bunch, with 70% of shoppers saying they typically visit the same store each time. When considering the convenience store they shop most often, foundational attributes, including the price of products (40%), fun to shop (18%), quality of prepared foods (20%), loyalty programs (19%) and variety of products offered (16%) are the top five reasons why they favour a particular store. 

Screen Shot 2020-02-11 at 12.57.57 PMThe breakfast hours are ripe for shopper conversion, with only 17% of shoppers starting their day with a trip to the convenience store. Visits gradually increase throughout the day and peak during the rush hour/early dinner daypart, with visits from 39% of shoppers.  

 

In an ideal world, shoppers who purchase gas would also pop into the c-store to spend more money, however only 3% say they purchase merchandise and/or foodservice “every time,” while 17% purchase these items “almost every time.” In turn, 19% of shoppers say they “rarely” purchase merchandise or foodservice.

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Of the more than one-in-four people who shop for both gasoline and in-store merchandise at least once a month, 28% say they were recently influenced by frequent buyer/loyalty programs to make the trip inside and spend. About one-in-five were influenced by promotional signage and one in 10 were influenced by mobile app promotions/deals.

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WHAT ARE CONSUMERS BUYING?

Shoppers typically visit a variety of stores to satisfy their needs, however convenience stores are the channel choice of choice for a number of categories. 

Lottery tickets are a key driver, with 53% of shoppers purchasing lottery tickets in the past month, while 46% purchased gasoline. Traditional convenience products are among the most frequent purchases, with 36% of shoppers buying salty snacks, followed by candy or gum (33%), canned/bottled soda (30%), bottled water (26%) and hot dispensed beverages (25%). 

Screen Shot 2020-02-11 at 12.58.43 PMNot surprisingly, among those who purchase cigarettes and other tobacco products, c-stores are the destination of choice: 22% of consumers visit a c-store to buy cigarettes. 

Frozen drinks, almost exclusively the domain of chain c-stores, are a big pull, with 19% of shopping buying these within the last month. 

And, yes, the milk run is still a huge part of the c-store experience, with 30% of shoppers buying milk in the last month. 

There’s still plenty of room for growth in foodservice, with 16% of shoppers stopping for grab-and-go prepared foods (hot dogs, packaged sandwiches, salads etc.) and only 10% buying made-to-order food.

It’s worth noting that those who define themselves as “health-conscious shoppers” are likely to spend more than non-health-conscious shoppers, mostly owing to the higher priced better-for-you products. 

HOW MUCH ARE SHOPPERS SPENDING?

On average, shoppers spent $13.56 during their most recent convenience store trip, not including the price of gasoline. Cards are king, with more than one-third of shoppers (35%) using a debit card, while 31% opted for a credit card. Cash is still a major mode of payment for 30% of shoppers, while mobile payment accounts for only 1% of purchases. It’s worth noting, however, the generational divide when it comes to payment preferences: 38% of boomers and 29% of generation X are more likely to have paid with cash, compared to 22% of millennials. Instead, 41% of millennials said they paid via credit card, compared to 27% of generation X and 25% of boomers.

Younger shoppers already demonstrate higher usage of debit and mobile payment compared to older generations and, as a result, convenience stores will continue to benefit from opportunities to offer more digital or frictionless shopping, payment, and promotional solutions. 

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According to spending patterns, younger shoppers are the c-store shopper of the future: A large percentage of boomers spend less than the younger generations, perhaps indicating they depend less on quick c-store visits to buy essentials. 

Overall, however, as Canadian consumers feel increasingly time-pressed and, in turn, seek solutions to make life easier and more streamlined, c-stores have an important role to play in meeting these needs by delivering the right products, at the right time, right away:  It’s all about convenience. 

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7-Eleven teams up with Microsoft to empower field employees

7-Eleven Inc. is using modern workplace solutions, data services and devices from Microsoft to empower field employees and provide better business insight to franchisees.

The convenience store operator is equipping these field employees, who serve as the connection between headquarters and its franchisees, with Microsoft Surface devices that use Microsoft 365 and Power BI.

This provides franchisees with better insight from corporate into their store’s performance, purchase trends and other data to help them grow their business.

“Franchisees have a significant role to play in our transformation, and empowering them with the right information is critical,” said Gurmeet Singh, 7-Eleven executive vice president, chief digital, chief information and chief marketing officer. “Our collaboration with Microsoft enables us to get data out to Franchisees through our field employees that they can use to make better business decisions.”

Power BI dashboards help field employees to spot trends and visualize insights from point-of-sale data stored and analyzed by Azure Data Lake and Azure SQL Data Warehouse. This enables them to recommend actions to franchisees, boosting sales and ensuring the right products are stocked to meet customer demand, the company said.

Additionally, franchisees can take pictures of their store’s schematics using the Surface camera, which allows them to quickly identify differences from the planogram that they can use to analyze sales opportunities.

“Unlocking the power of data is the key to reinventing the future and delivering amazing customer experiences in the retail industry,” said Shelley Bransten, corporate vice president of worldwide retail and consumer goods industries, Microsoft Corp. “We’re thrilled to empower 7-Eleven’s field and franchisees with the services, knowledge and devices to innovate on behalf of their customers wherever they are in their shopper journey.”

Field employees will be able to use Surface as their mobile office; use Microsoft OneDrive to give them real-time access to the latest corporate assets; and use Microsoft Intune to provide the security capabilities needed for a mobile workforce, with the ability to remotely manage devices and protect data.

7-Eleven is also migrating its infrastructure to Azure and leveraging advanced technologies such as AI to power enhanced customer experiences. The companies expect to apply future collaborations across intelligent and emerging technologies such as AI, data analytics and blockchain to drive even greater insight, efficiencies and customer experiences across its business, the convenience retailer announced.

Irving-based 7-Eleven operates, franchises and/or licenses more than 68,000 stores in 17 countries, including 11,800 in North America.

Originally published at Convenience Store News.


Convenience retailers must tap innovations to meet consumers’ ‘sky-high’ expectations

Retail technology is becoming a bigger priority than ever before, as evidenced by the record number of attendees at the 2019 Conexxus Annual Conference in Nashville earlier this month. The 200-plus convenience store industry members at this year’s event have a full plate when it comes to innovation.

Kwik Chek Food Stores is just one of them. Kevin Smartt, CEO of the Texas-based chain and chairman of the Conexxus board of directors, told conference attendees that his company’s innovation pipeline is full and runs the gamut from loyalty programs, to mobile app food ordering, to the testing of self-checkout and mobile checkout, to deep data and consumer analytics, to blockchain.

Regardless of what is on the “to-do” list, though, it all comes down to putting systems in place that are critical to the c-store consumer, Smartt explained during the event’s opening session.

“We sell a lot of stuff, but we really need to understand our consumer,” he said. “Then, we need to understand what our consumer wants.”

THE FUTURE LANDSCAPE

The future landscape of retail and technology’s role in it is “simple” and boils down to a few key themes, according to Gray Taylor, executive director of Conexxus. These themes are:

  • Technology will continue to empower fickle consumers.
  • Every business is in the convenience business, and the definition of “frictionless” changes daily.
  • Every business will be in the data business.
  • Traditional scale is dead weight; new scale comes from the technology and logistics pool.
  • IR4 technology, or the fourth industrial revolution, will eradicate distance, location and immediacy as “moats.”

“The digital consumer has sky-high expectations when it comes to convenience,” Taylor said. “We have to ensure a convenient and frictionless shopping experience. Accessibility and relevance is no longer about physical location, but also about digital presence.”

EVOLUTION OF RETAIL TECHNOLOGY

The convenience store industry has seen its technology move beyond the basic forecourt to the store-to-the back office model. With innovation, the industry “is moving the store out into the customers’ hands” with initiatives like loyalty programs and mobile payments, Taylor explained.

The next generation, he believes, will include more cloud-based security, self-checkout, digital customer-related management and artificial intelligence (AI) checkout. This new wave is expected to come within the next five years, he said.

Looking three to seven years out, the industry will see advanced analytics, IoT (Internet of Things) food safety, vendor data exchange and home delivery. And if Taylor had to pick just one technology to keep an eye on, he said it would be autonomous delivery vehicles.

MOVING FORWARD

As more work needs to be done in the convenience store industry, the Conexxus chief advised retailers to keep some questions in mind:

  1. Are you prepared to defend your turf and expand into new turf?
  2. Are you driving efficiency in the supply chain?
  3. Is your technology stack encouraging innovation?
  4. Do you have a data-driven culture?
  5. Do you have your eyes fixed on the horizon?

“Retailers need to be leaders,” he said. “You cannot look to your vendors to tell you what your customers want.”

Originally published at Convenience Store News. 


7-Eleven’s digital strategy is about expanding customer interactions

As technology advances, improved hardware can make a big difference in retail performance, but equally critical — or potentially even more important — is data and how it is used.7-eleven-logo-500x400

“Disruptions are coming at the c-store industry everywhere you look,” Kimberly Otocki, content marketing specialist for Paytronix, said during a recent webinar presented by the company, titled “How 7-Eleven Is Changing the Game…Again.”

This includes regular convenience stores that are embracing new technology, as well as outside competitors like Amazon Go. Additionally, dollar stores are starting to rival c-stores as they try to claim the convenience factor for themselves.

“Convenience is changing, and that’s why 7-Eleven is reacting the way they are,” Otocki said, pointing to the company’s 7Rewards loyalty program as the centerpiece of its digital strategy.

The primary goal of 7-Eleven’s digital strategy is to expand customer interactions beyond the four walls of the store and the forecourt.

Customer data is the key to customer engagement, used as the foundation for how 7-Eleven communicates with customers, how it gets them to return and how it keeps their loyalty, according to the webinar.

Smartphones and mobile devices offer multiple paths to mobile engagement, including push and pull messages, customer surveys, mobile-responsive emails and geofencing.

Geofencing in particular is a way of ensuring that c-stores message customers at the right time through the right medium, according to Otocki. Based on GPS, retailers can set a certain distance from their store at which their mobile app will notify the customer of reward items they are eligible for or what items are currently being promoted. The messages can be tailored to individual customers based on their existing data.

SMS text messaging is another way to reach and engage customers — and a popular one, as 75 percent of consumers indicate they would like to receive offer messages through this medium. SMS apps are also one of the most frequently used types of smartphone apps. As a result, companies can send personalized messages based on data in a medium they know customers are going to be in.

One platform-specific digital initiative that 7-Eleven has launched is a Facebook chatbot, which customers can message to seek out the nearest store or investigate deals, promotions and rewards point balances.

The digital trend that may be most important in the future, though, is mobile ordering and payment, as well as delivery, Otocki said. 7-Eleven first moved into this area by utilizing Apple Pay, Google Pay and Amazon Cash.

Mobile payments are a win-win scenario, offering customers faster-moving lines and offering retailers more data they can use to improve their customer experience.

Mobile payment can even give older stores a different feel, according to Otocki. “[Customers] see it as quicker and easier,” she said.

On the delivery front, she noted that it isn’t home delivery or nothing; c-stores can set up programs that deliver items to drivers at the fuel pump, connecting in-store purchases to out-of-store customers. Retailers can also designate pickup points for pre-ordered purchases.

7-Eleven is also experimenting with scan-and-go technology, simplifying the checkout process even further.

The key to success isn’t any one type of new technology, according to Paytronix. Retailers will likely succeed if they use data to help them change and stay ahead of the curve.

Paytronix provides loyalty programs and customer engagement solutions to convenience stores, restaurants and retail chains.

Originally published at Convenience Store News.