These Guys Want to Take the C-store Business

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These Guys Want to Take the C-store Business

By Chelsea Regan, Convenience Store News - 07/19/2017

PHILADELPHIA — GoPuff co-founders Rafael Ilishayev and Yakir Gola don't think today's convenience stores are all that convenient. Enter their millennial-targeted service that brings convenience store items right to a customer's door.

Illishayev and Gola started conceiving GoPuff in college when they found themselves in want of such a service. “All the existing on-demand delivery services took way too long or were way too expensive, and convenience stores as a whole were slated for disruption,” Illishayev told Convenience Store News.

Delivery also removes the “judgment factor,” he explained. “Nationally, convenience stores’ AOV [average order value] is roughly five or six bucks. Ours is five, six times that. Reason being is that there’s an anonymous factor to it. I can order four, five pints of ice cream and a bag of chips and some drinks, and it’ll be delivered to me at the same price for only two bucks,” Illishayev added. 

When GoPuff started out in the Philadelphia market, the service had just 50 products on its roster — popular candy, drinks, and household items. Now, the company is offering an average of 1,800 to 2,000 SKUs across 20 markets, including Boston, Washington, D.C., Austin, New York, Denver, Phoenix, Seattle, Chicago and Portland.  

“We’re not wanting to increase it too much anymore, but really optimize what people are looking for, and discontinuing the things that people don’t want,” said Illishayev, who indicated that he and Gola see the most potential for growth in expanding GoPuff’s delivery of alcohol across all markets. “We have alcohol in roughly 50 percent of our markets. We want to get that as close to 100 percent as soon as possible because we want to make sure GoPuff is a consistent experience everywhere you go.”

Today, it’s not unheard of for a service to conveniently deliver items to a shopper's home, including items that one might associate with a convenience store. However, GoPuff’s founders believe that what they’re offering is superior for two main reasons: speed and brand affinity.

“Our average delivery time is 23 minutes. No one even comes close on a national basis,” said Ilishayev. As for the brand, “If you do a simple Twitter search or just check any social channel for that matter and you write in 'Prime Now' and then you enter 'GoPuff,' you’ll really see the emotional attachment people have with GoPuff, saying ‘GoPuff is my best friend’ or ‘GoPuff is my significant other’ or ‘GoPuff is better than my parents.’”

A third point, underscored by the company's emphasis on delivery time and brand affinity, is GoPuff’s commitment to catering to the millennial consumer — something its founders believe traditional c-stores have yet to master.

“It’s very important that the way we position ourselves in the world is extremely focused. Some people say you have to go chase out volume, make sure you appeal to everyone. We’re not Amazon; we’re not A to Z. We’re a replacement to a convenience store,” explained Ilishayev. “By being good, by being focused on this millennial market, we start dripping and spilling over to other demos we never thought would love GoPuff as much as they do today.”

Ilishayev and Gola plan on expanding GoPuff to an additional 12 markets by year’s end, and continuing to be industry disrupters.

“Excluding Wawa, convenience stores have no idea what they’re doing on how to really re-attract the millennial customers. Some of them are just focusing on millennial-focused products, or they really want to get people in-store. And that’s really not the way the landscape is trending,” said Illishayev. “We really want to make sure we’re at the forefront of disrupting this convenience industry that’s really been set up for disruption in the last half-decade."