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10/14/2021

Make Your Next Customer Visits Digital

Convenience retailers must shift their focus and make digital experiences more of a priority.
convenience store digitization

While many brick-and-mortar retailers have shifted their focus away from the physical and toward the digital, convenience retailers have been somewhat hesitant to alter their course of action.

Recent years may have witnessed new investments in taller pole signs, larger lots and restrooms that don't scare away customers, but the overall playbook hasn't really changed from what it was six decades ago. It's still about investing in physical retail as a way to drive sales.

There's an intersection on the outskirts of my city where three major brands — yes, three — have all built shiny, state-of-the-art convenience stores. Even if you were the last one to that party, it's easy to see why they made that decision. With gross profits up 32.4 percent over the past five years, why would anyone look to other avenues for growth?

However, while these brands were finalizing their plans, other retail sectors — and restaurants — were starting to ask how they could expand beyond relevant corner locations and compete for a newer and more coveted form of real estate: the home page of consumers' mobile phones.

Booster started fuel delivery, Gopuff cornered the college-town delivery and snacking market, Bevmo created an online beer cave, and Wingstop launched the Thighstop brand.

Because of these different investments, it became clear who was ready for an acceleration in digital trends and who was not. As an industry, the convenience retailer's digital experiences were primarily made up of data repositories and discounting mechanisms.

This past year, we watched in real-time as brands did their best to stand up new digital experiences including online pickup, mobile pay and delivery. But hurried execution and the lack of a proper foundation led to situations like notes pinned to the front door that told customers to call a phone number to place their pizza order.

If convenience retailers are going to play that game effectively in the near future, they must shift their focus and make digital experiences more of a priority. The key to this success is two-fold.

First, retailers need to define what digital experiences most align with their brand, thereby creating a roadmap that the brand can organize around.

Second, retailers need to incorporate technology platforms that can support their roadmap and more. They must choose growth and technology partners that help them harness and translate the same brand love they gain from brick-and-mortar shopping experiences into something that exists digitally.

Consider the story of Wingstop, a quick-service restaurant (QSR) chain that once relied on in-store orders but is now finding ways to digitize the experience.

In 2018, Wingstop aspired to increase digital sales from 25 percent to 50 percent of total transactions after recognizing that it needed to think less like a QSR and more like an e-commerce brand. Wingstop took fundamental steps to standardize its POS system menu before rolling out an online ordering system.

By combining the fundamental technology with a custom brand experience early on, Wingstop was primed to succeed during the pandemic. In fact, the brand doubled digital sales to 65 percent of total transactions, and has no plans on stopping. The CEO has announced that Wingstop intends to "digitize every transaction" in the near future — another signal of success. 

To be fair, great brick-and-mortar experiences remain a foundational component of any retailer's playbook. But smart retailers will seize the present opportunities to grow their business digitally, and they'll do so by developing an aggressive roadmap, investing in the right partners, and creating an experience that appeals to digitally native consumers.

Sam Herro is director of client solutions at Hathway, a digital growth partner in the restaurant and convenience store spaces.

Editor's note: The opinions expressed in this column are the author's and do not necessarily reflect the views of Convenience Store News