C-store Operators Must Paddle Fast to Ride the Waves of Disruptive Change

LAS VEGAS — Change is like surfing in that it's all about paddling as hard as you can before the wave gets you, NACS President and CEO Henry Armour told attendees of the 2018 NACS Show in a keynote address that focused on change, disruption and the future of the convenience channel.

"In this new era of disruptive change, we need to start paddling, and paddling fast. There are an enormous number of waves heading our way and some are very, very close," he said, pointing to electric and self-driving vehicles, on-demand fueling, the increasing focus on healthier lifestyles, legalization of marijuana, and the impact of e-commerce on traditional brick-and-mortar retail.

To navigate the waves, Armour laid out which way the convenience and fuel retailing industry should be paddling to ensure its survival. Rather than focusing on the delivery of a compelling fuel offer that brings people to the stores — which has long been the strategy — he said operators should instead focus on delivering a compelling in-store offer that will bring people to the fuel side.

Three specific areas Armour said the convenience channel should be addressing are:

• Friction in the customer’s journey and the massive technological opportunities to reduce it;
• Electric vehicles and the significant implications for convenience retailers; and
• The changing definition of convenience.

On the topic of friction, he cited companies like Amazon and Starbucks, which have helped "deconstruct" the path to purchase by creating more frictionless customer shopping experiences.

"Mobile order and frictionless payment is a focus we must have," urged Armour.

As for the changing definition of convenience, he explained that NACS research has found that consumers don’t see convenience as a separate retail channel; they see convenience as a lifestyle.

"Let’s not get caught, either as convenience store operators or as suppliers to c-stores, thinking that we are an insulated channel. We aren’t," Armour said. "The world competes for the convenience shopping occasion and channel walls have not only crumbled, they are being obliterated."

Stores that deliver a compelling shopping experience are the ones that will stay afloat.

"We must be paddling to a future in which our stores deliver a compelling shopping experience with products that fuel and excite the immediate-consumption demands of our customers in as frictionless an ordering and payment environment as possible," he concluded.

The NACS Show is taking place Oct. 7-10 at the Las Vegas Convention Center.