Tobacco’s 2020 Trajectory

June 9, 2020

Great article from CStore Decisions. A bit lengthy but there is some great information here. Nice @Nielson information also.


Rising sales are boosting retailer optimism across the category, but regulatory hurdles loom.

Tobacco sales have proved a bright spot for many convenience stores during the COVID-19 pandemic, but while c-stores anticipate robust tobacco sales for the remainder of 2020, retailers are bracing for the potential chill of regulatory headwinds.

As the pandemic first hit the U.S., many customers began hoarding tobacco products — particularly cartons of cigarettes — ahead of shelter-in-place rules, according to data from the InfoMetrics database managed by consulting services firm Management Science Associates (MSA).  

“As the stay-at-home situation has continued, there has been increased consumption of all types of tobacco items with the exception of vape, possibly because consumers are at home and not in locations where there are restrictions on its use,” said Don Burke, senior vice president of MSA.  

A poll by consumer intelligence research platform CivicScience found that from April 28 to May 11 — at a time when most areas of the country were still experiencing stay-at-home orders — 31% of cigarette users reported smoking more frequently, and 28% of e-cigarette/vape users reported vaping more frequently. Some 44% of cigarette smokers and 34% of smokeless, e-cig and cigar users reported buying their tobacco product at a c-store most often during the same period. 

Research firm IRI’s Convenience All Scan data found smokeless tobacco dollar sales grew 7.8%, with spitless up a whopping 80.6% for the four weeks ending April 19, 2020. Tobacco accessories dollar sales were up 33%, and cigars climbed 13.1%, while cigarettes dropped 2.4%, and e-cigs dipped 1.1% for the same period. Nielsen data showed e-cigs down 8.5% and cigarettes down 5% for the four weeks ending April 25, 2020, but similar upticks in other tobacco products, with cigars up 11.3%, pipe tobacco up 14.1% and “shag” or rolling tobacco up 28%. 

Depending on location, c-store retailers are seeing various realities and differing surge/decline timelines when it comes to tobacco sales. 

Store-Level View

Doug Galli, vice president and general manager for Reid Stores and Crosby’s, said sales of other tobacco products (OTP) including cigars, snuff and e-cigarettes climbed at the company’s 82 c-stores in New York and Pennsylvania, ahead of shelter-in-place rules. 

Year over year through April, “cigars are up 7%, e-vape is up 29% and the ZYN/Velo category that was non-existent last year has shown some legs. That category is 50% of the lift over last year,” Galli said. He added that moist snuff was down slightly for the same period.  

On Feb. 6, 2020, the Food and Drug Administration (FDA) ruled that c-stores and other retailers can no longer carry display cartridge-based e-cigs or vaping pods in flavors other than menthol and tobacco, but flavored disposable e-cigarettes are still legal. 

“The FDA attempted to strike a balance between protecting adult access to flavored vaping products and discouraging youth from vaping,” noted Gregory Conley, president of the American Vaping Association. “Unfortunately, this move has undoubtedly led some adult ex-smokers to relapse and less adult current smokers to attempt to switch over.” 

The growth seen at Crosby’s c-stores is “in spite of the (federal) flavor ban in (non-disposable) e-cigs and vape products, along with the addition of the ZYN/Velo products,” Galli added. 

The cigarette segment, meanwhile, has been down 10% at Crosby’s c-stores through April, a slump Galli attributed to the purchase age for cigarettes increasing from 18 to 21 on Nov. 1, 2019, in New York state. Shortly thereafter, on Dec. 27, 2019, the FDA officially changed the minimum tobacco purchase age at the federal level from 18 to 21. The new nationwide Tobacco-21 law was effective immediately and applies to all tobacco products, including e-cigarettes and vaping cartridges.

Across the country, Cenex Zip Trip saw a different trajectory at its 36 c-stores in Montana, Wyoming, North Dakota, South Dakota and Minnesota. 

“While early March and April saw a small decrease in tobacco sales during the heart of the stay-at-home orders in the states we serve, in the past three weeks, we’ve seen them rise back similar to what we sold during the same time span a year ago,” said Zip Trip Merchandising Manager Jon Fleck. 

Montana — where the majority of Zip Trip’s stores are located — is now transitioning into the next phases of loosening stay-at-home restrictions, but during the lockdown, despite decreased customer traffic, the tobacco category held its own, Fleck said. 

Fleck noted tobacco companies are offering bigger buydowns and providing them earlier than planned. “With advertising these deals with outdoor signs and matrix reader boards, we have seen some (sales) come back,” Fleck said. 

At the end of 2019, a temporary ban on flavored vape products — including menthol — went into effect in the state of Montana. “We did a tremendous business in Montana with flavors prior to the ban,” Fleck said. 

The ban on menthol, however, expired in mid-April, and the chain is now bringing in some flavored disposable e-cigs. 

Given the Montana flavor ban, Zip Trip has seen a 20% drop in e-cig sales. Although the e-cigs/vaping segment is down significantly because of flavor bans, Fleck noted, “the category is doing well as a ‘comfort product’ along with beer during this pandemic.”   

Meanwhile, chew, snuff and cigars are down slightly — “which isn’t bad considering the drop in customer counts (due to the pandemic),” said Fleck. “We categorize tobacco alternatives with these products as well. ZYN, Dryft, etc., have been a pleasant surprise that has picked the overall category up.”

At Zip Trip, tobacco customers are asking for specials, and seeking “the bigger, better deal.” “Similar to beer, cigarettes are comfort products, so while we did a small decrease in business during this time versus the prior year, we attribute most of that to the smoking age increasing to 21 as opposed to COVID-19,” Fleck said. 

Meanwhile, in Texas, Irfan Tejani, CEO and president of Tejani Holdings, the parent company of Charge Up c-stores, said COVID-19 had a big impact on tobacco sales. 

“Sales were down all across the board by double digits as customers did not know how to react to the entire situation, and then we started to get momentum back,” he said. 

Headquartered in Sugar Land, Texas, Charge Up operates 40 c-stores in Texas and Louisiana. 

“Louisiana stores specifically had to adapt to operating during a strict lockdown,” Tejani said. Overall, he noted that “despite the ongoing restrictions, the cigarette category remains the highest grosser all across (our stores).” 

Smokeless tobacco has been stagnant to growing at Charge Up, depending on the location, while cigarillos are “very strong,” particularly the single sticks, which Tejani noted offer good profit margins. What’s more, he sees cigarillo sales growing — “especially the singles and promo packs like 3-for-1 and 4-for-1 packs,” Tejani said. 

Charge Up is also testing the oral nicotine category. Nicotine toothpicks are sold at select stores. 

“It’s a special category that doesn’t sell across the board,” he said. “Nicotine gums seem to be doing good where this category is sold.”

Tejani, Fleck and Galli all anticipate strong sales for tobacco for the rest of 2020. 

“Tobacco in our New York stores is about to grow. Effective May 18, if your retail location has a pharmacy, you will not be allowed to sell tobacco products,” Galli said. Crosby’s stores in Erie County, N.Y., experienced a lift in their tobacco sales when an identical rule went into effect there around a year ago.

Tejani said he believes the tobacco category will continue to stay strong and consistent over the coming years — unless regulations become even stricter — with e-cigs slowly taking over a bigger portion of the category. Despite ongoing regulations, customer needs drive the market, and customers continue to demand tobacco sales, he pointed out. 

“We see tobacco numbers increasing the rest of the year, as many uncertainties lie ahead with COVID-19,” Fleck said. “Once again, for tobacco users, it is a comfort that they rely on during these times.”  

What’s Ahead? 

One headwind for retailers to watch is potential for tax increases on tobacco products due to the pandemic.  

“COVID-19 is creating serious budget issues that we’re only just now starting to calculate. States that had started to grow accustomed to having large surpluses now have huge deficits that may surpass what states dealt with during the 2009 recession,” Conley pointed out. “As a result, tax increases on all tobacco and nicotine products are absolutely going to be considered in dozens of states over the next year. On the plus side for retailers, budget deficits will make it more difficult for state legislators to justify banning flavored vaping or tobacco products due to the tax revenue and jobs they provide.”

Another is how the premarket tobacco authorization (PMTA) will impact the category. 

At press time, the new date when (PMTA) applications are due to the FDA is set for Sept. 9, 2020. 

“In theory, this would mean that after the September deadline, only products with pending or approved PMTAs before the FDA can continue to be sold by retailers across the U.S. Those selling JUUL, NJOY, Vuse, blu, etc. have little or nothing to worry about in terms of potential dead stock, but some of the more fly-by-night companies that make disposable vaping products seem likely to exit the market in September,” Conley warned. 

For a while, the shelf space for vaping products in c-stores seemed to be increasing by the month, he said. But now that some products are likely exiting the market ahead of the PMTA deadline, “the opposite appears to be occurring.” 

Conley believes states will begin to police the market more aggressively than the FDA. “We are going to see attempts at the state level to make selling products without a pending or approved PMTA a crime. Of course, this will not stop the black and gray markets, but will just drive them further underground,” he said.

read entire article here: https://cstoredecisions.com/2020/06/08/tobaccos-2020-trajectorby clicking herey/


InsightRS Celebrates 3 Years of SUCCESSFUL Scan Data Service with RJ Reynolds & Altria, and 28 years of POS Software Development

June 21, 2019

INSIGHT RETAIL SOFTWARE

June 21, 2019

Insight Retail Software began Scan Data Services in early 2016 and the results have been tremendous.

We are proud to have served our customers for over 3 YEARS submitting scan data for Altria and RJ Reynolds.  Insight Retail Software has more experience in the Tobacco Scan Data space than any other company in the industry.

====================================================

BREAKING NEWS – InsightRS is Approved for ITG Reporting and is successfully transmitting data.

Don’t waste your valuable time with failed transmissions, rejected files and non-approvals.  Call the EXPERTS in the field for an easy scan data submission.  We ARE THE BEST for a reason.

====================================================

WE DO NOT SELL YOUR DATA!

Your data is private and personal and that’s how we treat it.  We will NEVER use your private data for profit. We submit your data and protect your data on our secure Microsoft Azure Servers.

====================================================

FULL SERVICE PROVIDER

Insight Retail Software can provide everything you need to successfully run your business:

  • Powerful backOffice™ Software for a Single Store or Multi-store chain.
  • Hosted Service allows you to log into to your account from anywhere.
  • LOYALTY!!!!
  • Altria Reporting
  • RJ Reynolds Reporting
  • ITG Reporting
  • Team of Scan Data Experts on Staff.
  • Complete POS System Solution with Technology Experts on staff.
  • 28 years of Point-of-Sale Hardware and Software experience.
  • Integrated Credit Card Solutions

====================================================

≡ InsightRS is your trusted Technology Advisor ≡

InsightRS is your trusted technology advisor and here’s an example of why:

Quote from a 135 store chain :

“I would like to thank you both for your work on our account.  I’ve been told by many different folks that getting verified with RJR is a very tall task, but you knocked it out in record time!” 

Thanks again

number one insight eye final

For more information on our Scan Data and Point-of-Sale full product offering, give us a call at 518.633.4111 – Option #1

Visit our website at: http://insightRS.com


Scan Data Service for RJ Reynolds from Insight Retail Software

May 10, 2018

There seems to be some confusion about who can provide Scan Data Service for RJ Reynolds.  Insight Retail Software has been working with MSA to provide Scan Data Service to our customers for over 2 years.  Don’t buy into “we are working on it” from other providers – go with a successful provider.  We are a successful provider.

On the other hand, we are happily picking up those customers that are frustrated with providers that aren’t fulfilling their promises.

insightRS_blkblu

 


Scan Data Rebates Equal Big Money

August 3, 2016

We are so excited that our Scan Data customers are receiving their rebate dollars!  Join our customers across the US that are participating in the InsightRS Scan Data Service  [SDS] Rebate Programs offered by Altria PM and RJ Reynolds.

InsightRS SDS collects the appropriate data and submits to inRhythm and MSA.  This allows you to take advantage of this great opportunity for more profit from your tobacco sales.  Using our automated daily process, we submit the necessary data for you to comply with the program requirements.  We only collect 25% of your rebate for providing this service.  Most importantly, this will require no additional effort from you.

GIVE US A CALL TODAY!

#ShowMeTheRebates

InsightRS SDS Website – Click Here!

sds


Visa Security Alert Threat Landscape: Pin Pad/POS Skimming

June 3, 2016

Incident Details

Visa Global Payment System Risk is aware of increasing incidents involving suspects placing skimming devices on point-of–sale (POS) terminals for the purpose of collecting payment card information, including PIN numbers. Perpetrators use this information to create counterfeit cards re-encoded with the stolen card information and make unauthorized ATM withdrawals. The primary targets for these recent skimming events are self-checkout terminals in supermarkets. However, any POS terminal may be at risk, including those that are often unattended, such as terminals near deli counters, coffee stands, etc. The perpetrators are mobile and will target multiple stores within a geographic area for a period of time before moving on to a new location. Most entities targeted are using payment devices that have not yet been upgraded to accept EMV cards.

Placement of Skimming Devices

Skimming devices can be placed at any time of the day but placement usually occurs during slower times of business when the perpetrators can go undetected by employees or other customers. The perpetrators will usually work in teams of two or more with one person being a lookout, one person placing the skimming device on the POS terminal and another creating a barrier so that no one can observe the skimming device being placed. Perpetrators have been known to use large items such as packs of paper towels to block the view of POS terminals. In some instances, it was reported that the suspects created a distraction in the store by faking a medical incident or causing commotion that distracted the attention of store personnel away from the POS terminals. The skimming devices will mimic the look of the front of the POS terminal.

Recommended Inspection & Response Actions

1. Prevention Through Device Inventory Management

  • In accordance with PCI DSS Requirement 9.9, ensure implementation of security controls to protect POS devices from tampering and substitution. Examples include:

Maintain a list of devices including the device serial number or other method of unique identification. 

Keep a list of device location either by store or physical location within the store itself (i.e., self-checkout, deli counter, manned checkout). 

Train personnel to be aware of suspicious behavior and to report tampering or substitution of devices.

 Verify the identity of any third-party persons claiming to be repair or maintenance personnel, prior to granting them access to modify or troubleshoot devices.  

2. Physical Inspection of POS Devices

  • Implement security procedures to inspect POS devices at least twice each day and at random times.
  • Physically examine the device. Skimming devices are typically attached with minimal adhesive allowing them to be place and removed with ease, so devices may be detected by giving the front of the POS/PED a good grab-and-pull. Weighing the devices may also identify tampering.
  • Please note some skimming devices are Bluetooth enabled and data can be captured without the device needing to be recovered.
  • When inspecting devices, use backup security personnel to monitor from a distance as suspects may watch compromised terminals and suspects are trained in counter surveillance to avoid detection/arrest.

3. Device Recovery Response

  • If a skimming device is discovered on a POS terminal, do not handle it, as evidence may be damaged.
  • Notify local law enforcement and the FBI or USSS office so they can recover the skimming device.
  • Protect any video surveillance that may be used to identify any perpetrators and confirm timing of when the device was placed on the POS terminal.
  • Initiate incident response procedures and notify your Acquirer so that Visa can assist with the investigation.

 

Information from VISA April 2016

For other questions, please contact Cyber Intelligence & Investigations via email at USFraudControl@visa.com

Additional Resources:

What To Do If Compromised

insightRS_blkblu

 


Support for older versions of Internet Explorer Ended

May 31, 2016

What is end of support?

Beginning January 12, 2016, only the most current version of Internet Explorer available for a supported operating system will receive technical support and security updates. Internet Explorer 11 is the last version of Internet Explorer, and will continue to receive security updates, compatibility fixes, and technical support on Windows 7, Windows 8.1, and Windows 10.

Internet Explorer 11 offers improved security, increased performance, better backward compatibility, and support for the web standards that power today’s websites and services. Microsoft encourages customers to upgrade and stay up-to-date on the latest browser for a faster, more secure browsing experience.

What does this mean?

It means you should take action. After January 12, 2016, Microsoft will no longer provide security updates or technical support for older versions of Internet Explorer. Security updates patch vulnerabilities that may be exploited by malware, helping to keep users and their data safer. Regular security updates help protect computers from malicious attacks, so upgrading and staying current is important.


Potential risk of using older versions of Internet Explorer:

Security

Without critical browser security updates, your PC may become vulnerable to harmful viruses, spyware, and other malicious software which can steal or damage your business data and information.

Compliance

Businesses that are governed by regulatory obligations such as HIPAA should conduct due diligence to assess whether they are still able to satisfy compliance requirements using unsupported software.

Lack of ISV Support

Many Independent Software Vendors(ISVs) no longer support older versions of Internet Explorer. For example, Office 365 takes advantage of modern web standards and runs best with the latest browser.

Click here to read more

 


EMV is real, like it or not.

March 31, 2016

CAN WE GET A ‘MEH’?

Survey finds that consumers don’t seem to care whether payment terminals are EMV capable.

March 31, 2016

​NEW YORK – Forbes writes “there was a lot of hoopla” surrounding the October 1, 2015, EMV liability shift date, where retailers that did not upgrade to EMV-capable payment technology would become liable for any fraudulent purchases that resulted from chip-card transactions.

According to a recent CardHub survey, 42% of retailers have not updated terminals in their stores to make them EMV-compliant—and consumers don’t seem to care, writes Forbes. The publication added that CardHub found “some 56% of people surveyed don’t care if a retailer’s payment terminal is chip-enabled, and 41% of consumers say they don’t have—or don’t know if they have—a chip-enabled credit card.”

Of the retailers CardHub included in its survey, only 60% that said they would complete equipment upgrades by the October 1, 2015, liability shift deadline have finished updating all of their terminals.“We were a little bit surprised by just how slow the uptake is here,” Jill Gonzalez, an analyst at CardHub, told Forbes, adding, “The banks did their part, the financial institutions got their chip-enabled cards out, and the retailers really are taking their time.” She also says that retailers “aren’t feeling the pressure of being responsible for fraudulent activity” because it hasn’t become a financial reality.

However, as Conexxus Executive Director Gray Taylor points out, many retailers haven’t flipped the switch to accept EMV payments “because they can’t, reasonably or unreasonably.” There’s also strong indication from retailers that the October 1, 2017, liability shift for outdoor payment equipment (i.e., dispensers) will be difficult to reach for those same reasons. “What has resulted is retailer abuse—starving innovation, paying premiums for development, putting equipment into the market with the understanding that multiple site-down visits will be required—has never been seen before in any mandate,” he told NACS Daily.

Furthermore, the card companies aren’t calling EMV a mandate, but for retailers who don’t do it, chargebacks will go from a light sprinkle to a massive downpour.”

Forbes writes that installing EMV-compliant terminals is a dual-cost process for retailers. The first cost is upgrading (or in some instances replacing) all of their terminals, and the second cost is terminal activation. For consumers, their “meh” attitude is likely because education about EMV chip cards hasn’t emphasized the security aspect.


Retailers may have a “Meh” attitude but EMV is real and MUST be addressed.  It’s a difficult process for everyone but our QIR Certified Staff can help to answer your questions. Don’t wait until the chargebacks start to happen, as was the case with one of our customers.

Give us a call – 518-633-4111 x 103
EMV Chip
 insightRS_blkblu

Ever Heard of Advocacy Cards?

February 26, 2016

You haven’t, because they don’t yet exist. Read on to find out if the concept is something you should consider for your operation.

Advocacy cards. They don’t have quite the same ring as loyalty cards do, but maybe get used to the idea?

While advocacy cards are not a living, breathing thing, advocating for customers is fast becoming the new way retailers should approach customer relationship-building beyond simple loyalty efforts.

While a loyalty card program rewards consumers for quantity of goods and services bought, advocacy cards could go a step further to inform the qualitative aspect of the retailer-customer bond— rewarding shoppers who buy healthy foods, for example, with points, gift cards or other incentives.

Sounds like a daunting task for a retailer, but it’s one that all retail channels should think about.

Retailer advocacy for customers was discussed during the webinar “Top Food Trends for 2016.” Sponsored by The Food Institute and BMO Harris, the session was comoderated by Phil Lempert, known as the “SupermarketGuru,” and The Food Institute CEO Brian Todd.

In addition to citing consumers’ thirst for additional product information along with coming to grips that the “retail world is in flux,” Lempert said advocacy might be the new loyalty. In that spirit, “focus beyond relationships and think beyond loyalty to advocacy,” he said.

Your consumers are already vigilant when it comes to the food selection process—like vetting a political candidate. They abide by concepts of “free from” and “less is more,” the latter meaning products with five or fewer ingredients and no artificial ingredients. Foods labeled with health attributes saw sales increase 13%, said Lempert, citing the National Grocers Association-SupermarketGuru 2015 survey.

The broad picture: A new way of eating will be defined by new proteins, algae, insects, vegetable, yeast, cricket flour and nut powders. Rewarding your customers for participating in the trend could incentivize those higher-margin items, and earn you goodwill and higher sales in the process.

insightRS_blkblu

 


Consumers Tell All

February 25, 2016

Guess what customers are saying about your stores? Some of the answers surprised even us

By Abbey Lewis, Editor in Chief, Convenience Store Products , Feb. 2, 2016

consumer-opinions.png

Illustration by Jean Jullien

From behind the two-way mirror, we exchanged glances—we were perplexed, surprised, amazed. A colleague and I sat with our notebooks in the dark, prepared to hear a lot of things we already knew: Customers like variety, fresh food, clean bathrooms, etc. But when our two focus groups arrived at Product Evaluations Inc.’s offices in Oak Brook, Ill., we heard a lot of things we weren’t expecting. Did you know they don’t consider convenience stores and gas stations to be the same thing?

Product Evaluations, a foodservice market research company, usually focuses only on food. Its expertise is on your roller grill or coffee bar. But for us the company bent the rules, focusing the line of questioning on the forecourt, backcourt and new products—and, of course, foodservice.

When we began developing the questions, we realized this could be a unique opportunity to truly discern between millennial customers and all the others. So we broke them into two groups. The first group was made up mostly of Gen X shoppers, with some baby boomers. The second group was composed entirely of millennial customers.

It’s worth mentioning all panel participants are from the Chicago area, which is flush with 7-Eleven, Speedway, BP, Thorntons and independent locations. None of our participants had even heard of Wawa, much less Rutter’s, Kwik Trip or Stripes. (Maybe next year we’ll conduct a panel from Florida and see what they think …)

Read on to see the differences and surprising similarities among respondents—as well as actionable tips based on their feedback. And keep an eye out at CStoreProductsOnline.com to read some of the outtakes.

> Consumer Loyalty Programs <

MILLENNIAL

Q: What makes you loyal to a particular convenience store?

Liz (Household income <$25,000): I look for a rewards program. I have one that’s an app on your phone and you can get free coffees and different free things. … I know if I get something, I’m going to get something free next time. It’s easier on my wallet. 7-Eleven had free coffee for the entire week recently, so I was there a lot. I went out of my way to get to that.


Q: Who has used rewards cards? Does it make you more loyal to those brands?

Mary ($75,000-$99,999): Yeah, at Speedway if you say you don’t have [your card], half the time they’ll just scan a new one for you. They pass them out like candy.

Tom ($100,000 or more): Yeah, they have bonus points that you buy like, say you buy a Red Bull, you get a hundred more extra points or something like that [at Speedway].

David ($100,000 or more): You buy three pieces of pizza instead of two, you get a bunch of extra points …

Convenience Store Products: So do they “get you” on that?

David: Oh yeah, I’m a sucker for that.


Big Idea

Liz: When I go to get scratch-o­ffs, I always go to the CITGO in Glenwood, Ill., because they have all the machines right next to each other. They also have an area where you can sit down and scratch them o­ff. It’s much better than other places.

 

Altria Scan Data

GENERAL POPULATION

Q: What are you purchasing when you go to the convenience store?

Lorraine ($25,000-$39,000): When I go to a c-store … I might get some feminine products. I don’t want to necessarily go through the hassle of going to Wal-Mart, standing in line, going to search for it. The convenience store has got your drinks over here, you got your other stuff over here, you go, “OK, let me just grab it real quick and go.” The big stores, you have to deal with people, the crowd, and you got to really search. You ain’t got time for that.

Catherine ($100,000 or more): I usually just go there for drinks, like AriZona tea, or just a bag of chips and then go.

David ($100,000 or more): Beer, lottery tickets, scratch-offs—that’s probably it for that.


Do This!

Mobile payment, souped-up loyalty programs, at-pump ordering, connected cooking equipment and more can greatly affect your foodservice program. According to an NCR study from earlier this year, 67% of restaurant owners and managers said that technology has a direct effect on increased revenue, and 35% are more dependent on tech tools than they were a year ago. Just remember to do your due diligence. Don’t invest in something your customers won’t use.

New-Product Strategy <

GENERAL POPULATION

Q: How often do you go into the convenience store vs. just staying out at the pumps for gas?

Liz (Household income <$25,000): Most of the time I go inside.

Peter ($25,000-$39,000): I always go inside. When I’m not getting gas at Costco because it’s cheaper, whenever I stop at one of those stations, I always go inside. If I stop at one of those stations to get gas, it’s because I’m almost empty.

Jane ($40,000-$74,999): If I’m at the pump, and it’s at a convenience store, I always go in. Not that I need to go in. I don’t know why. I want to look at something. And I don’t pay at the pump.

Anne ($40,000-$74,999): Even with your credit card. Just go in. You just got to go in.


Convenience Store Products: You say you don’t ever pay at the pump?

Peter: I don’t because of security reasons. … I’ve heard so many things. I always go inside and pay, even if I want to swipe my card—I just don’t swipe it at the pump.

35%

The amount of gas customers who also go inside the store —2015 NACS Consumer Fuels Survey

 

Q: What piques your interest when you walk in a store? What will catch your eye?

Peter: Sometimes a display. What’s in front of your face—sometimes it’s a new product.

Anne: You know when you were a kid in a candy store, you see something at that display and you think, “Let’s go check that out.”

Peter: New Gatorade just came out. New flavors. Oh, that looks good. I’ll just take it.


MILLENNIAL

Q: What makes convenience stores unique from other kinds of stores?

Catherine ($100,000 or more): No lines.

David ($100,000 or more): In and out—it’s quick.

Lorraine ($25,000-$39,000): Everything is conveniently placed, so it’s not a whole search through a maze. Most of the aisles are open, so that when you’re walking through diagonally, you can see most of the things as you’re going. The setup is more open than a regular store.

Tom ($100,000 or more): Everything is accessible—easy to find.

“I’ll be out at lunch, and I don’t want to be at work, so I’ll find the gas station, go in there, look around, take my time, find something to snack on, then go back to work.” —Liz (<$25,000)

Do This!

New products matter! Work on developing your new-product strategy, but first strengthen Your core offer. Implement the proper analytics to measure your core products before investing in too many new-product tests. Of course, consistency could be the key—your customers are coming to you to find new products and will go to the same area or merchandiser to find them each time. Develop a plan and stick to it.

Store Atmosphere <

MILLENNIAL

Q: How do you choose one store over the other?

Amanda (Household income $40,000-$74,999): I judge it on the size of the gas station. If I’m driving around or on a road trip, I’m going to hit the gas station that’s the biggest if I’m looking for snacks. I’m not going to go into, like, a little square shop …

Convenience Store Products: Why wouldn’t you go into the little place?

Amanda: Because then I feel like there’s less selection. If I’m going there specifically for food or whatever, I’m going to look for the biggest one. Even for a bathroom, I look for the biggest one because it means it won’t be outside.


Q: What do you buy at convenience stores?

Jenna: I remember when those Cheetos things came out, with all like the weird balls and everything, and I was like, oh my God, that’s going to be amazing. I was looking for them and I figured the gas stations would have it, so that’s when I was just knocking down the door. I finally found them.

57%

The amount of convenience stores (127,588 total) that sell motor fuels —NACSonline.com

 

GENERAL POPULATION

Q: What does the size of the store mean to you?

Peter ($25,000-$39,000): The small ones—it’s too cramped in there. There’s too many people in there. And it’s not just the inside, but the outside also. When you’re pulling up to this huge place, where there’s 10, 12 pumps and a big parking lot … with good lights.

Jane ($40,000-$74,999): Yes, you want the good lighting. It would be a safety issue.

Jack ($100,000 or more): A cramped place doesn’t feel as safe.

Jane: I will bypass those [small stores]. I’ll go to a bigger one. I would definitely go there before I’d go to a smaller one—it’s just safer.


Big Idea

Patty ($40,000-$74,999): What they need is oatmeal. Everyone else has oatmeal. I want oatmeal. It would be perfect for a convenience store—defi­nitely.


Do This!

Surprisingly, both demographics differentiated between “gas stations” and “convenience stores.” To explain, Liz said, “I feel like the size is what distinguishes it. If it’s a really small building, then we feel like it’s just a gas station, nothing special. If it’s a bigger-size building and there’s more square footage, then it’s more of a convenience store.” Installing brighter lights and decluttering could go a long way toward attracting that new customer, boomers and millennials alike.

Foodservice  <

GENERAL POPULATION

Q: What’s your favorite food to buy at convenience stores?

Lorraine (Household income $25,000-$39,000): Pizza. You’re not expecting to get a supreme pizza—like, it’s going to be your most basic pepperoni, sausage or cheese.

David ($100,000 or more): I’m one of the least pickiest eaters out there, so it’s like I’ll get a Speedy Dog, and just load it up with all the ingredients, and I’ll go to town and I will love it. I’ll get their pizza and I’ll love it. That’s just me.

3 in 4

The number of shoppers who say it’s important to feel good about the foods and beverages they consume —Technomic’s Consumer Trend Report

 

Q: Which foods belong in convenience stores, and which do not?

Convenience Store Products: OK, so you’ve indicated that these items don’t ­fit at all: deli salads; chicken, either fried, roasted or grilled; soup, chili, dispensed ice cream or frozen yogurt.

Jenna (<$25,000): Where are you cooking the chicken?

Convenience Store Products: What about ice cream, soup or chili?

Amanda ($40,000-$74,999): I haven’t seen those.

David: Yeah, me neither.

Catherine ($100,000 or more): I think it’d be hard to keep the frozen-yogurt machine clean, but I’d totally get it.


MILLENNIAL

Q: How have your perceptions of convenience-store food changed?

David: Before, I always just assumed that it wasn’t good, that it wouldn’t taste good—I don’t know. … Once it became convenient to where I was working, and it was easy, convenient to get food there, I tried it. I said, “What the heck? Let’s do it.” And it tastes good. Let’s do it again.

Amanda ($40,000-$74,999): I feel exactly the same. I always thought it was just disgusting, and people might sneeze on it or something, but then it’s like, my guy would have me go pick up a pizza or something. Okay. And then I’m like, “Oh, it’s not that bad.” Then I ended up getting a few things for myself after that.

Tom ($100,000 or more): I felt like coffee was really bad at convenience stores, but I actually found out that at 7-Eleven, their coffee is much better than I thought.

“A large Slurpee from 7-Eleven—at 2 a.m., every time I was studying … we’d all go. It was awesome. And they go great with those little taquito things.” —Jenna

InsightRS Scan Data

Do This!

These customers have changed their view of the food in your stores. Believe it or not, as much as perception of c-store fare has improved, there are still opportunities to be had. And freshness is the key. According to Technomic, 76% of consumers say positive terms such as “natural flavors” are perceived as resulting in enhanced flavors. And shoppers are demanding more transparency in their food. Non-GMO-fed, verified fresh eggs, chicken, pork and even sausages from brands such as Fork in the Road will be worth watching. Try it. They might like it!

http://www.cstoreproductsonline.com/foodservice/opinion-consumer-perspective

This slideshow requires JavaScript.


Convenience Stores Offer More Convenience

February 23, 2016

Convenience Stores Sell Time

Convenience stores offer speed of service to time-starved consumers who want to get in and out of the store quickly. These shoppers recognize this channel of trade for its convenient locations, extended hours of operation, one-stop shopping, grab-and-go foodservice, variety of merchandise and fast transactions.

The average convenience store is 2,744 square feet. New stores are bigger, with 3,590 square feet, with about 2,582 square feet of sales area and about 1,008 square feet of non-sales area — a nod to retailers recognizing the importance of creating destinations within the store that require additional space — whether coffee islands, foodservice areas with seating or financial services kiosks. Convenience stores also have expanded their offerings over the last few years, with stores become part supermarket, restaurant, gas station and even a bank or drugstore. (NACS State of the Industry data)

The convenience store industry is America’s primary source for fuel. Overall, 83.5% of convenience stores (127,588 total) sell motor fuels, a .7% increase (960 stores) over 2013. The growth of convenience stores selling motor fuels is nearly double the overall growth in the industry, as fuels retailers added convenience operations and convenience retailers added fueling operations.

Convenience stores have an unmatched speed of transaction: The average time it takes a customer to walk in, purchase an item and depart is between 3 to 4 minutes. Here’s the breakdown: 35 seconds to walk from the car to the store, 71 seconds to select item(s), 42 seconds to wait in line to pay, 21 seconds to pay and 44 seconds to leave store. (NACS Speed Metrics Research, 2002)

The convenience store industry is a destination for food and refreshments. With falling revenues from fuels and tobacco products, foodservice sales are increasingly becoming convenience stores’ most profitable category. In fact, convenience store foodservice is roughly a $41 billion industry contributing 19.4% to in-store sales in 2014 (NACS State of the Industry Report of 2014 Data).

Convenience stores are everywhere. There are 152,794 convenience stores in the United States — one per every 2,095 people. Other competing channels have far fewer stores, such as supermarkets (41,529 stores), drugstores (41,799 stores), and dollar stores (26,572). (Source: Nielsen, as of December 31, 2014)

Consumers are embracing convenience stores like never before. An average store selling fuel has around 1,100 customers per day, or more than 400,000 per year. Cumulatively, the U.S. convenience store industry alone serves nearly 160 million customers per day, and 58 billion customers every year.

Self-serve at the pump is a part of most convenience stores’ fueling operations. The first self-serve gas station was opened by Hoosier Petroleum Co. in 1930, but was closed by the fire marshal as being a fire hazard. Frank Ulrich reintroduced the idea in 1947 at the corner of Jilson and Atlantic in Los Angeles. Modern self-service began in 1964 with the introduction of remote fueling; an attendant was no longer required to reset the pumps after each transaction. Today it is now available in 48 states. (New Jersey and Oregon still require full-service operations; New Jersey’s law was enacted in 1949; Oregon’s in 1951.)​

http://www.nacsonline.com/Research/FactSheets/scopeofindustry/pages/convenience.aspx

This slideshow requires JavaScript.


%d bloggers like this: