Warehouse Clubs & Grocers See Fuel Market Share Gains as Consumers Seek One-Stop Shop

NPD: These high-volume retailers captured 20 percent share last year — an all-time high.

NEW YORK — The COVID-19 pandemic has fundamentally altered how consumers commute and limit their daily activities.

According to the Motor Fuels Index from The NPD Group, U.S. consumers decreased their fuel-buying visits and became more focused on the one-stop shop in 2020 as a result of the coronavirus. Overall, visits among fuel buyers dropped from an average of 4.2 per month in 2019 to 3.6 in 2020, but the average number of gallons per buyer increased slightly.

Amidst these changes, retailers such as warehouse clubs and grocery stores saw significant fuel market share gains as consumers not only stocked up on household items and groceries, but as they purchased fuel. These high-volume retailers were gaining traction in the fuel market in 2019, but the pandemic helped to accelerate that trend, capturing 20 percent share of the U.S. fuel market in 2020 — an all-time high.

"The pandemic has upped the ante on the importance of the consumer experience across all of retail, and the motor fuels market is experiencing this shift as fuel buyers look to get more from their shopping trips," said Nathan Shipley, NPD's automotive analyst. "While there will be an evolution as the consumer enters the next stage of 'normal,' pandemic-driven behaviors will continue to play a role in motor fuel purchase decisions."

Last year, fuel buyers were also more likely to use other services at the high-volume retailers they visited, including the grocery store, the ATM and fast-food restaurants. This kind of one-stop-shopping gained appeal as consumers looked to limit their public exposure during the height of the pandemic, but it also couples well with road-trip preparation that will be happening this year, NPD reported.

The agency's Motor Fuels Index reveals 2020 sales growth exceeding 20 percent in towing and cargo management categories that often tie to travel and road trips. These are investments that signal an opportunity to reverse last year's 13.2 percent decline in miles driven.

"The road ahead looks different, with a new set of opportunities to engage the motor fuel consumer," added Shipley. "The daily commute is not expected to get back to pre-pandemic levels, but the increasing popularity of road trips will help improve the number of miles driven, bringing a generally positive outlook to the fuel and automotive aftermarket in 2021."