Leaving Money in the Parking Lot

Convenience store retailers are investing heavily in enhancing their in-store offers, from expanding their fresh food options, to introducing new customizable beverages, to developing exclusive private-label products that can't be found anywhere else.

Still, however, 56 percent of the convenience store shoppers surveyed for the 2023 Convenience Store News Realities of the Aisle Study — which polled 1,500 consumers who shop a c-store at least once a month — said they visit a convenience store weekly for fuel only.

And despite retailers' ongoing efforts to boost their in-store offerings, the sales mix of the industry continues to skew more toward fuel. According to the 2023 CSNews Industry Report, the longest-running annual analysis of U.S. c-store industry performance, fuel comprised 66.2 percent of total sales in 2022 while in-store comprised 33.8 percent.

During the height of the COVID-19 pandemic in 2020, when Americans were driving less, staying home more and looking to consolidate trips, the c-store industry's sales mix shifted to just 54.4 percent fuel and 45.6 percent in-store. But that swing proved short-lived.

It is apparent that more must be done to increase the pump-to-store customer conversion rate, especially because in terms of profitability, in-store most often provides the best margins for operators. Last year's convenience channel gross profit dollar mix was 59.2 percent in-store vs. 40.8 percent fuel, according to our Industry Report.

So, how can c-store operators get more customers from the pumps into the store?

It starts with making customers filling up their gas tanks aware of what products and services they can find inside the building. Advertising through audio and video messaging at the pump on a screen or within the retailer's mobile app can accomplish this.

To take it to the next level, operators can enable in-store items to be purchased by the customer while at the pump. Again, this can be done through the fuel pump itself or via the retailer's mobile app. At Parker's, the Savannah, Ga.-based operator of convenience stores in coastal Georgia and South Carolina, customers can use the retailer's app to activate the fuel pump, pay for fuel, and order and pay for food for in-store pickup, bypassing any lines inside.

[Read more: Parker's Debuts Refreshed Parker's Rewards App] 

The final step in the pump-to-store equation is personalizing promotions. Whether advertised through screens on the pump or a mobile app, the more personalized the offers, the better. Loyalty programs can be integrated into the fuel dispensers to personalize offers based on a customer’s spending history and even greet the customer by name.