CSN - May 2017 by ensembleiq

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VIEWPOINT By Don Longo, Editorial Director

Amazon Keeps Going The online giant continues its quest to change the way people shop and buy

n a move that got a lot of media attention last month, Amazon reportedly invited some of the world’s leading food and consumer packaged goods brands to sell direct to consumers on Amazon Marketplace, its ecommerce platform that enables third-party sellers to sell new and used offerings on Amazon.com’s fixed-price marketplace alongside Amazon’s own offerings. This comes after the online retail giant said late last year that it intends to open convenience stores and curbside pickup locations. And although Amazon is delaying the public opening of its Amazon Go cashier-free convenience store due to technical problems, the retailer doesn’t let any moss grow under its feet as it continues to reinvent the retail landscape. This latest move is not to be taken lightly by any retailer. You don’t have to be Walmart or Target to recognize the impact that Amazon’s effort to bypass brick-and-mortar stores could have on your business. According to an invitation For comments, please contact Don Longo, Editorial Director, obtained by Bloomberg, Amazon at (201) 855-7606 or wrote to suppliers that, “Times dlongo@ensembleiq.com. are changing. Amazon strongly believes that supply chains designed to serve the direct-to-consumer business have the power to bring improved customer experiences and global efficiency. To achieve this requires a major shift in thinking.” In some respects, this invitation to meet in Seattle is

not unlike previous times when Walmart has called its vendors to northwest Arkansas to request (demand?) concessions on price, packaging, marketing, etc. In this case, Amazon is asking suppliers to risk their existing relationships with brick-and-mortar stores by selling direct to consumers via Amazon.com. I think suppliers will be reluctant to engage in business with a company that is trying to disintermediate its best customers. Seems like the downside outweighs the upside by a considerable margin. However, I also think Amazon will continue to push the envelope in its stated, and self-serving, desire to improve the customer’s shopping experience through its online platform or ecosystem. The company is a disruptor. New services like AmazonFresh Pickup — which allows Amazon Prime members to order groceries online, make an appointment to pick them up, and then drive up and have their bags loaded into their truck by an Amazon employee, without money changing hands — will keep brick-and-mortar retailers on their toes. Or, hopefully, inspire them to get better. All retailers, especially convenience stores, have a lot invested in their physical assets. They must give consumers a reason to come to their stores and spend money, rather than click for it. The potential threat to c-stores is not so much that Amazon may open physical stores, but in how Amazon changes consumer expectations of the convenience shopping experience.

EDITORIAL EXCELLENCE AWARDS (2013-2017) 2016 American Society of Business Press Editors, National Azbee Awards Gold, Best How-To Article, March 2015 Bronze, Best Original Research, June 2015 2016 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best How-To Article, March 2015 Silver, Best Original Research, June 2015 2015 American Society of Business Press Editors, National Azbee Awards Silver, Best Profile (long form), February 2014 2015 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best Special Supplement, November 2014 Silver, Best Profile (long form), February 2014 2013 American Society of Business Press Editors, Midwest Regional Azbee Awards Bronze, Best Editorial/Commentary, July 2012 2016 Trade Association Business Publications Intl. Tabbie Awards Silver, Front Cover Illustration, June 2015

EDITORIAL ADVISORY BOARD

2013 Jesse H. Neal National Business Journalism Award Best Single Issue, October 2012 2013 Jesse H. Neal National Business Journalism Award Finalist, Best Profile, August 2012

2016 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2015 Business to Business, Retail, Single/Series of Articles, August 2015 2015 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Single Article, February 2014 2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2013 Business to Business, Retail, Single Article, February 2013 2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012

4 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

Brett Atherton Bolla Management Jon Bratta Core-Mark International Inc. Rick Crawford Green Valley Grocery Edward Davidson ER Davidson & Associates (7-Eleven Inc., retired) Jim Hachtel Eby-Brown Co. Ray Johnson Speedee Mart Kirk Leff McLane Co. Inc. Jack Lewis GPM Midwest

Danielle Mattiussi Maverik Inc. Kyle McKeen Alon Brands Inc. Richard Mione GPM Southeast Jonathan Polonsky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Roy Strasburger Convenience Management Services Inc. Jon Urbanik CST Brands Inc.

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CONTENTS MAY 2017

VOLUME 53/NUMBER 5

24 | COVER STORY The 50% Solution

The most successful players in convenience foodservice are getting more than half their overall profits from the category, but what does it take to get there?

FEATURES 34 | Looking Ahead, Not Back QuickChek celebrates its golden anniversary with new vigor. 40 | A Better-for-You Bottom Line More c-store operators are open to adding healthier products, but deciding which kind and how to market them can be a challenge.

34 Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 570 Lake Cook Rd. Deerfield, IL 60015. Copyright ÂŠ 2017 by EnsembleIQ. All rights reserved. Subscriptions: One year, $93; two years, $152. One year, Canada, $110; two years, Canada, $175. One year, foreign, $150. Payable in advance with a bank draft drawn on a U.S. bank in U.S. funds. Single copies, $10, except foreign, where postage will be added. Printed in U.S.A. Periodicals postage paid at Deerfield, IL, and at additional mailing offices. POSTMASTER: Send address changes to Convenience Store News, P.O. Box 1842, Lowell, MA 01853.

6 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

DRIVING CATEGORY GROWTH

Trusted iconic brands and expert category management delivering sustainable growth.

hersheysconvenience.com

CONTENTS

570 Lake Cook Road, Ste. 310, Deerfield, IL. 60015 (224) 632-8200 Fax: (224) 632-8266 www.csnews.com Direct Mailing Address for Convenience Store News: 111 Town Square Place, Suite 400, Jersey City, N.J. 07310

BRAND MANAGEMENT

CATEGORY MANAGEMENT MOTOR FUELS

48 | Elevating the Fuel Pumping Experience From EMV upgrades to touchscreens to audio greetings, the fuel pump is becoming more interactive and enabling operators to increase profits in-store. FOODSERVICE

54 | Growing in a Challenging Environment Improving economy, confident consumers, and still-low gas prices drive c-store traffic growth. TOBACCO

58 | In With the New How Las Vegas-based Speedee Mart keeps its tobacco business steady. TECHNOLOGY

60 | Marketing to Today’s Mobile Consumer Convenience stores and other small-format retailers are leading the way in mobile marketing.

DEPARTMENTS VIEWPOINT

4 | Amazon Keeps Going The online giant continues its quest to change the way people shop and buy. 10 | CSNews Online 18 | New Products

Group Brand Director (330) 840-9557

Ron Lowy rlowy@ensembleiq.com

EDITORIAL Editorial Director (201) 855-7606 Editor-in-Chief (201) 855-7608 Senior Editor (201) 855-7618 Associate Editor (201) 855-7619 Associate Managing Editor (201) 855-7604 Assistant Editor (201) 855-7614 Contributing Editor (303) 741-3377 Contributing Editor (201) 280-2614

Don Longo dlongo@ensembleiq.com Linda Lisanti llisanti@ensembleiq.com Melissa Kress mkress@ensembleiq.com Angela Hanson ahanson@ensembleiq.com Danielle Romano dromano@ensembleiq.com Chelsea Regan cregan@ensembleiq.com Renée M. Covino reneek@aol.com Tammy Mastroberte tmastroberte@gmail.com

ADVERTISING SALES & BUSINESS Southeast Regional Sales Manager Erika Cann (330) 357-9207 ecann@ensembleiq.com Northeast Regional Sales Manager Rachel McGaffigan (508) 385-2524 rmcgaffigan@ensembleiq.com Western Regional Sales Manager Dian Melius (949) 387-1451 dmelius@ensembleiq.com Account Executive & Classified Advertising Terry Kanganis (201) 855-7615 tkanganis@ensembleiq.com Classified Production Manager Mary Beth Medley (856) 809-0050 marybeth@marybethmedley.com

CUSTOM MEDIA Vice President/Custom Media Division Pierce Hollingsworth (224) 632-8229 phollingsworth@ensembleiq.com General Manager, Custom Media Kathy Colwell (224) 632-8244 kcolwell@ensembleiq.com

MARKETING Strategic Marketing Director (224) 632-8214

Bruce Hendrickson bhendrickson@ensembleiq.com

AUDIENCE DEVELOPMENT Director of Audience Development Gail Reboletti (224) 632-8214 greboletti@ensembleiq.com Audience Development Manager Shelly Patton (646) 217-1045 spatton@ensembleiq.com List Rental The Information Refinery (800) 529-9020 Brian Clotworthy Subscriber Services/Single-Copy Purchases (978) 671-0449 EnsembleIQ@e-circ.net

ART/PRODUCTION

20 | A Golden Future As it approaches its 50th anniversary, Swiss Farms is focused on self-improvement while retaining its sense of self.

Director of Production (973) 358-4875 Advertising/Production Manager (314) 403-4753 Art Director (224) 632-8245

EXPERT’S VIEW

CORPORATE OFFICERS

66 | Why Men Need to Champion Women Leaders It’s good for them, good for you, and good for the bottom line.

Executive Chairman Alan Glass President & CEO Peter Hoyt Chief Operating Officer Rich Rivera Chief Financial Officer Len Farrell Chief Business Development Officer & President, EnsembleIQ Canada Korry Stagnito Chief Customer Officer/President of Enterprise Solutions Ned Bardic Chief Digital Officer Joel Hughes Chief Human Resources Officer Greg Flores Chief Brand Officer Jeff Greisch

SMALL OPERATOR

GETTING TO THE CORE

82 | Message Received Is social media, text or email the best communication vehicle?

Kathryn Homenick khomenick@ensembleiq.com Roz Gilman rgilman@ensembleiq.com Michael Escobedo mescobedo@ensembleiq.com

CONVENIENCE STORE NEWS AFFILIATIONS

Premier Trade Press Exhibitor 8 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

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CIGARETTES, MOIST SNUFF

CSNEWS.COM ONLINE EXCLUSIVE

TOP 5 Daily News Headlines The most viewed articles online.

1 | 7-Eleven’s DePinto, Altria’s Benefiel Elected to CSNews Hall of Fame Joseph M. DePinto, president and CEO of 7-Eleven Inc., and Blake Benefiel, director of trade and state relations for Altria Group Distribution Co., have been selected as this year’s inductees into the Convenience Store News Hall of Fame. The newest Hall of Famers will be honored at a gala banquet and induction ceremony this fall in Dallas. 2 | Why Everything About the Physical Store Must Change The retail store as we know it is dead. Retailers must stop thinking about their stores as places that distribute products, and rather perceive them as a place to provide an experience, according to Doug Stephens, retail and consumer futurist and founder of Retail Prophet, who delivered a keynote speech at the recent Shopper Marketing Summit in New York. 3 | DOL Requests More Time on Overtime Rule Appeal A decision on the new federal overtime rule may have to wait a little longer. In April, the federal government asked for another delay in submitting its final brief to the Fifth Circuit Court of Appeals regarding the U.S. Department of Labor’s (DOL) final overtime rule, which raised the salary level for the white-collar exemption from $23,660 to $47,476. 4 | 7-Eleven to Become First C-store to Implement GS1 Barcodes The convenience store chain is rolling out scanning technology that will streamline the shopping experience for both consumers and traders. According to the retailer, improved supply chain visibility, accurate product information, product traceability, and efficient scanning technology ensure that store operations will run smoother than ever before. 5 | Meat Snacks Gaining on Potato Chips’ Dominance Over the past four years, the meat snacks category has posted compound annual sales growth of more than 7 percent, with sales growth of 3.5 percent for the year ended Feb. 25. A $2.8-billion category, meat snacks is comprised of jerky and sticks, each of which contributes about half of total sales.

Big Changes Coming to ‘Sell By’ Dates The Food Marketing Institute and the Grocery Manufacturers Association, the two largest trade groups for the grocery industry, announced on Feb. 15 that they have adopted a new phrasing they believe will bring some clarity to food expiration dates. The term “use by” will still be acceptable, but the preferable phrase is “Best If Used By.” The two groups indicated the phrase “use by” is still suitable because most consumers and marketers view it as a safety designation. However, “Best If Used By” focuses more on the quality of the food product. It is the manufacturer’s best guess as to the latest date the food should be sold or consumed. For more exclusive stories, visit the Special Features section of www.csnews.com.

PRODUCT HIGHLIGHT

The most viewed New Product online.

Alkaline88 Water Single-Serve Size The Alkaline Water Co. Inc. launched a national rollout of a new single-serve product. It is labeled under the brand name Alkaline88 to mirror the company’s bulk alkaline water that is packaged and sold in 1-gallon, 3-liter, 1-liter, 700-milliliter and 500-milliliter sizes to more than 29,000 retail locations in all 50 states. According to the company, it has developed an innovative, state-of-the-art, proprietary electrolysis process that produces healthy alkaline water for a balanced lifestyle. The Alkaline Water Co. Inc. Scottsdale, Ariz. (480) 656-2423 www.thealkalinewaterco.com

Six Things You Must Consider in Your Shelf-Merchandising Strategy Winning at the shelf is one part art and one part science. Both are critical in executing a convenience store retailer’s category management plans, Balvor LLC Managing Partner David Bishop explained in an April 19 webinar entitled “What Winning at the Shelf Looks Like.” The art side of merchandising is more operational — think availability, attractiveness and accessibility — while the science side is shelving, pricing, product, placement and signage. Convenience Store News was the exclusive media partner for the webinar. Visit the Events & Webcasts section of www.csnews.com for full coverage.

10 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

INDUSTRYROUNDUP

Sunoco Sells Majority of Its Stores to 7-Eleven

The $3.3B deal is the company’s first step in shifting to a fuel focus By Melissa Kress

unoco LP is poised to undergo another transformative year in 2017 following the April 6 news that the Dallas-based company is selling roughly 1,100 company-operated convenience stores to 7-Eleven Inc. for a total consideration of $3.3 billion in cash, plus fuel, merchandise and other inventories. The transaction also includes the associated trademarks and intellectual property of Sunoco’s Laredo Taco Co. and Stripes brands. The deal does not include Sunoco’s proprietary c-store banner, APlus, nor approximately 200 stores primarily in North and West Texas, New Mexico and Oklahoma. Also excluded are APlus franchise operations and Aloha Petroleum, which will remain part of Sunoco. “Both of those two assets are key to us going forward and things that we are interested in growing,” explained Sunoco President and CEO Bob Owens. As part of Irving, Texas-based 7-Eleven’s purchase agreement, Sunoco will enter into a 15-year take-orpay fuel supply pact with a 7-Eleven subsidiary, under which Sunoco will supply approximately 2.2 billion gallons of fuel annually. This supply agreement will have guaranteed annual payments to Sunoco, provides that 7-Eleven will continue to use the Sunoco brand at currently branded Sunoco stores, and includes commit-

ted growth in future periods. As Owens pointed out, this is the first step in a strategic decision to divest Sunoco’s company-operated convenience stores in the continental United States. “We feel 7-Eleven is a logical buyer of a majority of these assets,” he said. Once the transaction closes, 7-Eleven will be an “important large customer” as Sunoco moves roughly 20 percent of its wholesale fuel volume to the chain. Sunoco’s branded distributors account for 31 percent of the remaining wholesale fuel volume, followed by longterm contracts (29 percent) and commercial (13 percent). This move will result in a less capital- and peopleintensive business model, and give Sunoco economies of scale — all things the company considers “attractive attributes,” Owens said. According to the chief executive, Sunoco continues to believe that one of the key assets of the corporation is the attractiveness of the iconic Sunoco fuel brand and that provides it with ongoing significant growth opportunities with 7-Eleven. In addition, the brand is enhanced by its position in motorsports as the official fuel of NASCAR, Indy CAR, The National Hot Rod Association, and 35 other sanctioning bodies.

WWW.CSNEWS.COM | MAY 2017 | Convenience Store News 11

INDUSTRYROUNDUP

Credit Card Swipe-Fee Case Heads Back to District Court The U.S. Supreme Court declined to take up the 2005 case

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he U.S. Supreme Court turned away a request by banks and retailers to revive a $7.25-billion class-action antitrust settlement with Visa and MasterCard over credit card interchange fees, leaving in place a Second Circuit ruling that the deal did not adequately represent the interests of some merchants. The justices did not comment on their decision. The Retail Industry Leaders Association (RILA) and the National Retail Federation (NRF) both cheered the decision. Both groups filed a brief earlier this year opposing the effort to reinstate the settlement terms of the lawsuit challenging the anticompetitive behavior of the major financial services industry players in setting credit card fees.

“The [settlement] crafted by the banks and the credit cards was badly flawed, and the Second Circuit recognized as much in its decision. We are pleased that the Supreme Court decided to leave the lower court’s ruling in place,” said Deborah White, senior executive vice president and general counsel for RILA. According to NRF, the justices’ decision now leaves the 2005 lawsuit pending in U.S. District Court in New York, where retailers could go to trial, pursue a revised settlement, or focus on other lawsuits over the issue that have been filed more recently.

FAST FACTS The use of mobile apps, text messages and the internet to order food from a restaurant or other foodservice outlet now accounts for 1.9 billion foodservice visits.

a beverage (45 percent), or to buy a snack (36 percent). Source: NACS, the Association for Convenience & Fuel Retailing.

Move over jelly beans, 79 percent of consumers said their Easter Source: The NPD Group baskets this year would include The top reasons gas nonfood items customers go inside the conlike crayons, books venience store are: to pay and stuffed animals. for gas (50 percent), to buy Source: The National Confectioners Association

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INDUSTRYROUNDUP

eye on growth

SEEN on SOCIAL MEDIA Cumberland Farms Inc., Framingham, Mass.

n Tesoro Corp. and Western Refining Inc. are

one step closer to finalizing their pending tieup. On March 24, stockholders of both companies voted in favor of Tesoro’s acquisition of Western Refining.

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n GPM Investments LLC officially added

92 Roadrunner Market stores to its footprint. The sites in North Carolina, South Carolina, Tennessee and Virginia were previously operated by Mountain Empire Oil Co.

TravelCenters of America LLC, Westlake, Ohio

Help SCF help drivers in need! Proceeds from shirt go to support truck drivers. The campaign will run through 5/3. booster.com/truckerfund

n Uptown Mart purchased four convenience stores in northeast

Ohio from United Dairy Farmers. The market newcomer plans to expand in the Cleveland market. United Dairy Farmers still operates in Columbus, Dayton and Cincinnati.

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14 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

FRUIT, VEGGIES & MORE

HEALTHY OPTIONS FOR YOUR STORE Are you taking advantage of the growing consumer preference for fresh, healthy grab and go options? According to a recent NACS Retailer Sentiment survey, 48% of Americans say c-stores are a place to buy fresh items and 50% of c-stores have expanded fresh fruit sales. Need a consistent solution for one store or stores nationwide? You can count on McLane to deliver.

Our Fresh Produce+ solution leverages industryleading cold chain capabilities to deliver a quality fresh product mix to all customers, regardless of location. With easy-to-order shipments and customer-determined markup, Fresh Produce+ makes produce simple and profitable. For more information, visit mclaneco.com/goto/produce

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INDUSTRYROUNDUP

retailer tidbits n 7-Eleven Inc. signed a pact with

TXU Energy to purchase 100-percent Texas wind energy for its stores in the state in competitive energy markets. The eight-year deal will impact 425 7-Eleven stores.

n The Spinx Co. and BI-LO severed

ties with the Fuelperks loyalty program. Spinx is now promoting its own customer loyalty program, Spinx Xtras.

The Spinx and BI-LO partnership began 15 years ago.

n Celebrating its 50th anniversary, New Jersey Gov. n QuikTrip Corp. is adding E15 fuel

at 44 of its convenience stores in the Dallas-Fort Worth Metro area. Other c-stores that already offer E15 fuel include Family Express, Kum & Go, MAPCO, Minnoco, and Murphy USA.

Chris Christie applauded QuickChek Corp. for its contribution to the state. The retailer has opened 40 new stores and hired an additional 1,400 team members over the past nine years. n Boyett Petroleum, parent com-

n Sheetz Inc. unveiled a new loy-

alty card program that allows cardholders to receive points on nearly every in-store purchase and to customize their rewards. Cardholders receive five points per dollar spent.

16 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

pany of the Cruisers convenience store chain, formed a partnership with regional grocery distributor MTC Distributing. MTC will deliver goods from Californiaâ&#x20AC;&#x2122;s Central Valley, down to Southern California, and as far north as Reno, Nev.

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NEWPRODUCTS Lay’s Poppables

Beetology Wellness Drinks

Lay’s, one of the marquee brands of PepsiCo’s Frito-Lay division, unveiled Poppables, billed as a multidimensional, light-textured potato snack that’s packed with flavor and fun to eat. The crispy potato bites come in White Cheddar and Sea Salt varieties. They are available nationwide in 5-ounce bags for a suggested retail price of $3.29, or 2-ounce bags for a suggested price of $1.69.

Beetology beverages are cold-pressed wellness drinks made from beets, which are nutrient-dense, high in antioxidants, and believed to be good for the heart, brain and blood pressure. Five varieties are currently available: Beet + Lemon + Ginger; Beet + Veggie; Beet + Tropical Fruit; Beet + Berry; and Beet + Cherry. All of the drinks are non-GMO, certified organic, certified fair trade, kosher, all-natural, and non-dairy. Each Beetology case includes six 8-ounce bottles. The suggested retail price is $3.99 per bottle.

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Method Cali Berry E-Liquid Frisco Vapor introduces Method Cali Berry E-Liquid with Next Generation Labs’ TFN Nicotine. TFN Nicotine is a test-verified non-tobacco derived synthetic nicotine created for the vape industry that provides virtually odorless and tasteless nicotine. Method Cali Berry E-Liquid is the first TFN Nicotine brand from Frisco Vapor. The e-liquid contains strawberry and mango flavors, and can be purchased in zero milligram, 3-milligram or 6-milligram nicotine strengths per 60-milliliter glass bottle.

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Living Essentials Farmington Hills, Mich. (248) 960-1700 info@fivehour.com 5hourenergy.com

Living Essentials announces a new partnership with Major League Baseball for the 2017 and 2018 MLB All-Star Games. The partnership includes the launch of a MLBthemed Extra Strength Apple Pie 5-hour Energy Shot. The energy shot’s packaging features the MLB silhouetted batter logo and will be presented in unique, baseballthemed displays. According to Living Essentials, the extra strength varieties of 5-hour Energy are the brand’s best sellers.

Duke’s Smoked Meats Brisket Line Duke’s Smoked Meats unveiled several new products, including three new varieties in its brisket line and one new variety of shorty sausages. Made with 100-percent grass-fed brisket steak, Duke’s brisket line now includes Chipotle BBQ, Honey Bourbon, and Traditional Sea Salt varieties. All come in 2.5-ounce bags. Duke’s is also introducing Cajun Andouille Shorty Sausages, which are smoked with real hickory hardwood and a special blend of Cajun spices. This item will be available in the spring in 5-ounce bags. Duke’s Smoked Meats Detroit (866) 558-7379 duke@dukesmeats.com dukesmeats.com

18 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

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SMALLOPERATOR

A Golden Future

As it approaches its 50th anniversary, Swiss Farms is focused on self-improvement while retaining its sense of self By Angela Hanson

n Pennsylvania, a state full of serious convenience foodservice competitors, it is easy to think that the market is dominated by large chains. But in Delaware County, small operator Swiss Farms has leveraged its strengths to cultivate an enthusiastic customer base for its drive-thru markets and maintain it for nearly five decades. “We’ve been in business for almost 50 years, and there’s something to be said about that,” said Jaclyn Daley, director of marketing. “We have a really loyal following in The Swiss Farms store in Havertown, Pa., will soon sport this new look. this area.” Headquartered in Broomall, Pa., the 13-store operator made a name for itself by and its test kitchen have allowed Swiss Farms to selfcombining the added speed and convenience of a distribute, delivering fresh products to its stores six drive-thru with staples and other items typically found days a week. in a grocery store, plus freshly prepared food that is “Whatever we make that day is going out that day restaurant quality. or the next day,” explained Justin Vignola, director of “You’re getting the types of products that you fresh food, who joined Swiss Farms last year. This selfwould either have to sit down in a restaurant to get reliance allows the company to make quick changes if or have to walk around a large-scale grocery store to it gets significant customer feedback, rather than havget,” Daley said. “We’re trying to make our product ing to go through a third party. mix drastically different than the competition, so In recent months, Swiss Farms has significantly we’re doing something you can’t get anywhere else.” enhanced its foodservice offering by launching a line of Swiss Farms isn’t content to rely on its legacy, fresh-made breakfast sandwiches; launching a premithough. Particularly since new President and CEO um coffee line; and adding signature meals to its Fresh Scott Simon came on board nearly a year ago, the Solutions line of freshly prepared meals. chain has been exploring ways to improve itself and Vignola, who has significant foodservice industry grow, while staying true to what its existing customer experience and has opened multiple restaurants, was base appreciates. brought on board to head up development of Fresh A major part of the evolution is development of Solutions. Along with creating new and improved its fresh food program, which took root in 2009 products, Vignola is developing seasonal menus. when the retailer built a commissary in the back of its The breakfast daypart is particularly important to Milmont Park, Pa., store. Since then, the commissary Swiss Farms, as a large number of its customers pass

20 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

New Perspectives on Consumers’ Eating and Drinking Behavior September 12-13, 2017 Donald E. Stephens Conference Center, Rosemont, IL

The ONLY Foodservice & Beverage Event for Convenience Store Category Managers and Executives The 2017 Convenience Foodservice & Beverage Exchange will look at today’s hottest food and beverage trends and what they mean for the future of c-store retailing. Key topics that will be addressed are: • • • • • • •

Developing tactics and strategies to overcome consumer bias of c-store foodservice Placing priority on food safety procedures Achieving restaurant margins within the c-store menu constraints Managing increased labor, spoilage and marketing costs Understanding the importance of beverage selection of build foodservice sales Analyzing sales and customer counts by daypart Trends in beverages and convenience dining

PLUS valuable time set aside for meeting with solution providers and peer networking.

For more information, visit: csnews.com/food-beverage Retailers, please contact: Don Longo, dlongo@ensembleIQ.com

Sponsors, please contact: Ron Lowy, rlowy@ensembleIQ.com

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SMALLOPERATOR through the drive-thru on their way to work in the morning. The breakfast sandwich line Vignola developed features house-made sausage, pork roll and more, and includes a lean option of egg white, spinach and cheese on a multigrain English muffin. It is a conscious choice to give customers a healthier option in every category of food. “We wanted to make a shift,” Daley said. “Not to change up the whole store into better-for-you, but a good portion of it, to be able to offer that to our customers.” The company went even farther Swiss Farms combines the speed and convenience of a drive-thru with staples typically found in by hiring dietitian Audrey Hasse, a grocery store, plus restaurant-quality freshly prepared food. whose nutrition philosophy is that “eating should be fun.” Hasse’s job is to curate betterecommerce platform are scheduled to launch this for-you food choices and develop recipes using ingrespring, and the company gave its decades-old rooster dients available at Swiss Farms. mascot a name to prepare it for a more active role in “The focus there is not only on the fresh food side, the company’s marketing. Cruiser the Rooster received but also on our traditional packaged grocery items,” his moniker after customers were invited to submit Daley noted. “Our product mix has been the same their suggestions online. for a long time, and people are more conscious today With all that’s happening inside Swiss Farms’ marabout what they’re putting into their bodies.” kets, customers will soon see a change outside as well. The Swiss Farms store in Havertown, Pa., will receive a significant facelift in the form of the company’s first “You’re getting the types of products “huge renovation,” according to Chris Gray, director that you would either have to sit down of IT/special projects. The store will remain open during construction. in a restaurant to get or have to walk Following its completion, the company plans to around a large-scale grocery store to get.” update a few more legacy stores per year. — Jaclyn Daley, Swiss Farms “We’re investing a lot in our legacy stores right now,” Gray said. While Swiss Farms has done some Along with these fresh-food and better-for-you light renovations in recent months, “we’re going to pushes, another major milestone for Swiss Farms kick it up a notch,” he added. was the June 2016 launch of its new coffee program, Behind all these initiatives is the support of new which includes three premium roasts. Since the proCEO Simon, who is spearheading Swiss Farms’ develgram rolled out, coffee sales have spiked, according to opment while balancing it with what customers have Daley. Customers especially enjoy using Swiss Farms liked about the brand for decades. milk — delivered five days a week — as their creamer. “His main push is creating growth while main“It’s the freshest milk in the area,” she said. taining a reputation as a trusted local market and strengthening ties within the surrounding communities,” Daley said. THE SWISS FARMS BRAND The continued growth of Swiss Farms could even The company is developing more than its fresh menu eventually include a Swiss Farms location outside of and product mix; it’s enhancing its brand presence, Delaware County. The company is open to expansion, too, through a combination of services and the face it but only if it can do so while maintaining its current shows the community. level of brand quality and service. CSN A Swiss Farms mobile app, loyalty program and

22 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

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cover story

By Angela Hanson & Melissa Kress

oodservice has found a permanent place among the most critical categories for convenience store retailers. C-store operators are collectively gaining foodservice category expertise, food quality is rising, and the number of Americans who decide where to fuel up their cars based on the food quality offered inside the convenience store is on the rise in recent years. In fact, it is possible for c-store retailers to raise their foodservice profit contribution to 50 percent of their total in-store profits. Industry experts and c-store operators who recently spoke with Convenience Store News were unanimous in that conclusion. They report that not only are some c-store retailers well on their way to reaching the 50-percent profit mark, but that it has already happened for some of the most successful convenience foodservice retailers — and that’s great news for the industry as a whole. “It’s absolutely a realistic goal,” said Ed Burcher, president of Burcher Consulting, a suburban Toronto company that specializes in foodservice, convenience, retail and merchandising solutions. He noted, though, that the cost of entry is not equal across the board. “The first thing to think about is how big a chain you are, how big a business you are, and where are you sourcing products based on that. All of that impacts the costs going in.” For c-stores with no foodservice program or just a limited one at this moment, it may seem too lofty a goal to seriously contemplate striving for; yet it’s worth taking steps to reach, particularly since thin margins on gasoline and heavy taxes on cigarettes mean c-stores must look elsewhere for sales they can rely on. “That can’t be your bread and butter anymore,” Ryan Krebs, director of foodservice for York, Pa.based Rutter’s Farm Stores, said of fuel and tobacco. “I believe it’s 100 percent critical, to stay competitive in today’s market, to get as deep into foodservice as you possibly can.” Rutter’s more than 60 Central Pennsylvania convenience stores boast “fresh-made food prepared just the

way you like.” The chain uses only the freshest ingredients and bakes its own bread, cookies and muffins every day. Rutter’s stores also feature café seating. WHERE THE JOURNEY BEGINS

Even the most capable retailers need to walk before they run, and those who charge toward the 50-percent profit milestone without proper preparation are likely to end their journey before they’ve gotten anywhere close to where they want to be. Margins on prepared food and hot, cold and frozen dispensed beverages are significantly better than margins on general merchandise, but if no one is willing to buy these products, the margins won’t matter. “First, your store must be clean, and your service must be outstanding. In my mind, this is the price of entry to selling food in a c-store,” said Paul Servais, retail foodservice director for La Crosse, Wis.-based Kwik Trip Inc. The vertically integrated chain of more than 550 stores in Iowa, Minnesota and Wisconsin makes much of what it sells from scratch, and vows that its customers can “count on fresh food and a refreshing, friendly attitude all day, every day.” Beyond ensuring a clean and inviting atmosphere, retailers must also lay a foundation through math and an assessment of their buying power, according to Burcher. He advises operators to review their current situation to start, determining who they’re buying from, what kinds of contracts they have, and how much they’re paying for different items. Having a clear picture of costs, where they get things and how they pay for them, makes it easier to create a strategy. “You can take that a step further: understand your recipes and your theoretical costs of the perfect product so you know what you should be achieving. Fully blown-out recipes, including yield,” Burcher said of the initial assessment process. Along with the overall increasing popularity of convenience foodservice, it is currently a good time to get into the business because for more than six months, the industry has been in a deflationary period, with product prices going down for a variety of reasons,

WWW.CSNEWS.COM | MAY 2017 | Convenience Store News 25

cover story

sandwiches are easier to customize if a retailer wants to include that option, according to industry experts. CONSTRUCTING A STRATEGY

Kwik Trip (seen here and below) vows that its customers can “count on fresh food and a refreshing, friendly attitude all day, every day.”

Burcher noted. This gives an extra boost to all foodservice retailers, regardless of size. In fact, while developing a foodservice program with an eye for the long term can be daunting to small operators, these retailers have more of a competitive advantage than they realize. Krebs advises small operators not to “get scared off, by starting with a microwave and a toaster” as just these two pieces of equipment allow them to make customizable breakfast sandwiches. Breakfast itself can serve as a solid building block for a convenience foodservice program. Consumers are more likely to visit a c-store as part of their morning routine, and a proprietary coffee program provides good profit margins, especially with self-service. Meanwhile, eggs, croissants, cheese and meat can be combined in a variety of ways to make different products out of the same ingredients, and breakfast

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While c-store operators can and should continually adjust their foodservice program in response to market conditions and customer response, they are more likely to reach the 50-percent profit goal if the roadmap to get there is built into their initial strategy. Equipment selection is a key part of that building process. Cost and quality matter, but the most important part of building foodservice profits is selecting equipment that can do multiple things, rather than going for specialized equipment. Convenience foodservice experts recommend installing a fryer for its versatility. Items like chicken fingers and mozzarella sticks can be made consistently in three minutes or less with a fryer, which fits craveable items into the convenience model. “Once you have a fryer, you can drop anything into a fryer,” Rutter’s Krebs said. A fryer also allows operators to build up foodservice order sizes through side items like French fries. Consumers are likely to purchase a side item to go with a hamburger. But if they buy a package of potato chips, more money goes to the manufacturer than the c-store. Experts likewise recommend installing convection ovens, such as TurboChef, which they say make a significant difference in the quality and variety of food a c-store can produce. While creating a foodservice program from scratch isn’t the only option — operating with a branded partner provides distinct advantages — some industry experts believe this approach is not conducive if your

cover story

“Set expectations: First, I have to build my business. Then, understand what’s reasonable inside that business.”

Ed Burcher, President, Burcher Consulting

“Make sure you have an accurate tracking system for everything that goes along with your program: waste, employee meals, coupons.”

“It starts with commitment and answering the promise to your customer daily. That should take you several years to get right.”

“We are not in the business of selling two Lamborghinis a year. We’re in the business of selling 200 cups of coffee a day. Volume is really important in that equation.”

“There is so much competition for share of stomach these days, you truly do have to earn it.”

“The customer has to come in and really feel like you are in the business. It’s right when you walk in. It’s highly visible. It looks like a store within a store.”

Joe Chiovera, Founder, XS Foodservice & Marketing

“The No. 1 thing people want now is order accuracy. Nothing worse in the world than driving down the street and realizing your order was wrong. You’re not going back; you’re just mad.”

Tom Cook, Principal, King-Casey

“You can’t be the typical, historical food that’s been sold in the convenience store — roller grill, hot dogs and that type of food. You really have to up the quality of your offerings. Really good coffee, really good baked goods, really good sandwiches.”

28 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

“If you are a margin hawk and live and die by waste numbers, you really do not stand a chance.”

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Many of the most successful convenience foodservice retailers bake their own bread, doughnuts, cookies, muffins, etc., every day.

goal is to reach 50 percent of profits from foodservice. Their rationale: Retailers have to pay startup fees and a percentage of profits to the partner. “That’s not going to get you anywhere close to 50 percent. That’s someone else’s dollar,” said Krebs, a former chef who recently introduced chef coats into Rutter’s stores. “You can’t grow your foodservice business if you

30 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

don’t have the components to build a foodservice experience for the customer,” Krebs continued. “That upfront investment of labor and equipment is what I really believe is the halt of many organizations.” THE JOURNEY CONTINUES…

Speaking of building a foodservice experience, the evolution of convenience stores as foodservice providers

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cover story

has led to much innovation around how the store is laid out. Having a seating area to dine in can signify that store is a foodservice destination, and digital signage and menu boards facilitate creativity in how items and nutritional information are presented. The actual prep area can serve as a design element, too. “Open kitchens and prep areas are very important to the customer,” said Tom Cook, principal of KingCasey, a retail consulting and design firm based in Westport, Conn. “People like to see where their food is being made. It communicates freshness and made-toorder and quality. Those are good visual cues.” In contrast to dine-in seating, drive-thru windows are worth considering where the real estate allows. While in-store ordering and dining allows for a level of socialization and engagement that drive-thrus do not, people are often willing to trade experience for convenience. Even made-to-order foodservice programs can be done with a drive-thru, as today’s consumers are more willing to wait in the car for the food to be prepared — as long as the order is both accurately pre-

32 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

Convenience foodservice experts point out that installing a fryer can give c-store operators a lot of versatility in offering hot foods.

pared and tasty once they receive it. There are a number of different paths c-stores can walk to reach success and attain 50 percent foodservice profits. Along the journey, they must stay aware of how achieving this milestone will fundamentally change how the market perceives their business. “At this point, you are a restaurant, not a gas station,” Kwik Trip’s Servais said. CSN

Looking Ahead, Not Back

QuickChek celebrates its golden anniversary with new vigor

Q By Don Longo

who joined the company in February in the newly created position of senior vice president of merchandising and marketing. Easley possesses nearly 25 years of retail experience in marketing, strategy and operations, including 16 years with leading independent grocer H-E-B, as well as chief operating officer at Rite-Aid, at Westlake Ace Hardware and with Earth Fare, one of the leading natural and organic food retailers in the nation. “We are very pleased to have Rob Easley join our senior management team,” said QuickChek CEO Dean Durling. “While we are celebrating our first 50 years, Rob’s strong background in marketing, strategic planning and operations will help us grow to the next level as we look to our future.” QuickChek also announced several internal promotions. Don Leech, who has been with the company for 31 years, including the last 14 as a director of operations, has been promoted to vice president of real estate and development. Leech began his career at the company’s Middletown, N.J., store in 1985 and has held positions of assistant store leader, district leader, and director of operations. Robert Porcelli has been promoted to director of operations for Region 2. He began his career as an assistant store leader in Franklin, N.J., in 2005 and has been promoted several times during his career to store leader, district leader in New Jersey, and most recently district leader in New York. The company also announced the internal promotions of Matt Murphy, Jennifer Quiles and Kevin Woodring as district leaders. QuickChek did say goodbye recently to longtime sales and marketing executive John Schaninger, who left the company after 38 years QuickChek team members celebrated the 50th anniversary at its Dunellen, N.J., store on March 15. uickChek Corp., the family-owned fresh convenience market chain based in Whitehouse Station, N.J., gave away free large hot coffees and 20-ounce iced coffees to all patrons visiting its store in Dunellen, N.J. — the chain’s very first store — on Wednesday, March 15 from 12:01 a.m. through midnight to mark its golden anniversary. However, the coffee giveaway doesn’t come close to illustrating the full 50-year story of this regional innovator that is moving into its next half-century with new vigor — opening new stores, expanding into new markets, and hiring more team members. QuickChek has opened 40 new stores and hired an additional 1,400 people since 2007. The retailer in February opened new 5,496-square-foot stores in North Brunswick and Cedar Knolls, N.J., and the chain opened its first store in Long Island’s Nassau County this April. Its steady growth enables it to attract and maintain top talent. One of those talented people is Rob Easley,

34 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

QuickChek is the first retailer in the convenience store industry to provide selfcheckout to customers.

to pursue other interests. Schaninger joined QuickChek in 1978 as an assistant manager and grew into a number of positions with increased responsibility, including district leader, Region 1 vice president of operations, and in 2004, vice president of sales and marketing. “We are committed to being a great place to work, a great place to shop, and a great place to invest,” said Durling, whose company enjoys the rare distinction of being named one of the best places to work in both New Jersey and New York State. “We strive to create a positive experience and environment where core values are nurtured, hard work is rewarded, and leadership is cultivated. As our team managers have input into this selection, this recognition confirms we remain on the right track.” QuickChek also believes in being not just the preferred neighborhood shopping destination, but a part of the community itself. The retailer supports more than 150 youth sports organizations throughout New Jersey, New York’s Hudson Valley and Long Island. Whenever the company opens a new store, it raises funds for a local youth organization in that town, donating 25 cents from every sub, sandwich and wrap sold during the new store’s first 30 days to that organization. QuickChek has also raised millions of dollars to support a variety of causes benefitting children, families and military veterans. THE QC HISTORY

The QuickChek story actually began almost 130 years ago when Durling Farms was founded by Augustus Durling in central New Jersey in 1888. Over the following 79 years, the Durling Farms brand grew to be synonymous with quality milk and dairy products, delivered fresh to the customer’s door. In 1967, Augustus’ grandson, Carlton C. Durling, founded QuickChek to ensure that loyal Durling Farms

36 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

QuickChek stays true to its mission: to be a great place to work, a great place to shop, and a great place to invest.

customers had a neighborhood shopping destination customer wants, which is high-quality, great tastnot only for their milk, but for a full range of deli ing food and beverages close to where they live and and other food products. He opened the very first work,” commented Durling. QuickChek store on March 15, 1967 in Dunellen. This commitment has driven the company to Today, under the leadership of Dean Durling, define the term “fresh convenience” and remain the Carlton’s son and Augustus’ greatmarket leader in foodservice, fresh grandson, QuickChek is a market coffee, fast fuel and friendly people. “We strive to create a leader through innovation and its QuickChek’s menu is designed for positive experience and personalization, whether it’s made-tofocus on fresh products and friendly employees at 148 stores in the New environment where core order sandwiches, the extensive coffee York/New Jersey metropolitan area. wall, or the handcrafted hot and cold values are nurtured, hard beverages available at the in-store Q QuickChek was named the Convenience Store News work is rewarded, and Cafés. Customers get what they want Foodservice Innovator of the Year any time of day or night. leadership is cultivated.” in 2016. The annual Foodservice “Being an innovator means — Dean Durling, CEO, QuickChek Corp. not only creating new menu items Innovators Awards program, sponsored by Tyson Convenience, and having freshly made in-store recognizes the best of the best in convenience bakery items, but also embracing technology to confoodservice. Two years earlier, QuickChek was named tinue to meet the needs of our customers,” Durling Hot Beverages Innovator of the Year in the awards told CSNews. “You can use an in-store touchscreen program and that same year, its renowned fresh or your smartphone to create a custom sandwich or brewed coffee was voted best in America in a national drink, which we will handcraft to your order. We have consumer survey. self-checkout counters and continue to expand our “Our company has been built on total customer mobile ordering to provide even greater convenience dedication and we remain committed to what our for our on-the-go customers.” Its 50th anniversary celebration aptly had The first QuickChek store opened a technology angle as well. The celebration in in Dunellen, N.J., in 1967. Dunellen on March 15 was followed by 50 additional offers over the next two months covering QuickChek’s menu of fresh food, beverages and on-the-go snack items. The promos ranged from free coffee and fountain drinks to buy-one-get-one offers. Consumers were encouraged to enjoy additional convenience and savings by downloading the QuickChek mobile app, which always rewards loyal customers with a free coffee after they purchase six coffees. CSN

38 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

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A Better-for-You

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More c-store operators are open to adding healthier products, but deciding which kind and how to market them can be a challenge

By Angela Hanson

hile some stereotypes persist, consumers no longer view convenience stores only as a destination to purchase tasty but unhealthy snacks and drinks. Increasingly, offering healthy and better-for-you products is an avenue c-store retailers are exploring to stay competitive — but this relatively new shift brings stumbling blocks, as well as opportunities. Americans want to improve the quality of their diets, but it’s not as simple as cutting calories and trading chips and candy bars for cut veggies and fruit cups. The fact that there is no one-size-fits-all way of building a healthier product lineup is one of the first challenges c-store operators must face. Whether they operate in an urban, rural or suburban marketplace, all c-stores have customers with a wide variety of opinions on what it means to eat healthier. “Healthy and better-for-you are very broad terms and mean something different to each of our guests,” said Erica Flint, a registered dietitian who does food research and development for Kwik Trip Inc., the La Crosse, Wis.-based chain of 550-plus convenience stores. “As is the case with anything, different health trends pop up with guests looking for items that align with those ideals.” One constant, though, is that the majority of c-store customers are not in search of purely functional foods. Rather, they want snacks that are healthier, but still fulfill their craving for something tasty. According to Greg O’Neal, vice president of marketing for snack company Thanasi Foods — which aims to make “simple, healthy snacks that taste

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anything but simple” — consumers in search of better-for-you items are most interested in the following set of attributes: • Real Food: “There is definitely a movement toward real, rather than artificial; foods with transparent ingredient labels,” O’Neal said. • Protein: Demand for high-protein food is on the rise, with 50 percent of Americans actively looking for it in the foods they buy and consume. • Craft: The term doesn’t just apply to products found in a beer cave. When it comes to snacks and other food, consumers are also looking for more craft and less mass-produced products. “What happened in craft beer is happening in snack food for sure,” he said. • Snacking as Meal Replacement: The trend of snacks as a meal replacement instead of a meal supplement is on the rise. Large, full meals are being replaced by smaller portions to help consumers eat less and eat on the go. This ties in with the increased demand for protein, as meat-based proteins make a good meal replacement. • Low/No Sugar: More people are discovering how much sugar can hide in otherwise healthy snacks and cutting back on their sugar consumption. While overall food and beverage sales remain healthy at convenience stores, the healthy snacks category is outpacing the total market in sales growth, and industry insiders say it’s because the category delivers on many of the most-valued attributes. However, identifying the specific better-for-you products that are right for a particular store may take more time and effort than simply placing the best-known brands on the shelves and waiting for the profits to roll in. It might be a process that requires multiple attempts. “If a particular item doesn’t work, it doesn’t mean your guests aren’t looking for healthy offerings. It may just be the specific item that was chosen isn’t what they are looking for,” Flint said. “Communicate with your guests and solicit feedback. Even small incremental changes count.” It’s important to note that any new better-for-you products a retailer adds should always be convenient and affordable, meeting consumer expectations of what they will find at a convenience store. This doesn’t mean prices have to be the lowest of the low, as consumers have demonstrated a willingness to pay more for premium products with high-quality ingredients. In addition to keeping up-to-date on market research regarding consumer trends, store operators

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Any better-for-you products a c-store adds should still be convenient and affordable.

can receive guidance from the U.S. Department of Agriculture’s (USDA) Food and Nutrition Service. In January, the USDA published the “Healthy Corner Store Guide” in English and Spanish. The guide provides strategies for marketing healthier products, sourcing healthy food and beverages, and making effective changes to the way products are displayed. HEALTHY PARTNERSHIPS

Also in the guidance department, several larger c-store chains have teamed up with the Partnership for a Healthier America (PHA), a nonpartisan, nonprofit organization whose goal is to make healthier choices more affordable and accessible to families across the country. Kwik Trip, Enmarket, Twice Daily and Sheetz, among others, have made multi-year commitments to PHA. McLane Co. Inc. became the first convenience distributor to partner with PHA and used its criteria to develop multiple products for its new Consumer Value Products private-label line. For Kwik Trip, working with PHA was a natural extension of its food and beverage development efforts, especially as the retailer saw an increasing number of its customers looking for healthier alternatives. Kwik Trip also began offering a free piece of fruit to employees each working day, which was “extremely well-received,” according to Flint. “Our first commitment back in 2014 involved having fresh fruits and vegetables, low-fat dairy and whole grains as part of our food offerings,” she said. “We also added a Healthy Concessions program and Eat

Kwik Trip, whose proprietary brands include Nature’s Touch, is a partner in the Partnership for a Healthier America.

Smart guide. We have added bike racks to our new store locations.” THE RIGHT PRODUCT MIX & MERCHANDISING

Whether or not c-store operators choose to engage outside help, there are multiple tactics they can use to curate a healthier product mix and make it as effective as possible. For instance, some industry sources report that yogurt and granola bars are doing especially well in the c-store market, as products that come in portable, single-serve packaging are ideal for c-store shoppers who visit as part of their daily routines, particularly to and from work. Enmarket, operator of roughly 60 convenience stores throughout Georgia, South Carolina and North Carolina, has discovered that whole fruit, fruit cups and nutrition bars are the items making the biggest impact on the chain’s bottom line; and something as simple as line of sight can make a significant difference in how better-for-you offerings are received.

“We’ve found that a dedicated gondola section with signage calling out ‘Healthy Snacks’ is most effective in merchandising the better-for-you snacks,” said Matt Clements, director of marketing for Savannah, Ga.based Enmarket. “With fresh fruit, placement near the front of the store is critical due to the shorter shelf life of these items.” Flint agrees that calling awareness to new healthy products can make a big difference, and she noted this doesn’t only apply to customers who are physically inside the store.

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“Market it outside of the store as well as in,” she advised. “Perhaps you’ll find a new guest who didn’t purchase [from your business] before because they couldn’t find anything healthy to eat. Find a way to draw them back in.” The product lineup itself should be curated to drive incremental sales. More is better, but only to a point — consumers enjoy choice, yet stocking too many versions and brands of the same product type can ultimately work against a store. “It’s not uncommon to see a c-store snack set filled with a lot of redundant products. If you look at a meat snack set, for example, you may see several of the same exact flavored beef jerkies or meat sticks from the same and/or different brands,” said O’Neal. “The recommendation for retail partners would be to offer a smaller mix of

those products and also offer a wider assortment of unique premium SKUs with different flavor profiles, meat types, or product formats.” This will deliver sales from existing category buyers, while drawing in new non-category buyers who are interested in unique, premium or healthier options, according to O’Neal. When the product mix is properly managed and curated to suit a store’s specific customer base, offering healthy items can create a win-win scenario for c-stores and customers alike. Increased access to healthier food and beverages makes a positive impact in the lives of customers, while offering a wider assortment of betterfor-you, premium and differentiated on-trend products drives incremental sales and profits for retailers. CSN

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Elevating the Fuel Pumping Experience

From EMV upgrades to touchscreens to audio greetings, the fuel pump is becoming more interactive and enabling operators to increase profits in-store By Tammy Mastroberte

he constant innovation around technology is catching up to convenience store fuel pumps, as c-store operators look to provide a more interactive, engaging and entertaining experience to customers as they are fueling up their vehicles. And in some cases, elevating the experience is also allowing them to upsell products and services available inside the c-store, directly benefitting the bottom line. Whether it’s video monitors advertising in-store products while keeping consumers up-to-date on local news, or customers placing a foodservice order while at the pump, today’s c-store operators are stepping up their game on the forecourt. “We are always looking to see how we can give customers a more interactive and hasslefree experience at the pump,” Joe Brecknock, director of brand and communications at Chicago-based BP, told Convenience Store News. “Our insights show customers want to get through the pumping experience quickly and for it to be as seamless as possible, which is

48 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

BP’s “Personality Pump” named Miles uses proprietary interactive technology to audibly greet customers and initiate the fueling experience.

a reflection of how customers want all their experiences to be, whether it’s gas or a cup of coffee. They want it fast, easy and smooth.” In the CSNews 2016 Technology Study, c-store retailers reported an increase in their use of fuel pump technology — particularly video monitors, which increased in use by more than 7 percent from the prior year; and merchandise ordering at the pump, which jumped from 1.9 percent using the technology in 2015 to 7 percent in 2016. Last year, Nashville, Tenn.-based Tri Star Energy LLC, operator of 86 c-stores, started utilizing the NewsBreak Media Networks platform at its pumps. The program runs on a five-minute loop broadcasting news, weather and other related information, along with targeted advertising to encourage customers to go into the store. The chain reported that it saw in-store

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MOTOR FUELS

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sales increase considerably after implementing the technology. Additionally, Quality Oil Co. in Winston-Salem, N.C., recently started offering Linq3’s Play at the Pump lottery technology so customers can play the lottery while fueling up, and BP unveiled its “Personality Pump” named Miles, which uses proprietary interactive technology to audibly greet customers and initiate the fueling experience. “We set out to see how we could turn the three or five minutes at the pump into less of a chore and make it more interesting and fun to do,” BP’s Brecknock explained. “When you drive up, it activates the pump with a motion sensor and as you get out of the car, Miles will greet you and invite you to play some music.” BP partners with Pandora to offer a large selection of music — pop, rock, holiday and country — that can be played at the pump. Customers can also interact with Miles in other ways, such as trivia games or creating an e-card. “The customer will stand in front of the pump and strike a few poses, which are stitched together in an e-card that we can send to their cell phone if they enter their phone number,” Brecknock shared. “There is also a filter that takes a photo of the customer and shows up on the screen. If they picked pop music, it will create them in that persona. This can be sent to the phone as a photograph as well.” BP also partners with news satire organization The Onion for content, including some of the trivia, scripts used for audio, and videos that introduce the concept of Miles to the customer. BP initially launched Miles at one location in Brooklyn, N.Y., and two in Chicago, with the plan being to test it through February 2017 to see what consumers like and interact with the most, and how much interest it generates overall. “…It’s really quite different, and the first of its kind for this type of innovation at the pump,” Brecknock said. EMV AS A CATALYST

Many c-store operators are working to install EMV at the pump, and this upgrade is prompting them to introduce other technologies for use now and in the future. EMV is an acronym for Europay, MasterCard and Visa, the three companies that originally created the new security standard for credit cards.

50 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

The Seasons Corner Market chain reports that it has “found a lot of value” in the data-driven content provided by Applause TV at its fuel pumps.

To become EMV compliant, Colbea Inc. dba Seasons Corner Market, based in Cranston, R.I., installed Gilbarco Veeder-Root’s Passport POS with EMV functionality and FlexPay IV terminals at the pumps across its network of more than 100 stores. While doing so, the retailer also installed Applause TV as part of the upgrade. “Offering EMV at the pump helps to ensure customer payment security and reduction in fraudulent purchases, so we’re happy to assist customers in this way,” said Michael Schiemer, digital marketing manager at Colbea. “We are always looking to stay ahead of the curve with technology and ways to maximize transaction security. We have found a lot of value with Applause TV providing data-driven content at the pumps to drive in-store sales. It’s also useful for the customer to enjoy personalized media and useful coupons. Overall, it’s really a win-win situation for everyone.” The new Gilbarco terminals also support NFC, mobile wallets, encryption and 2D barcode scanning, offering customers a number of payment options, Schiemer said, adding that the Applause TV addition provides them the opportunity to connect with the customer and drive foot traffic into the store. Colbea promotes a select number of featured

POLICY

TRADING

TAXES

INNOVATION

SERVICE

INSIGHT

MOTOR FUELS

Gasoline + Diesel + Ethanol + LNG/CNG + Electric

products using video advertisements, including its coffee program. “In addition to increasing store sales directly, we also offer customers other calls to action to go inside our stores, such as donating to one of our charities or filling out a job application,” Schiemer added. “Everything we do boosts sales directly or contributes to improving our bottom line in the end.” The content for Applause TV is customized for the consumer, with specific in-store products featured each month, and it varies by daypart. For example, advertisements for coffee or energy drinks will appear in the morning; food items will display around lunchtime; and snacks or sweets will be shown in the evening and overnight. The content also varies on the weekends and holidays, and is customized according to customer data, including demographics and purchasing behavior. The data is used to display relevant entertainment, news, sports, commercials and coupons.

“

If we needed to replace the equipment for the EMV mandate, we wanted to make it the best long-term solution.

”

— Scott Hartman, Rutter’s Holdings Inc.

“Overall, our customers prefer the fueling experience with pumps featuring Applause TV, and we convert a high number of customers fueling up,” explained Schiemer. “The better and more personalized the customer experience, the more likely they will stop at our locations instead of competitors.” Another c-store chain taking the EMV mandate a step further is Rutter’s Farm Stores, based in York, Pa., and operating 66 locations in central Pennsylvania. The chain is upgrading to the NCR OPTIC Solution at the pump, which accepts EMV, magnetic stripe, contactless, mobile wallet and 2D barcode scanning. “If we needed to replace the equipment for the EMV mandate, we wanted to make it the best longterm solution,” said Scott Hartman, president and CEO of Rutter’s Holdings Inc. “We were looking at the best combination of both the EMV payment methodology solution, combined with how that could

52 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

Rutter’s Farm Stores is upgrading to the NCR OPTIC Solution, which accepts EMV, magnetic stripe, contactless, mobile wallet, and 2D barcode scanning.

improve our customer interaction at the pump.” The NCR OPTIC Solution, which offers two different sizes of screens, is a combination of the EMV payment method and either 5-inch or 12-inch screens at the pump that present opportunities for interaction and marketing with customers. The solution offers an open source platform, so instead of prepacked marketing from a national media company, Rutter’s can develop and insert its own content, according to Hartman. Furthermore, it’s an interactive touchscreen that allows customers to do multiple things, just as they would at a selfserve kiosk. Rutter’s views the rollout as a multi-phase project. “We have smaller screens that sell car washes, but they are not interactive or very big. The largest is probably three by three inches. It does have the option of audio, and we can enhance our car wash sales, and will even have the functionality of selling lottery tickets,” Hartman noted. The retailer started the rollout this year. The EMV payment method will be delivered in the spring, but won’t be in place right away, he said. Ultimately, the screens will provide Rutter’s with opportunities to inform customers about the products offered inside the c-store. For example, Rutter’s stores just began selling beer, so this would be a way to let customers know that, Hartman said. CSN

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FOODSERVICE

Category Trends + Insights from

TRENDSIGHTS

Growing in a Challenging Environment Improving economy, confident consumers, and still-low gas prices drive c-store traffic growth

I By Bonnie Riggs Restaurant Industry Analyst, The NPD Group www.npd.com

n 2016, the U.S. economy grew at the same slow and steady pace it has since the Great Recession, but consumers — who had been uncertain in prior years — began believing that “things” were getting better. Consumer confidence reached a nine-year high in December, and optimism was expected through early 2017. On top of this favorable news were still-favorable gas prices. All of these factors, along with the

consumer’s unending quest for convenience, contributed to 1-percent growth in conventional convenience store visits last year. Although the gain is modest, it is still growth in a challenging retail environment. By conventional c-store type, flat growth at traditional chains and major oil c-stores was offset by 2-percent traffic growth at small chain/independent c-stores. The average number of visits to a c-store within a 30-day period remained flat at 5.6 in 2016 compared to a year ago, according to NPD’s Convenience Store Monitor, which captures consumer feedback pertaining to their c-store purchasing behavior.

Convenience Store Channel Traffic

C-STORE BUYER BEHAVIOR

The number of visits to a c-store in the past 30 days

+1%

8,432,584

8,500,616

YE Dec 2015

YE Dec 2016

-1%

2,123,723

2,132,849

2,087,343

2,180,735

2,099,689

4Q15

1Q16

2Q16

3Q16

4Q16

Source: NPD’s Convenience Store Monitor — Past 30 Day Database

Convenience Store Product Average Check

The average dollars spent per buyer per visit on products at their last visit +4%

$9.76

$10.12

4Q15

1Q16

$10.29

2Q16

$9.92

$10.18

3Q16

4Q16

Source: NPD’s Convenience Store Monitor — Last Visit Database

54 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

+5%

$10.96

YE Dec 2015

$10.12

YE Dec 2016

The average number of units purchased per c-store buyer held steady at 2.7, but the average check increased by 5 percent to $10.12. Purchase incidence of cigarettes/tobacco products and lottery tickets increased, while nonalcoholic beverages declined compared to the prior year. Sweet snack and alcoholic beverage purchases were flat. In 2016, super heavy c-store buyers — those who made eight to 13-plus visits in a 30-day period — gained share. Meanwhile, visits by light buyers — those who made one to three visits in a 30-day period — declined. Keeping an eye on this shift will be important because light buyers still make up the majority of c-store shoppers. Light buyers increased their average check size by 7 percent to $9.87 vs. a year ago, while super

FOODSERVICE

Category Trends + Insights from

Fresh Food Prepared Onsite Purchase Incidence by Census Region Percent of buyers who purchased a product at their last visit

Source: NPD’s Convenience Store Monitor — Last Visit Database

heavy buyers are spending 5 percent less with their average check decreasing to $9.57. C-STORE FOODSERVICE

Last year, 10 percent of c-store visitors reported purchasing fresh food prepared onsite at their last c-store visit, which was a 0.5 share-point increase over the year-ago period. The foods that increased their percent of buyers purchasing included subway sandwiches/hoagies, hot dogs or sausages, breakfast sandwiches, pizza, chicken and burgers. The breakfast foods and chicken (wings, fried chicken and chicken nuggets) categories also grew buyers. The percent of buyers who purchased fresh food prepared onsite

at a c-store at their last visit grew the most in the Middle Atlantic region, followed by West North Central, South Atlantic, and West South Central, in rank order. The least growth in percent of buyers purchasing fresh food occurred in the East North Central and Mountain regions. WHAT’S IN STORE FOR 2017

The convenience channel realized growth in 2016, yet the same cannot be said of other retail channels. C-store operators who held on to their base did so because they offered their customers the right product mix, selection and quality. As long as the needs of customers remain in focus, the future will be bright for c-stores. CSN

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In With the New

How Las Vegas-based Speedee Mart keeps its tobacco business steady By Melissa Kress

nything goes in Las Vegas, making it the perfect market for convenience store chain Speedee Mart to operate in — especially when it comes to the backbar. Speedee Mart Operations Manager Ray Johnson has previously pointed out while presenting at industry events that tobacco was 40 percent of sales when he entered the convenience retailing business in 1979, and it’s still 40 percent of sales today. Keeping up with the category means taking risks and not being afraid to try new things. “I keep an eye out for new products and go after them,” Johnson said. “You can’t wait. I never want to be a ‘me too’ store.” Speedee Mart was one of the first to fully embrace not only electronic cigarettes, but also vapor products in general. In a town that has been a hotspot for vape shops, the chain practically had no choice. And now, the c-store retailer is well positioned to capture the vapor consumer with the future of vape shops in question because of regulations in the Food and Drug Administration’s final deeming rule that may classify some vape shops as manufacturers. Never one to stand still, the chain continues to bring in new products. The latest addition to Speedee Mart’s vapor segment is the Cue Vapor System, a product by E-Alternative Solutions, a sister company of Swisher International Inc. The Cue Vapor System allows consumers to vape with just the push of a button. Designed without coils to change or tanks to fill,

Not afraid to take risks, Speedee Mart continually brings in new tobacco products.

58 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

Speedee Mart was one of the first c-store chains to fully embrace vapor products.

the system works with a click-in, pre-filled, leak-proof cartridge. The product rolled out nationally April 1. Also new to Speedee Mart’s backbar is Japan Tobacco’s LD cigarette brand. Billed as a low-price cigarette, Johnson said he’s worked with the company to sell singles and two-packs for a higher price and put all manufacturer funding toward promoting carton sales. As a result, the LD brand “is the lowest-priced carton in Nevada,” according to Johnson. “The first month (February), we sold over 100 cartons at the carton price of $37.99,” he reported. “I have front door price signs for the $37.99 [LD carton], and placement on the cigarette rack with only the carton price showing.” Coming down the pike now, Speedee Mart is gearing up to add heat-not-burn products to its tobacco business. Heat-not-burn uses real tobacco, but instead of burning it like traditional cigarettes, the tobacco is heated and delivers a tobacco-flavored vapor. The burning of tobacco reportedly forms the most harmful compounds found in cigarette smoke. Johnson is also keeping an eye on the possibility of legalized marijuana coming to Nevada — but for a different reason than selling it. “My biggest concern is over state-legalized marijuana hurting sales in the tobacco and beer categories,” he said. CSN

TECHNOLOGY

Enterprise + POS + Digital + Payment Systems + Business Intelligence

Marketing to Today’s Mobile Consumer

Convenience stores and other small-format retailers are leading the way in mobile marketing By Renée M. Covino

onvenience stores are scoring more in-store impulse purchases by hitting customers right in their back pockets, or wherever they keep their smartphone. It makes sense that on-the-go consumers respond to on-the-go incentives, and that is why forward-moving convenience stores are going mobile — with marketing technology, that is. Last year proved to be a “blockbuster year” for the mobile offer industry, with small-format retailers (including convenience stores) out in front. Mobile offers are more popular than ever, with 104 million mobile coupon offers in the United States alone, according to Koupon Media’s third-annual State of Mobile Offers report, released this January. Highlights of the report include: Cross-Channel Distribution Drives Success. The number of digital channels used to deliver an offer has an exponential impact on its success. Campaigns that use as many as seven or more channels (local search engines, thirdparty mobile apps, proprietary mobile apps, various social media, various online reviews/ratings, etc.) see an average of more than 200 million offer views. Connected Cars Are Driving New Engagement Opportunities. The connected car services market is expected to reach $150 billion by 2030, creating new opportunities to reach

60 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

consumers on-the-go. In 2017, Koupon Media forecasts that they will deliver three times more connected car campaigns than the company did in 2016. Small-Format Retailers Are Outpacing Larger Retailers in the Mobile Offer Industry. In 2015, smallformat retail categories — drug, dollar and convenience stores — outgrew larger-format stores, such as Target and Walmart, by almost 400 percent. Bill Ogle, CEO of Dallas-based Koupon Media — which, in addition to conducting mobile offer research, provides mobile content for more than 29,000 smallformat stores — has a theory as to why c-stores and others in the small-format space are growing, and will continue to grow, much faster with mobile marketing than larger-format stores. It basically boils down to e-commerce delivery, he told Convenience Store News. Because of the popularity of grocery stores with delivery, online specialty retailers, and even online food delivery from restaurants, “the number of physical stores for the larger-format chains is slowing dramatically vs. the growth rate for small formats,” Ogle said. “Also, consumers are going to pre-plan something like a big-screen TV purchase; they typically research it, then buy online. But in convenience stores with impulse items, they will just pick up what they need and go.” THE MILLENNIAL FACTOR

The convenience channel is becoming a more attractive retail channel to millennials and young adults, especially if the channel incorporates mobile offers. “Convenience is so important to these folks, and they like the fact that they really don’t have to do anything to get an offer for a convenient food item, for example, in a store that’s convenient. The offer is made and stored on their phone, it’s scanned from the phone, and they can come back out, eating the item as their gas is finishing [pumping],” Ogle explained. It’s important to note convenience retailers don’t

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TECHNOLOGY

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necessarily have to have their own mobile app to reach consumers with in-store impulse offers. “Most times, only about 5 percent of customers will download a store’s app due to their phone being cluttered. So, mobile marketing for c-stores often includes more SMS texting programs and email blasts,” relayed Ogle. C-stores shouldn’t limit themselves to either storebrand-only or national-brand-only mobile offers, but rather incorporate both, he advised, recognizing that private-label coffee and roller grill offers, as well as Mountain Dew and Hershey offers, for example, are equally important — sometimes with the same customer. While Koupon Media does not have an app of its own, per se, the mobile content provider is aligned with one in the fuel realm: the GasBuddy app. This past October, Koupon Media teamed up with the company behind one of the most popular ways c-store consumers find the cheapest gas prices in town. Just prior to the Koupon Media partnership, GasBuddy underwent an overhaul that ushered in a new brand, logo, and mobile app changes intended to connect consumers with retailers beyond just gas prices. The new GasBuddy app provides ratings of gas stations and convenience stores, similar to Yelp, along with updated games and challenges. “GasBuddies are very vocal about their customer experience at fuel stations and c-stores, and they want to tell other GasBuddies what they care about and what is most valuable for fellow consumers to know,” said Amina Altaf, director of product marketing for GasBuddy. “To cultivate this information, for the benefit of both consumers and c-store owners, GasBuddy implemented an online ratings and reviews system that specifically touches on the industry-specific categories we’ve determined our users care about most, from customer

Mobile App Adoption Nearly one half of c-store chain retailers now offer a mobile app. This number continues to rise significantly year over year, increasing by 8 percentage points compared to 2015 and by 18 percentage points vs. 2014. Aside from store location services, fuel prices and coupons are the most popular features of these apps. DOES YOUR COMPANY HAVE A MOBILE APP FOR CONSUMERS?

47.2%

CURRENT

52.8%

S YE

38.9%

YEAR AGO

S YE

61.1% NO

Source: Convenience Store News Market Research, 2016

service to cleanliness to the quality of their coffee.” Clearly, it’s not just about fuel anymore for on-thego convenience store consumers, who now include millennials, commuters and soccer moms; and who, according to Altaf, utilize mobile marketing cues from apps like GasBuddy more and more. “C-store retailers can leverage the redesigned GasBuddy app to promote their products and services through special offers or challenges to customers who are seeking more convenient, local shopping experiences,” stated Altaf. United Refining Co., operator of the Kwik Fill, Red Apple and Country Fair convenience store chains, is one retailer that’s signed on with Koupon Media to deliver mobile offers to its customers, tying in Kwik Fill’s loyalty program. The retailer’s mobile offer program is delivering personalized and targeted incentives to Kwik Fill customers, intended to ultimately increase in-store purchases and link loyalty back to its rewards program. APP DATA & MORE

The new GasBuddy app provides ratings of convenience stores and gas stations on attributes such as customer service, cleanliness and coffee quality.

62 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

The CSNews 2016 Technology Study found that nearly half of chain c-stores, or 47 percent, now offer a mobile app, a solid 8-percentage-point increase over

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TECHNOLOGY

Enterprise + POS + Digital + Payment Systems + Business Intelligence

the prior year, and an even more robust 18-percentagepoint increase compared to 2014, when just 29 percent of c-store operators indicated they were offering a mobile app. However, another way chain convenience stores are attempting to draw shoppers to their stores is via social media, and the study showed an apparent shift in the social media networks c-store operators are using to promote. It’s probably no surprise that Facebook was still No. 1, with nearly all chains (98.6 percent) using this avenue. Yet, Instagram saw the biggest year-over-year jump and is reportedly being used by approximately one-third of c-store chains. Another study backs up the social media findings across retail channels — according to the annual State of Retailing Online 2016: Marketing and Merchandising report conducted by the National Retail Federation (NRF) and Forrester, 92 percent of retailers are investing in social media marketing to some degree this year, second only to email (94 percent). “Retailers are not only increasing their social media budgets, but they are looking at new ways to update their online content and stay on top of new trends to continue to grow their customer acquisition online and in-store,” said NRF Senior Vice President Vicki Cantrell. Other topline mobile-marketing findings from the latest CSNews Technology Study were: • Aside from store location services, fuel prices and coupons are the most popular features of convenience store mobile apps. • 92 percent of those surveyed are investing in promotional/sales technology, with video monitors being the “big winner.” • Text messaging to customers and merchandise ordering at the pump also exhibited strong yearover-year growth. Local search engine optimization (SEO) is another part of the mobile marketing mix for c-stores. The goal of SEO is to put businesses in front of local searchers before they make a purchase, at the very moment they are compelled to make a decision. Local SEO increases search visibility and ultimately drives motivated buyers into stores, according to Thomas Stern, senior vice president for ZOG Digital, an independent digital marketing company based in Scottsdale, Ariz. Data released by Telmetrics found that 90 percent

64 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

of mobile searchers looking for either gas stations or convenience stores online converted into sales. Sixtysix percent of those local searchers said they wanted to buy something locally within an hour. THE GOLDEN AGE?

Mobile technology and mobile marketing are making way for the golden age of convenience stores, according to industry experts. The channel continues to push boundaries with local search engines, online reviews and ratings, third-party mobile apps, proprietary mobile apps, and social media. Matching up physical stores with digital technology is where it’s at, observed Cosmas Wong, CEO of New York-based Grey Jean Technologies and advisor for technology startups. “C-stores need to carefully consider how they can better leverage technology to deliver the experience customers want.” Convenience stores have a “tremendous opportunity to leverage new technology” in the mobile marketing space, echoed Curtis Tingle, chief marketing officer at Valassis, an intelligent media delivery provider based in Livonia, Mich. As they move forward, “the key challenge for c-stores will be to identify consumers who are open to shopping their stores — within close proximity — and reaching them on-the-go to make them aware of the new offerings and great value they bring for meal solutions,” Tingle said. Embracing technology such as mobile apps is part of how c-stores are shaping their future by remaining sharply competitive, added Mark Hardy, CEO of Chicago-based InContext Solutions, a virtual reality solutions provider for retailers like 7-Eleven and Walgreens. “Omnichannel shopping is quickly becoming the new norm, and the sooner c-stores adopt new technologies, the faster they can cater to the latest consumer trend,” Hardy stated. It all boils down to convenience store operators being smarter about utilizing smartphones as the way to virtually tap customers on the shoulder. “Since smartphones and social networking exploded into the mainstream, customers have had access to information at their fingertips 24/7. They are increasingly using their mobile phones and search engines, in particular, to find information on local businesses. For c-stores, the original hyperlocal retailer, this holds great promise and presents a great opportunity to get their brands in front of a captive audience,” GasBuddy’s Altaf concluded. CSN

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EXPERT’SVIEW NEW Horizons

Why Men Need to Champion Women Leaders It’s good for them, good for you, and good for the bottom line

ulie Fajgenbaum, founder and CEO of the custom photo album service Tweed Wolf, vividly remembers the moment a male mentor changed the course of her career. While working as a director at American Express, a vice president By Nancy Krawczyk, position opened up and her male Network of boss encouraged her to apply. Executive Women “I would have been jumping the queue of other directors with more tenure,” she remembers, “but my boss told me: ‘If not you, who?’ He meant, ‘Who is more qualified and could do a better job?’ I applied and got that job.” Mentors — who provide guidance and advice — are helpful to anyone’s career. Sponsors — who raise your profile, foster your development, and advocate for your career — are critical. Having a male sponsor is especially important for women, because most women work in companies where the leadership structure is dominated by men. Most companies don’t require senior leaders to hire, mentor and sponsor women, or to expend their

Convenience Store News is pleased to continue this series of exclusive educational columns by the Network of Executive Women (NEW), coinciding with the annual CSNews TOP WOMEN IN CONVENIENCE Top Women in Convenience awards given out each fall. More than 60 female managers, executives and directors who work in the convenience store industry were honored in our 2016 program. In addition to being a presentation sponsor for the Top Women in Convenience program, NEW

66 Convenience Store News | MAY 2017 | WWW.CSNEWS.COM

professional capital advocating for women’s development and advancement. Few firms tie compensation to gender and diversity goals. The result? In S&P 500 retail companies, where nearly 55 percent of all employees are female, women hold 41.1 percent of first and mid-level management roles and just 30.1 percent of senior and executive management positions, according to Catalyst, a

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EXPERT’SVIEW NEW Horizons

nonprofit organization whose mission is to expand opportunities for women and business. The business case for engaging men in gender diversity initiatives is clear. In its 2015 report, “Diversity Matters,” worldwide management consulting firm McKinsey & Co. revealed that companies in the top quartile for gender diversity were 15 percent more likely to outperform those in the bottom quartile. Gender parity correlates with increased sales revenue, more customers, and greater relative profit. There is little doubt that well-mentored employees are more loyal, satisfied and professionally committed. What’s more, research by Harvard University’s Frank Dobbin and Tel Aviv University’s Alexandra Kalev shows mentoring programs are much more effective at increasing gender diversity than traditional diversity initiatives like diversity training and performance evaluations.

The business case for engaging men in gender diversity initiatives is clear. In its 2015 report, “Diversity Matters,” worldwide management consulting firm McKinsey & Co. revealed that companies in the top quartile for gender diversity were 15 percent more likely to outperform those in the bottom quartile. But mentoring or sponsoring women takes many industry men outside their comfort zone. Some men still view women’s success as a zero-sum gain. Others work in an environment that doesn’t value gender equality. Here are a few ways men and the companies they work for can level the playing field and support women’s leadership: • Think beyond gender diversity. Hiring more women isn’t enough. Use gender inclusion strategies when identifying high-potential talent and creating succession plans. The result will be more diversity from the top down, which creates a culture of fairness and mutual respect, leading to better morale and bottom-line results. • Resist stereotypes. Smart leaders don’t make assumptions about the career goals of women

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based on their employees’ marital status or how many kids they have or may have in the future. Indulging in gender stereotypes is unfair — and bad for business. • Ensure opportunities for growth. Male champions ensure women have the same development opportunities as men to get the experience they need to advance. • Be a consistent and vocal ally. Men who support women’s leadership development recognize women team members for their achievements in visible and meaningful ways. Engage peers and direct reports in conversations about equality and fairness at work. Acknowledging the crucial role that men can play in creating gender equality is just the first step in creating a better workplace for all. Companies must actively pursue policies that require and reward managers — male and female — who build diverse teams. For Fajgenbaum, having the support of a male boss pushed her career — and compensation — forward. And it forever changed the way she approached her work. “I repeat [to myself], ‘Why not me?’” she says. “It’s helped me to take more risks and accelerated the growth of my business.” CSN Nancy Krawczyk is vice president, corporate partnerships and engagement for the Network of Executive Women, Retail and Consumer Goods, a learning and leadership community representing 10,000 members, 950 companies, more than 100 corporate partners and 20 regional groups in the United States and Canada. Learn more at newonline.org. Editor’s note: The opinions expressed in this column are the author’s and do not necessarily reflect the views of Convenience Store News.

HOTPRODUCTS Special Advertising Section

Snacks

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HOTPRODUCTS Special Advertising Section

General Merchandise

Gourmet Pet Treats

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HOTPRODUCTS Special Advertising Section

Financial Services

Skimming Prevention

Pizza Equipment

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CLASSIFIED Pet Treats

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50% of your customers own a dog. Gross profit margins average 40%. Our retail prices are 30-50% below the big box pet stores. Our product variety and quality offers a selection for any type of dog. Our wooden display case is handmade in our Michigan workshop and brings attention to itself.

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3302 Associates Dr. Burton, MI 48529

CLASSIFIED Credit Card Processing / Merchant Services

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CLASSIFIED C-Store Recruiters

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CLASSIFIED General Merchandise

ATMs

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CLASSIFIED Pre-Paid/Cellular Products

Air Vacs

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CLASSIFIED Plastics

Age Verifier

Petroleum/Equiment

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CLASSIFIED Sunglasses

Age Verifier

FOR ALL YOUR NEW PRODUCTS AND SERVICES ADVERTISE IN

CSN

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TERRY KANGANIS

201.855.7615

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CLASSIFIED Air Vacs

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Services

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CLASSIFIED Financial Services

Financial Services

ATMâ&#x20AC;&#x2122;s

Equipment / Supplies

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Equipment / Supplies

Wholesale Refrigeration

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General Merchandise

FUR TAILS FROM $2-$15 DAVY CROCKETT HATS $5.00 Silver Fox tails are a good seller!

We have: Red Fox tails, Coyote tails, White tails, Racoon tails, etc.

Leopard Rabbit Skin

Rabbit Skins come in White and Ivory for $2.00 and Leopard for $8.00

Strips Inc. Tel.: (718) 786-3381 Fax: (718) 786-0203 http://stripsinc.tripod.com STRIPSINC1@aol.com

ADINDEX Advance Pierre Foods ........................................................................55 Altria Group Distribution Company .................................................2-3 Anchor Packaging ..............................................................................5 Autofry/MTI ........................................................................................12 Bake’nJoy ............................................................................................17,67 Boston Beer/Samuel Adams .............................................................30 Cash Depot..........................................................................................14 Coca Cola ............................................................................................19 Cookies United ...................................................................................45 Crown Imports ....................................................................................13 Delorio Foods Inc................................................................................44 Del Monte Fresh Produce ..................................................................41 Fini Sweets .........................................................................................46 Forte Products .....................................................................................32 Greencore USA ...................................................................................23 Heineken .............................................................................................37 Hershey’s ............................................................................................7 Home Market Foods ...........................................................................47 Hunt Brothers Pizza ...........................................................................83 InLine Plastics.....................................................................................16 J&J Snack Food Corp. ........................................................................29 John Middleton...................................................................................21 Krispy Krunchy Chicken....................................................................33 Liggett Vector Brands ........................................................................59 Living Essentials ................................................................................63 McKee/ Little Debbie .........................................................................31 McLane Co. .........................................................................................15 Nestle Professional.............................................................................65 Perfetti Van Melle...............................................................................43 PFS Bands ...........................................................................................56-57 Phillips .................................................................................................49 Renewable Energy Group.................................................................51 RJ Reynolds Tobacco Company .......................................................9 Sato America.......................................................................................53 Subway................................................................................................84 Tillamook Country Smoker, Inc. .......................................................39 Tyson ...................................................................................................27 Universal Merchant Services ............................................................Outsert White Castle .......................................................................................61 Wm. Wrigley Jr. Company ................................................................35

570 Lake Cook Road, Suite 310, Deerfield IL 60015 Phone (224) 632-8200 Fax (224) 632-8266 www.ensembleiq.com

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 570 Lake Cook Rd. Deerfield, IL 60015. Copyright © 2017 by EnsembleIQ. All rights reserved. Subscriptions: One year, $93; two years, $152. One year, Canada, $110; two years, Canada, $175. One year, foreign, $150. Payable in advance with a bank draft drawn on a U.S. bank in U.S. funds. Single copies, $10, except foreign, where postage will be added. Printed in U.S.A. Periodicals postage paid at Deerfield, IL, and at additional mailing offices. POSTMASTER: Send address changes to Convenience Store News, P.O. Box 1842, Lowell, MA 01853.

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GETTINGTOTHECORE

Message Received Is social media, text or email the best communication vehicle?

convenience store can have all of the products and services a shopper wants and needs, but the cash register won’t ring unless that consumer is aware of the store’s offerings. EnsembleIQ Research, sister company of Convenience Store News, recently surveyed roughly 500 U.S. consumers who shopped at a convenience store in the past month to find out how various means of digital communication — social media, text and email — resonate with them.

A quarter of consumers say they currently “follow” or engage with convenience stores over social media. Men do so at a higher rate than women.

When thinking about the messaging convenience stores use on social media platforms, consumers overwhelmingly point to information about promotions/special offers as the most appealing. Want to grab the attention of social media users? Be funny. Humorous content ranked second, behind info about promotions/special offers, as the most appealing type of messaging.

How likely are you to opt in to receive text messages from a convenience store? Very likely Somewhat likely Neither likely nor unlikely Somewhat unlikely Not at all likely

12.7% 14.9% 23.3% 26.3% 22.7%

Base: 502 consumers who purchase food or beverages from a c-store at least once a month Source: Convenience Store News Market Research, 2017

Getting consumers to opt in for text messages may prove challenging, as nearly half of those surveyed say they are unlikely to do so.

How likely are you to opt in to receive email messages from a convenience store? Very likely Want to collaborate and share expertise with your peers? The Council of Retail Experts (CORE) is an exclusive network of convenience store retail leaders who do just that. For more information on how to join CORE, please visit www.cvcoreinsights.com.

Somewhat likely Neither likely nor unlikely Somewhat unlikely Not at all likely

Survey respondents sourced via ProdegeMR, a leading provider of data collection solutions for the research industry. Visit www.prodegemr.com for more info.

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15.7% 22.9% 18.9% 26.3% 16.1%

Base: 502 consumers who purchase food or beverages from a c-store at least once a month Source: Convenience Store News Market Research, 2017

Consumers are a bit more receptive to opting in for email messages. Closer to 40 percent say they are unlikely to do so.

93% OF AMERICANS EAT PIZZA EVERY MONTH *

Your customers have spoken, and they’re asking for pizza. We can help—Hunt Brothers® Pizza is America’s #1 c-store pizza brand because of industry-leading customer service, an easy to prepare menu and delicious tasting product that delivers high proﬁt margins. You only need 59 sq. ft. of space and most store owners pay off their initial investment in less than nine months. LEARN MORE

Download our Pizza Success Guide HuntBrothersPizza.com/CSN

* Source: Pizza.com

We’re made to serve.

Give them a tasty reason to hit the brakes.

A Subway® sandwich shop is a great fit

for your location. You can become a Subway franchisee or lease space to an experienced Subway franchisee. Contact Allison Morrow 1.800.888.4848x1736 or 1.203.877.4281x1736 Morrow_A@subway.com or visit subway.com SUBWAY® is a Registered Trademark of Subway IP Inc. © 2017 Subway IP Inc.