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JERSEY CITY, N.J. -- Legislative battles and a still-struggling economy marked a year of ups and downs for the convenience store industry in 2011. Now, with the new year upon us, the editors at Convenience Store News offer their top 10 predictions for the industry in 2012.
1. More buying and building of stores. 2011 saw a rush of both acquisition activity and new builds in the industry. Expect that to continue. The industry is still highly fragmented and many retailers have stated their intentions to grow and then grow some more.
2. Economic improvement. We won't head back into a recession and unemployment will finally go down. Europe will stabilize its economy enough that the Euro survives. In the United States, companies will realize another recession isn't coming and begin to loosen up their hiring practices. Job growth won't be fantastic, but the "bad old days" of 2008 and 2009 will be left far behind.
3. Further regulation of the tobacco industry. The Food and Drug Administration (FDA) started its required review of dissolvable tobacco in July and could issue regulations this year. The agency's Tobacco Products Scientific Advisory Committee has a March 23 deadline to submit a report to the Secretary of Health and Human Services. Also, nearly a year after giving up its legal fight against electronic cigarettes, the FDA will finally set regulations for electronic cigarettes that are in line with its regulations of traditional cigarettes.
4. Mobile payments take off. Google Wallet will continue to expand and Isis is ready for a national launch. More cell phones will also come to market with mobile wallet capabilities. The question is: Will mobile wallets save c-store operators money? Retailers are still dealing with the less-than-thrilling cap on debit card transaction fees and uncapped credit card fees.
5. Petroleum alternatives gain traction. 2012 is the year electric vehicles and natural gas will finally make a dent as petroleum alternatives. Despite challenges to owning either type of vehicle, oil remains at $100 per barrel and consumers will begin to see the benefits of electric cars and compressed natural gas, which are both cheaper at the pump.
6. Widespread digital marketing use. Smartphones and mobile applications will continue to be popular and become an even greater resource for marketing purposes. Companies will try to win users over with apps and games that are fun, as well as helpful and functional. We'll also see more web-to-location promos using smartphones, social networks like Foursquare, and texting.
7. Converting pumpers to shoppers. This year will bring stepped-up efforts to drive traffic from the pumps into the store, including more tests of technology that enables customers to order food at the pump and mobile apps that let users order food prior to arriving on site.
8. Putting "fresh" first. "Fresh" will be the key word behind more c-stores' foodservice programs. Packaging and merchandising will reflect this in the cold case, as will signage throughout the store. Fruits and vegetables will also help communicate this message.
9. New prototypes. A resurgence of innovation in store design will occur as c-stores try to keep up with changing consumer expectations, as well as competition. McDonald's store of the future -- rolling out now -- features wooden tables, faux-leather chairs and a muted color palette.
10. Government gridlock. Don't look to the government for any major changes -- or relief from onerous federal regulations -- as gridlock rules during a Presidential election year.