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11/18/2022

The Future of C-stores

Convenience retailers must create a fresh story and brand that customers can connect with.
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People on the go

The elevated experience and higher-quality food at today’s best convenience stores can be traced to a seemingly unrelated phenomenon: plunging cigarette sales.

To understand the connection, consider the magnitude of the behavior change. According to the American Lung Association, cigarette sales nosedived by 68 percent among American adults from 1965 to 2018. A huge driver of traffic and sales — the average customer’s regular need to pick up another pack of cigs — drifted away like a puff of smoke.

Fortunately, innovators like ampm, Sheetz and Wawa managed to find a new draw. Their success led to today’s nearly industrywide focus on higher-quality foodservice, a better in-store experience and, in recent years, mobile apps that encourage return visits.

But how will c-stores pivot if another massive profit center — their annual sales of about 133 billion gallons of gas — drives off into the sunset?

Change Is Coming, But Slowly

In 1970, the idea that cigarettes could nearly disappear from American life would have seemed quite a stretch to people who were accustomed to puffing away on airplanes, at indoor restaurants, at the movies, in their offices, you name it.

Today, because of climate change and the rapid evolution of electric vehicles (EVs), it’s possible to imagine a year in, say, 2040 or 2050 when gas pumps have gone the way of filter-less Camels — i.e., they’re still around, but no longer mainstream.

As with smoking, it will take a long time for Americans to ditch fossil fuels, but convenience store decision-makers need to be clear-eyed about the reality of the gradual shift.

As noted in a webinar by architecture and engineering firm HFA, some states already are poised to require installation of EV chargers in the parking lots of new and redeveloped commercial and residential buildings. California’s CALGreen Building Code is leading the way at a time when the federal government has earmarked $7.5 billion for EV charging and enhancing the electric grid.

“What’s coming out of California is a bellwether,” HFA’s Scott West, a Fort Worth, Texas-based mechanical engineer and energy team lead, noted during the webinar. “We’re already seeing parts of it being replicated in other codes currently under development.”

Owners of older buildings could eventually be required to install EV chargers as well.  

To be sure, many c-stores will replace fuel pumps with EV chargers in the decades ahead. But they need to envision a long-term future in which EV charging is available all over the place — in the parking lots of commercial and multi-tenant residential buildings, in the garages of millions of single-family homes, and even from companies like SparkCharge that come to you to charge your car, right in your driveway or office parking lot.

Clearly, EV charging may not be enough to replace the traffic historically generated by fuel pumps. Here are two quick tips for adjusting to the coming shift:

Stick to Your Roots

Decision-makers in convenience retail should be skeptical of suggestions that they will need to completely reinvent their stores to keep attracting customers. Would-be innovators have tried this many times over the years, attempting to fuse c-stores or chain drugstores with nontraditional uses.

Convenience retail is about meeting the immediate needs of people on the go. If you forget this, it can lead to odd mismatches. Nobody wants to go to a yoga studio infused with the aroma of signature fried chicken cooking next door (unless I’m missing something and “fried chicken yoga” is already a thing). And, no, your corner c-store will not be the second coming of WeWork (much to the relief of your investors).  

Ultimately, the question should be: What makes life more convenient for people who are on the go? The mode of transportation matters only to the extent that it helps you better understand who your customers are. For example, a c-store along a central commuter route for cyclists in Paris or Copenhagen certainly could have a wide range of products that make life easier for cyclists.

Be Original

That same European c-store could also sport signage, memorabilia, graphics and storytelling related to cycling and sustainability. It could have a high-def flatscreen displaying content by or about local activists, civic associations and athletes. But convenience would still be the name of the game.

Moving forward, it will be even more important for c-stores to stand out via distinctive branding and design. When you have an emotional connection to a place, you have a stronger reason to go there. Today there’s a growing risk that too many convenience retailers, including smaller independents, will copycat the likes of Wawa, Sheetz and ampm in ways that feel generic and lifeless.

As c-stores explore cannabis sales and other possible traffic-drivers, they should simultaneously prioritize taking original and inspired approaches to branding, design and messaging.

But none of this is to suggest that offering elevated foodservice should be avoided or that it will play a diminished role in the future. While other product categories (including cannabis) may find a place in the overall mix, the mainstays of convenience and foodservice will reign for years and decades to come.

Simply put, modern life is modern life — balancing work, home and play will continue be a huge challenge for consumers. Our job is to help them find that balance by being nimble and innovative enough to meet their ever-changing needs in engaging ways.

How to plan for the future? Ask questions about your customers, how you can improve their lives today and where you’re heading tomorrow. Use those answers to shape your entire approach to marketing, product selection and brand identity.

Inspiration isn’t the same thing as imitation. Strive to be as good as Wawa and Sheetz on foodservice and the in-store experience, but carve out your own identity.

Don’t be afraid to look outside the industry for standouts. If you’re selling artisan doughnuts, maybe an explosion of color along the lines of Sugarfina or Candylicious stores could be the right move. If you’re all about local roots, take a look at photos of corner stores from bygone eras right in your own community.

Give your on-the-go customers the products — and the stories— they crave, and you’ll have a competitive edge with or without regular unleaded.

Joseph Bona is the founding partner and president of Bona Design Lab, which has elevated the retail experience on behalf of convenience store clients such as Shell Select, Alltown, Migrolino (Switzerland), Ipiranga (Brazil) and Adnoc Oasis (UAE). He can be reached at [email protected].

Editor’s note: The opinions expressed in this column are the author's and do not necessarily reflect the views of Convenience Store News