Convenience or Inconvenience? That’s the Question.
The great and good of the convenience world (and yours truly) recently gathered in London for the NACS Insight Convenience Summit Europe. I also had the privilege to judge the International Convenience Retailer Awards that are linked to this event. The overall vibe was upbeat – people are feeling positive about the journey their brands are undertaking.
It’s an understatement to say that convenience is a broad sector – some say it’s worth US$575 billion (or more) annually, and 1 in 2 shoppers use a c-store everyday. These days convenience encompasses everything from motorway services and c-stores through to pharmacies and quick-service/fast-casual dining – and much more. Everyone is seemingly jumping on the convenience bandwagon – even car manufacturers like Ford and Hyundai are moving into shopping malls.
Innovate or die
In some ways, this sector is a little more immune to the game-changing activity we’re seeing in other retail sectors – by its very nature a lot of convenience is unplanned and impulsive. But shopping habits are changing and people want different things, so convenience mustn’t rest on its laurels.
In terms of c-stores, there are lots of invaders to this territory – 26% might be owned by big multiples but the Food-to-Go Retailer of the Year at The Grocer Gold Awards this year was none other than bakery chain Greggs! As entrepreneur Mike Greene said: “Fresh used to be the icing on the cake – now it is the cake!”
Symbol groups and traditional c-stores need to look at their proposition and make sure that it fits with changing customer lifestyles. I’m not just talking about adding some fake brick work to the environment to make it feel cosy – they need to truly revolutionise they way they approach things. Many that are doing so already are transitioning to a grocerant model – a hybrid of grocery stores and restaurants with a huge emphasis on food for now/food to go.
Shoppers also want cool places that have attitude to spend time in – and those who take a seat spend up to 40% more. UK convenience store symbol group Simply Fresh is leading the way in this approach, and founder managing director Kash Khera summed it up perfectly by saying: “Fresh food is the new rock and roll.”
Foodservice is the future
Healthy and wellbeing chains like Freshii are seeing huge growth. It’s now got 300 stores in 16 countries. A ‘Zara-like’ model focuses on regular innovations and ‘newness’ that are nutritionist-led, bringing fresh healthy food trends to the masses. Freshii itself uses the fashion analogy, believing that fashion creates change – it doesn’t just react or find itself being forced to change.
Another recurring theme was personalisation of in-store service and products, combined with localisation of stores – like family-owned Max Burgers from Sweden that has a special approach to franchising.
Germany’s Edeka has nothing to do with the supermarkets we’ve always known – it’s firmly embracing foodservice convenience with its eatery areas, coffee shops and strategic alliances. And lets not forget about Amazon – it’s recent acquisition of Whole Foods will make it a force to be reckoned with when it leverages its tech prowess and pre-existing Amazon Go and Amazon Fresh offers with that of Whole Foods.
And the winner is…
I was thrilled to be asked to judge the NACS Insight Convenience Retailer of the Year Award. All worthy contenders, the shortlist of 10 stores demonstrates how to get new ideas out there. But the stand out entry – and eventual winner – was Spar Natural Gran Canaria. It’s a total rethink around health and wellbeing, with a particular understanding that its people are a critical part of the store’s success. This stood out for me, as neither the event nor the entries I judged seemed to focus much on staff investment and interaction, beyond the basics of ‘friendly service’.