The Evolution of Convenience Centers on Customer Experience
LAS VEGAS — Change is happening at lightspeed.
That's how Kim James, senior director, Global Center of Excellence, Merchandising and Marketing at Circle K, describes the state of convenience today.
As moderator of the 2018 NACS Show session, "The Evolving Competition Within Convenience," James advised all c-store operators to ask themselves three questions:
- How can we act?
- How can we take charge?
- How can we embrace our customers in a different way?
Referring to headlines about the rise of Amazon and the closure of many retail outlets, she pointed out the news spells doom and gloom for brick-and-mortar.
"But all is not lost, thankfully," James said. "More stores are opening than closing, and our channel is growing. Our customers need us; they want us."
Still, there is no doubt an evolution is taking shape in convenience and, according to James, it is not the first the channel has experienced. The 1960s brought about the rise of frozen and cold dispensed drinks; the 1970s saw the introduction of the commissary; and the 1990s brought about the popularity of made-to-order food.
Now, it's all about the evolving customer experience.
"Our customers are asking us to take another look at how we deliver convenience," James explained.
What makes convenience stores different is what they sell — time, she pointed out. "We are part of the fabric of their day," James added.
Marketing expert Steve Miller said convenience is not going away, but the question is whether today's convenience retailers will part of the future of convenience.
To survive this latest evolution, Miller advises c-store retailers to stop looking inside the convenience box for inspiration, and instead look at outside "alien" industries.
"Competition does not bring innovation; it breeds conformity," he said. "In order to compete, we have to think about getting outside the box. Create your own box and make your own rules."
Changes are coming as the definition of convenience moves from the store to a concept, according to Ryan Riggs, senior vice president of operations at Global Partners LP.
Disagreeing with the "doom and gloom" outlook for convenience, Riggs explained that Amazon is big because it has created a more efficient, consistent and intuitive experience for the consumer. Winners in the convenience channel will have to do the same, he believes.
"Amazon has created a very easy, seamless process that is a vast improvement to the shopping experience," Riggs said. "It is really focused on the customer experience."
However, as James noted, the key distinction for c-stores is the personal interaction with the consumer. "We own that customer. We are across from them, not a screen," she said.
Being a better marketer will go a long way, Miller and Riggs agreed. Marketing is about getting consumers to want something they don't need. They need fuel, Riggs said, but the challenge is getting them to want something in the store.
"Loyalty programs are a big topic. They are great, especially the larger your brand," he said. "But you want a preference program. You want your customers to prefer you over competitors."
Another major driver going forward: local.
"The key thing to focus on is your local area, demographic and consumer," Riggs said. "Go after local. Why would they prefer me over Firm X? Why am I better? How am I different?"
To that end, James suggests checking out competition outside the convenience channel, seeing what works and reverse engineering it for your own stores.
That, according to Miller, is where you get the "uncopiable."
"It is really hard to climb outside the box and build a different box," he said. "I challenge you to steal from aliens, from industries that are different from you."
The 2018 NACS Show took place Oct. 7-10 at the Las Vegas Convention Center.