February 1, 2007
CSD: Convenience Store Shoppers Want … Convenience
By CSD Staff
Through special arrangement, what follows is an excerpt of a current article from Convenience Store Decisions magazine, presented here for discussion.
A comprehensive new study by Meyers Research Center (MRC) finds convenience store shoppers know what they want before they get through the door and are expecting to find cold beverages and friendly employees. The findings are part of Meyers’ Convenience Store Close-Up Wave Six, which takes a look at behavior, attitudes and decision-making patterns of c-store shoppers in the U.S.
“C-Store shoppers are telling us that the helpfulness and the friendliness of the employees was rated high when selecting a store to shop in, along with fast checkout and cleanliness,” said Jeff Friedlaender, Vice President of Meyers Research Center.
Among the key findings of the study was that nearly half of consumers surveyed said they are making sacrifices to pay higher gas prices at the pump.
“Higher gasoline prices are driving consumers to less convenient locations in search of lower prices, which are more important than finding the most convenient c-store,” said Mr. Friedlaender.
Almost half of the subjects (48 percent) said they had to give up something in order to pay higher gas prices over the past summer. Most often relinquished were vacations/travel, dining out/take out and entertainment (movies, theater, ball games). To a lesser extent, people also cut back on shopping, particularly of apparel and DVD movies/games. Two percent said groceries or utility bills were sacrificed.
Employees Outweigh Other Factors in C-Store Selection.
Seventy-five percent of shoppers surveyed said, “Helpful, friendly employees” outweighed factors such as good prices (38 percent), fast checkout (38 percent), wide selection (27 percent) and prepared foods (three percent) when deciding on a c-store to shop in.
Planned Purchases On the Rise — In-Store Influences Declining.
The influence of in-store factors in c-stores has dropped since the study was last conducted in 2004. At that time, in-store factors influenced 12 percent of purchases. The latest numbers show that dropping to four percent. Either there is less being done to spark impulse purchases or tactics being used are less compelling to consumers.
“Convenience store shoppers are making purchasing decisions based on category planning and the role that the c-store plays in their day-to-day activities,” said Mr. Friedlaender.
“Dashboard dining” remains popular. Over 85 percent of products purchased at the c-store are consumed within 30-minutes of checkout and over half within five minutes, usually by the shopper and nobody else. More than half (56 percent) of shoppers said that they plan to consume their purchases in the car while traveling.
Typical Purchases
A cold drink purchase is made by about half of the shoppers — the most typical purchase by far. Shopping for snack food and cigarettes is also highly prevalent. Gas is frequently purchased at stores selling gas; among the shoppers buying merchandise in a c-store with attached gas station, currently 25 percent were purchasing gas, slightly lower than in 2004 (30 percent).
What Drives People To C-Stores?
Purchasing a cold beverage leads the list of destination drivers to c-stores. The purchase of gas and cigarettes also plays a very important role in driving much convenience store traffic. However, presently gas is slightly less of a destination driver to c-stores than in 2004, being replaced by snack food and lottery ticket purchasing.
Discussion Questions: What is your takeaway from the Meyers research? What findings surprised you most?
BrainTrust
Recent Discussions
Discussion Questions
Poll
What surprises me most is that we continue to predict the future with survey results that we consider in context of the past.
Shoppers, shopping habits and shopping needs are changing in response to or as a result of changes in the American lifestyle and value system.
Lifestyle changes are a result of changes in areas such as demographics, standards of living, family structures (single, divorced and alternative families) and household activities and habits.
Value systems continue to fragment with much less homogeneity in values related to groups (church, community, et al), mealtimes (less home preparation, more eating out, fewer “sit down” family events).
Perhaps convenience describes a concept that is much less relevant to today’s consumers than when it was during its inception and heydays. What was once convenience is now a necessity or conversely what was considered appropriate for convenience falls far below today’s expectations.
One may view the problems that mass market retailers, national specialty store chains and Fast Food Restaurants and Convenience Stores are facing as the result of the economy, online shopping, personal debt, global warming, et al.
Maybe instead these are the leading indicators of a larger sea change in consumer expectations and habits. Perhaps the trouble with National anything, be they food, clothing, store or any other brand, is that they are in fact experiencing the rapid fragmentation of the American marketplace as described by the likes of guys like Chris Anderson (The Long Tail) and Seth Godin (Small Is The New Big).
In the case of convenience stores I am of the mind that “smokes and Cokes,” gas and what is passed off as Ready-to-Eat food is falling far short of today’s expectations. The future for these “convenience” stores can be bright but they will require an approach which fulfills the needs of a much different customer. Tesco is launching a much discussed “convenience” store format in California that I believe is much closer to understanding these changes than any other operator today.
The Meyers research for Convenience Store Decisions is based on personal interviews. The research results minimize price as an important issue. Many people being interviewed are embarrassed to admit their price focus. Furthermore, answers are often given based on what the shopper feels will please the interviewer. If price is so unimportant, why does every gas station display the prices so prominently?
I’m in general agreement with other panelists that the Meyer c-store research didn’t really present anything new. However two areas surprised me. One, that a very large % of shoppers pre-plan their purchases and are not impulse buyers. My take on this is that convenience store operators may not be effectively using merchandising tools (cross-merchandising, promotion, POS, counter displays, etc.) to generate additional shopper purchases. Two, there is no mention of behavior, attitudes and decision-making for ethnic shoppers. Perhaps this is beyond the scope of the research but in many markets, Latino customers in particular, represent a significant % of store traffic. While they are visiting c-stores for many of the same reasons as “anglos” (snacks, gas, cigarettes, lottery tickets) they are a different customer segment, bring a different mindset to in-store purchases and offer a revenue opportunity for convenience stores.
The research results are really not surprising. Shoppers want convenience without giving up friendliness, cleanliness and service. We mystery shop thousands of convenient stores. These are the areas that come under the most scrutiny from management. These are the areas that they are always trying to improve. They are the business drivers! The other area that is scrutinized as well is the compliance with underage laws and carding for the sale of tobacco, alcohol and lottery tickets.
It is well established that most consumer shopping trips today are quick trips for a few items. Of course, consumers want convenience, but this does not mean that convenience stores are always the choice.
Retailers of all types are engaged in a major battle to capture these trips. Drug stores are trying to become the “convenience store for women” because they now carry consumables in addition to other items women seek. Dollar stores are expanding their value proposition by carrying milk, bread and other convenience consumables. Surprisingly, we even find that over a third of all shopping trips to supercenters are quick trips.
The Meyers Research study confirms many of the findings of a study Dechert-Hampe & Co. conducted with Wrigley, Masterfoods, Time-Warner and several Convenience Store chains.
The DHC study suggested that Convenience stores also need to focus on building the transaction size of their shoppers by leveraging impulse categories. For instance, we found that the most common trip triggers were beverages, cigarettes, and food service. A key opportunity is to sell a complementary item to the shopper. Often, this is a candy, gum, or snack. The study found that the the rate of candy and gum purchases could be significantly increased by merchandising them at key locations in the store.
The real value of the research is not just what consumers say they want, but the development of new insights to behavior that lead us to new in-store solutions.
Another issue to look at in terms of in-store influencers is the role of manufacturers’ product promotions. Are the companies promoting their products at the same levels as they used to? Are distributors and sales reps supporting those promotions, and is the store management participating, at the regional level and the location level?
It may be that marketers and retailers need to find new incentives that will mean more to location-level merchandisers, who can then take the message to store employees and, ultimately, the customer.
Or, are the promotions still there–only more so–so that every aisle is jammed with some sort of marketing message competing for the customer’s limited time and attention? In that case, it may not be a matter of increasing participation but of store management needing to be more selective about what they’ll promote, to streamline the experience for the customer.
In turn, that could mean that marketers need to come up with a more environmental approach, finding a way to control more of a display area and thus quiet the noise the customer has to move through.
Either way, it sounds as if something about the promotional landscape in-store needs to change, and retailers need to get the help they need from the folks who brand the products.
As stated above, there is really nothing new in the survey and I think most of us feel that way because it supports our own views that the key to getting return business is good customer service. I would like to go beyond that and say that the thing that will really bring customers back, no matter what the price, is superior customer service. I think we then need to define superior customer service even in a C-store environment.
People want to do business with people they like and people that take the time to recognize them as individuals and not as numbers. As I have said in training sessions for years, the number one trait in a great convenience store associate is that they like to pick on their customers. They know who they can pick on and when. Those customers they pick on keep coming back for more. It won’t even matter what the cost of their gas is.
The important thing to understand within any store is what the destination categories are for the store–which categories do consumers drive there specifically to purchase? Drinks, cigarettes, confection, lottery tickets and salty snacks may be some of the destination categories.
Then you have to try to create “triggers,” using these destination categories, to get consumers to purchase other products/categories when they are in the store. This is done through strategic store layout and in-store merchandising.
The convenience retailer that can come up with the right in-store merchandising formula will succeed. And apparently helpful staff makes a difference too (but is this really important when you’re buying a Slurpee?).
I’m with the gang. The research points to the obvious. The real opportunity lies beneath their report.
Why is in-store influence down? Are the merchandising and store design strategies not where they should be? What could be done better? What WOULD motivate people to go out of their way to convenience shop that isn’t obvious to us? What other “convenience needs” are out there that are opportunities to take the c-store experience to the next level?
These are the kinds of questions that would have stirred up the industry. As a consumer, I have an opinion for all of these things…as I’m sure we all do. Round 2 Meyers???
Jumping on board with what has been shared already by Charles and Ryan…having NOT seen the survey or methodologies used here, I am RATHER suspicious of the interpretations. First, it appears that this is a prompted survey–which means you ONLY get answers to the questions you asked and are forcing them to choose from a list of responses…therefore, you only get what you expected.
Secondly, the interpretation seems contradictory…in-store influences are down and helpful clerks are up (Ryan’s point here is spot on accurate…”as compared to what–UNhelpful clerks???”)–well MAYBE it is because the in-store influences are decreased that you NEED even more helpful clerks (because the shopper is not certain of what is where in the store–as small as it is…it may still confuse the shopper).
I want to reserve judgment because I have not seen the study, but it strikes me as poor science, sloppy research, and a bunch of breathing in our own exhaust…but maybe I am just in a bad mood and am being overly critical of what seems to be “same old, same old.”
I don’t see anything new here but rather a confirmation of what we already know. The majority of people expect to pay more for things in a C-store, but gas currently isn’t one of them. Last summer’s high gas prices have raised everyone’s awareness of this issue and consequently, more people are willing to drive a little further out of their way to save. And while we are willing to pay extra for convenience, we don’t have to accept employees with bad attitudes or filthy stores.
At the risk of offending market researchers everywhere, this study seems to reconfirm the obvious. One assumes that very few people go to a c-store to get lost in the dizzying display of merchandise or bathe themselves in a universe of undreamed of retail possibilities. More likely they are there for gas, a cold Coke, a pack of cigarettes or a gourmet meal that can be eaten one-handed while navigating through traffic at 60 miles per hour. Does it help that the people working the store are friendly…of course, what’s the alternative position? Perhaps next we’ll see research that will tell us that people who shop liquor stores tend to drink more alcohol than those who don’t.
(Note to Ryan: Don’t rent a car in Chicago. People driving 60 mph on our expressways are required to carry a precertified death certificate and precut tombstone in their trunks to speed clearing the highway during rush hour.)
On to c-store research.
One take on this research is that “channel blurring” is starting to wear thin with consumers. We may not be heading back to the days when “meaningful differentiation” meant calling yourself a “hardware store”–and that was where you went to buy a hammer. But it is clear that consumers have pegged what a “convenience store” is to them and that’s that. The good thing is that retailers are still finding ways to expand their offerings within that position. Expanding “snacks” into “portable foods” into “fresh prepared foods to go” is a great example. Just be sure to consume them while observing the flow of traffic, err…I mean the speed limit, of course!
C-stores provide convenience to consumers. They have never been the least expensive source of anything. Their financial health is highly dependent on contracts from Tobacco companies which will go away in time. Any c-store operator should look at this traffic and determine what else he can do to extract money and profit from their pockets. One possible source of revenue would be audio book sales/rentals. DVD sales/rentals. The sale of quality frozen meals (like Bertolli). Another thing they could do is work on some sort of real loyalty program. The fact of the matter is that c-stores utilize computers totally for control of cost. Efforts should be made to utilize the strength of computers to encourage consumers.
More Discussions
Is Five Below Poised For Even Greater Growth?
Five Below is hitting serious growth numbers. Can this trend continue?Should IKEA Be Flattening Management?
Should IKEA be trimming down its management headcount?Is Legislation the Answer on Visa, Mastercard Swipe Fees as ~$200 Billion Record Is Set?
Is lawmaking the way forward on swipe fees?
What surprises me most is that we continue to predict the future with survey results that we consider in context of the past.
Shoppers, shopping habits and shopping needs are changing in response to or as a result of changes in the American lifestyle and value system.
Lifestyle changes are a result of changes in areas such as demographics, standards of living, family structures (single, divorced and alternative families) and household activities and habits.
Value systems continue to fragment with much less homogeneity in values related to groups (church, community, et al), mealtimes (less home preparation, more eating out, fewer “sit down” family events).
Perhaps convenience describes a concept that is much less relevant to today’s consumers than when it was during its inception and heydays. What was once convenience is now a necessity or conversely what was considered appropriate for convenience falls far below today’s expectations.
One may view the problems that mass market retailers, national specialty store chains and Fast Food Restaurants and Convenience Stores are facing as the result of the economy, online shopping, personal debt, global warming, et al.
Maybe instead these are the leading indicators of a larger sea change in consumer expectations and habits. Perhaps the trouble with National anything, be they food, clothing, store or any other brand, is that they are in fact experiencing the rapid fragmentation of the American marketplace as described by the likes of guys like Chris Anderson (The Long Tail) and Seth Godin (Small Is The New Big).
In the case of convenience stores I am of the mind that “smokes and Cokes,” gas and what is passed off as Ready-to-Eat food is falling far short of today’s expectations. The future for these “convenience” stores can be bright but they will require an approach which fulfills the needs of a much different customer. Tesco is launching a much discussed “convenience” store format in California that I believe is much closer to understanding these changes than any other operator today.
The Meyers research for Convenience Store Decisions is based on personal interviews. The research results minimize price as an important issue. Many people being interviewed are embarrassed to admit their price focus. Furthermore, answers are often given based on what the shopper feels will please the interviewer. If price is so unimportant, why does every gas station display the prices so prominently?
I’m in general agreement with other panelists that the Meyer c-store research didn’t really present anything new. However two areas surprised me. One, that a very large % of shoppers pre-plan their purchases and are not impulse buyers. My take on this is that convenience store operators may not be effectively using merchandising tools (cross-merchandising, promotion, POS, counter displays, etc.) to generate additional shopper purchases. Two, there is no mention of behavior, attitudes and decision-making for ethnic shoppers. Perhaps this is beyond the scope of the research but in many markets, Latino customers in particular, represent a significant % of store traffic. While they are visiting c-stores for many of the same reasons as “anglos” (snacks, gas, cigarettes, lottery tickets) they are a different customer segment, bring a different mindset to in-store purchases and offer a revenue opportunity for convenience stores.
The research results are really not surprising. Shoppers want convenience without giving up friendliness, cleanliness and service. We mystery shop thousands of convenient stores. These are the areas that come under the most scrutiny from management. These are the areas that they are always trying to improve. They are the business drivers! The other area that is scrutinized as well is the compliance with underage laws and carding for the sale of tobacco, alcohol and lottery tickets.
It is well established that most consumer shopping trips today are quick trips for a few items. Of course, consumers want convenience, but this does not mean that convenience stores are always the choice.
Retailers of all types are engaged in a major battle to capture these trips. Drug stores are trying to become the “convenience store for women” because they now carry consumables in addition to other items women seek. Dollar stores are expanding their value proposition by carrying milk, bread and other convenience consumables. Surprisingly, we even find that over a third of all shopping trips to supercenters are quick trips.
The Meyers Research study confirms many of the findings of a study Dechert-Hampe & Co. conducted with Wrigley, Masterfoods, Time-Warner and several Convenience Store chains.
The DHC study suggested that Convenience stores also need to focus on building the transaction size of their shoppers by leveraging impulse categories. For instance, we found that the most common trip triggers were beverages, cigarettes, and food service. A key opportunity is to sell a complementary item to the shopper. Often, this is a candy, gum, or snack. The study found that the the rate of candy and gum purchases could be significantly increased by merchandising them at key locations in the store.
The real value of the research is not just what consumers say they want, but the development of new insights to behavior that lead us to new in-store solutions.
Another issue to look at in terms of in-store influencers is the role of manufacturers’ product promotions. Are the companies promoting their products at the same levels as they used to? Are distributors and sales reps supporting those promotions, and is the store management participating, at the regional level and the location level?
It may be that marketers and retailers need to find new incentives that will mean more to location-level merchandisers, who can then take the message to store employees and, ultimately, the customer.
Or, are the promotions still there–only more so–so that every aisle is jammed with some sort of marketing message competing for the customer’s limited time and attention? In that case, it may not be a matter of increasing participation but of store management needing to be more selective about what they’ll promote, to streamline the experience for the customer.
In turn, that could mean that marketers need to come up with a more environmental approach, finding a way to control more of a display area and thus quiet the noise the customer has to move through.
Either way, it sounds as if something about the promotional landscape in-store needs to change, and retailers need to get the help they need from the folks who brand the products.
As stated above, there is really nothing new in the survey and I think most of us feel that way because it supports our own views that the key to getting return business is good customer service. I would like to go beyond that and say that the thing that will really bring customers back, no matter what the price, is superior customer service. I think we then need to define superior customer service even in a C-store environment.
People want to do business with people they like and people that take the time to recognize them as individuals and not as numbers. As I have said in training sessions for years, the number one trait in a great convenience store associate is that they like to pick on their customers. They know who they can pick on and when. Those customers they pick on keep coming back for more. It won’t even matter what the cost of their gas is.
The important thing to understand within any store is what the destination categories are for the store–which categories do consumers drive there specifically to purchase? Drinks, cigarettes, confection, lottery tickets and salty snacks may be some of the destination categories.
Then you have to try to create “triggers,” using these destination categories, to get consumers to purchase other products/categories when they are in the store. This is done through strategic store layout and in-store merchandising.
The convenience retailer that can come up with the right in-store merchandising formula will succeed. And apparently helpful staff makes a difference too (but is this really important when you’re buying a Slurpee?).
I’m with the gang. The research points to the obvious. The real opportunity lies beneath their report.
Why is in-store influence down? Are the merchandising and store design strategies not where they should be? What could be done better? What WOULD motivate people to go out of their way to convenience shop that isn’t obvious to us? What other “convenience needs” are out there that are opportunities to take the c-store experience to the next level?
These are the kinds of questions that would have stirred up the industry. As a consumer, I have an opinion for all of these things…as I’m sure we all do. Round 2 Meyers???
Jumping on board with what has been shared already by Charles and Ryan…having NOT seen the survey or methodologies used here, I am RATHER suspicious of the interpretations. First, it appears that this is a prompted survey–which means you ONLY get answers to the questions you asked and are forcing them to choose from a list of responses…therefore, you only get what you expected.
Secondly, the interpretation seems contradictory…in-store influences are down and helpful clerks are up (Ryan’s point here is spot on accurate…”as compared to what–UNhelpful clerks???”)–well MAYBE it is because the in-store influences are decreased that you NEED even more helpful clerks (because the shopper is not certain of what is where in the store–as small as it is…it may still confuse the shopper).
I want to reserve judgment because I have not seen the study, but it strikes me as poor science, sloppy research, and a bunch of breathing in our own exhaust…but maybe I am just in a bad mood and am being overly critical of what seems to be “same old, same old.”
I don’t see anything new here but rather a confirmation of what we already know. The majority of people expect to pay more for things in a C-store, but gas currently isn’t one of them. Last summer’s high gas prices have raised everyone’s awareness of this issue and consequently, more people are willing to drive a little further out of their way to save. And while we are willing to pay extra for convenience, we don’t have to accept employees with bad attitudes or filthy stores.
At the risk of offending market researchers everywhere, this study seems to reconfirm the obvious. One assumes that very few people go to a c-store to get lost in the dizzying display of merchandise or bathe themselves in a universe of undreamed of retail possibilities. More likely they are there for gas, a cold Coke, a pack of cigarettes or a gourmet meal that can be eaten one-handed while navigating through traffic at 60 miles per hour. Does it help that the people working the store are friendly…of course, what’s the alternative position? Perhaps next we’ll see research that will tell us that people who shop liquor stores tend to drink more alcohol than those who don’t.
(Note to Ryan: Don’t rent a car in Chicago. People driving 60 mph on our expressways are required to carry a precertified death certificate and precut tombstone in their trunks to speed clearing the highway during rush hour.)
On to c-store research.
One take on this research is that “channel blurring” is starting to wear thin with consumers. We may not be heading back to the days when “meaningful differentiation” meant calling yourself a “hardware store”–and that was where you went to buy a hammer. But it is clear that consumers have pegged what a “convenience store” is to them and that’s that. The good thing is that retailers are still finding ways to expand their offerings within that position. Expanding “snacks” into “portable foods” into “fresh prepared foods to go” is a great example. Just be sure to consume them while observing the flow of traffic, err…I mean the speed limit, of course!
C-stores provide convenience to consumers. They have never been the least expensive source of anything. Their financial health is highly dependent on contracts from Tobacco companies which will go away in time. Any c-store operator should look at this traffic and determine what else he can do to extract money and profit from their pockets. One possible source of revenue would be audio book sales/rentals. DVD sales/rentals. The sale of quality frozen meals (like Bertolli). Another thing they could do is work on some sort of real loyalty program. The fact of the matter is that c-stores utilize computers totally for control of cost. Efforts should be made to utilize the strength of computers to encourage consumers.