Convenience stores need to adapt their businesses to meet changing shopper behaviour and needs, according to Mike Greene, CEO at research company Him.
Presenting insights from Him’s Convenience Tracking Programme at the IGD’s Convenience Retailing 2011 conference on 10 November 2011, Greene urged delegates to “do things differently”.
Shoppers change by time of day, he said, and they want personalisation and targeted mail.
Greene highlighted a promotion in Australia in which Coca-Cola took the country’s 150 most popular names and put them on coke bottles with a “share a coke with…” strapline. It was creative and fun and drove double digit growth, said Greene.
Similarly in the US, the convenience chain Rutter’s offers personalisation in its coffee offer with a wide range of variants, syrups and toppings. Conversely, the choice of coffee in UK c-stores is limited to one, said Greene.
Health and wellbeing is becoming increasingly important but shoppers don’t believe the convenience sector does a good job in this area, said Greene.
And, he warned the convenience market would be hit harder by potential government legislation in areas such as tobacco, BWS and snacks, than other grocery formats.
C-stores should address what Greene termed life stage complexity ie the growing number of single person households and an ageing population. They should consider offering meals for one, for example.
Supermarket entry into the convenience sector has been beneficial, argued Greene.
The convenience market has improved because people have had to pull up their socks, he said.
Greene highlighted the new M-local format as a standout convenience offering.
The focus on fresh was impressive and it has an abundant and credible fresh meal for tonight offer, he said. Innovations include peel off recipes; dine in for two for £9.00 promotions; and a simple meal deal offer, where shoppers can select any a, b or c product and the cheapest is free.
M-local also offers coffee and fresh juice and has an extensive BWS offer featuring a wine selector and glass loans. It also promotes local products and effectively cross merchandises non-food lines such as celebrity cook books. Alongside strong marketing and price messaging, Morrisons also promises to have any products, which are available in its larger supermarkets in the M-local stores by 5pm.
Technology is growing in importance and one third of shoppers want offers on their mobile phone, said Greene.
“The ROI on social media is whether you will still be in business in five years,” he said.
According to Greene, mobile technology, such as proximity marketing, will change shopping habits; and he queried why more c-stores were not developing their own apps.
Despite the trend to value, quality is still important, according to Him.
POS should be dynamic, claimed Greene.
“If it does not move, it will not be seen,” he said. Greene urged c-stores to merchandise stores in zones with ranging by shopping mission and called for more innovation.
“74% of people want c-stores to stock more inspiring products and c-stores need to make it easy for people to make informed choices,” he said.