Will Convenience Retail Be Forever Changed by COVID-19?

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Will Convenience Retail Be Forever Changed by COVID-19?

By Renée M. Covino, Convenience Store News - 08/17/2020

NATIONAL REPORT — Oh, what a difference a global pandemic can make — on everything.

Even before the pandemic, retail was in the midst of a digital transformation, but now the industry is “in hyper-drive to cater to new needs,” said Randy Evins, industry advisor, food, drugstore and convenience, for retail software provider SAP.

Consumers who previously preferred the in-store experience are now buying products online. As a result, online shopping has increased well beyond its predictions for 2030 already, which could have long-term implications on how retail brands interact with consumers, noted Evins.

The COVID-19 crisis is also forcing operators to think of ways they can make themselves even more efficient, while ensuring consumer safety. Technological innovations are crucial now — not only for future success, but also to balance the negative implications of the current environment.

Over the coming months, retailers will need to prepare for the continued and, probably even swifter, move to mobile. “Mobile wallet adoption was already on the rise before the crisis, with the potential to generate billions in the U.S. by 2021,” noted Brett Narlinger, senior vice president of global commerce for Blackhawk Network, which delivers branded payment programs. “Although there will still be a disconnect between digital payments and in-store point-of-sale at many retailers, I suspect adoption will increase at a much faster rate as we start to emerge from this crisis.”

An increased demand for delivery is also part of the retail shift underway now.

“As we see more and more consumers start to experiment with home delivery for items like groceries and home supplies out of necessity, we’re finding that they’re adjusting to it fast,” said Marc Gorlin, founder and CEO of crowdsource delivery service Roadie. “But if you think about it, it’s not that new of an idea; we used to have visits from the milkman, the ice man, the egg man — all of those items used to show up on our doorsteps. So, in a way, home grocery delivery is a return to our roots as much as it is something new and modern.”

The Sticking Points

There’s no doubt that the coronavirus is shaping new consumer behaviors. Retail industry experts believe that many of these new behaviors will stick around for some time, such as:

  • Consuming most/all food at home.
  • Ordering food/beverages/groceries online.
  • Seeking experiences that bridge the physical and digital channels such as BOPIS (buy online, pickup in store) and curbside pickup.
  • Utilizing the growing number of home delivery services.
  • Consolidating/severely limiting trips to brick-and-mortar stores.
  • Visiting large-format stores only when in need of 10 items or more.
  • Valuing frictionless interactions and services.
  • Responding to promotions through smartphones and other mobile devices.
  • Washing hands constantly.
  • Carrying PPE (personal protective equipment), such as hand sanitizer, disinfecting wipes and masks, as a matter of habit.

Pre-pandemic, the c-store industry was slow to adopt digital practices, according to Evins. But now, convenience and safety are tied together as “musts.” This is driving convenience stores to offer new services such as home delivery, pumpside pickup, drive-thru and more.

And now that consumers know this is a possibility, it will be expected going forward.

If they haven’t already done so, convenience stores must invest in hands-free digital elements — such as click-and-collect, contactless payment, and curbside pickup — to maintain their convenient edge in the new economy, advises Bobby Greenberg, senior vice president of strategy and analytics at Kobie, which designs and develops solutions to drive customer loyalty.

Data holds the key to convenience stores being able to respond to all of the changing consumer behaviors, according to John Nash, chief marketing and strategy officer at Redpoint Global, a CX software provider. “Retailers should be investing in Customer Data Platform (CDP) technology that can help them create a single view of customers and enable them to orchestrate seamless, personalized and real-time experiences,” he said.

Having an always up-to-date, comprehensive record of each customer will ensure c-stores can provide timely and relevant suggestions, offers and communications.

“By delivering value at every interaction, retailers demonstrate that they understand each customer as an individual,” Nash stated. “Personalization will continue to be key to the customer experience, even more so during and following COVID-19. Implementing tools that will help deliver a dynamic customer journey is no longer an option; it’s a necessity.”