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AN INCONVENIENT TRUTH (In Retail) How we can continue to redefine the Convenience channel Late last year, the largest convenience retailer in the world, 7-11, with near 72,000 stores, hit an amazing milestone of selling over $1 Billion of Private Brands annually. This is quite an achievement, and their 1500+ sku portfolio in own brands also shows great progress considering they only had 87 items just 13 years ago. I love it, and congratulations to them and the other leading convenience store chains that are investing in Private Brands. Now here is an inconvenient truth… The success could be far greater for Private Brands and CPG brands if they wanted to push the envelope even further. The convenience channel is full of potential and continuing to advance the sensory environment, healthy positioning, and technology in-and-out of the store will all have the effect of enhancing own brand growth.
The Environment Dictates Product I learned a cruel lesson twenty years ago in working to develop Pathmark Preferred, which was an ultrapremium segment we were fashioning for the now defunct retailer in the New York area. Pathmark was known as a value operator, and “Preferred” was designed beautifully,
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both the product and packaging. The unfortunate reality was that it was really overdesigned ---- the consumer didn’t believe it could come from Pathmark. You can apply this inconvenient truth to many Convenience Store operators. The store environment goes a long way in dictating the credibility of your offering. If your checkout counter screams energy drinks, cigarettes and candy, with a dilapidated store employee at the register, it is tough to sell a lot of healthy products and develop a reputation similarly for fresh, natural or organic (even with a bunch of bananas on the counter).
Destinations & Sensory
It is also tough to develop a familyfriendly environment or one where you want to linger when you don’t feel entirely safe. Well situated lighting, not just in the parking lot but inside the store itself, is a sensory element that must be created before you think futuristically about what type of product you can wedge inside the four walls.
Many shoppers regard Sheetz’s coffee as a must-have destination that starts of their day, and it obviously builds a daily ritual as consumers become attached to it.
Your store environment matters, and in the end, it must be complementary and enhance the portfolio you are trying to sell.
There are destinations that convenience store retailers have established that are meaningful and lead the way in the channel. Wawa and Sheetz get many accolades and justifiably so, as their destinations and private brands are intimately intertwined.
Wawa has developed a different daypart ritual around their sandwiches, which honestly put any Subway or Jersey Mike’s to shame. Clean environment, high-tech ordering, delicious product with a wide selection.
