Competitive Watch
to introduce a new smaller store format that will offer high-quality foods at value prices. Geared toward millennial shoppers, the new stores will feature a modern streamlined design, innovative technology and a curated selection of products. The first of these new stores is slated to open in 2016, and Whole Foods expects the standardized design and product assortment should allow for fairly rapid expansion. The new format is meant to be a complementary brand — not an alternative — to current Whole Foods Market stores. The retailer anticipates shoppers will visit both stores: the traditional, larger Whole Foods Market stores for their typical weekly grocery shopping trip, and the new store format for fill-in shopping trips. Big-box stores are definitely discovering value in small formats for moving merchandise fast and leveraging their brand recognition, according to Ricardo Belmar, director of product management and marketing for Hughes Network Systems, which provides managed network services for retailers and other businesses. The threat is that “big-box brands have a higher level of brand awareness and affinity than smaller convenience store chains,” Belmar reasoned. Walmart has several smaller formats in operation today and is in the process of expanding its reach,
including Walmart Neighborhood Market (613 locations as of March 31), Walmart on Campus (five locations as of late April) and Walmart to Go (one location in Bentonville). Target Corp., too, is rapidly growing
extreme Convenience When putting down roots, the millennial generation is gravitating toward “mixeduse residential and commercial properties,” and this could be good news for convenience store retailers. The mixeduse format is said to fit well with c-store operators looking to become even more convenient, incorporating walkability and urban living into new store locations. “While millennials are strong mobile and online shoppers, they favor shopping experiences that integrate traditional retail tenants with restaurants and leisure amenities,” said Judd Bobilin, president and CEO of Chance Partners, a developer of mixed-use properties. “Retailers and developers are beginning to see sales-per-square-foot revenue for
mixed-use or urban storefront footprints can be anywhere from 50 [percent] to 100 percent higher than typical suburban locations.”
While previous generations may have considered convenient locations to be within a five-mile radius of their home or along their daily driving route, the millennial definition of convenience is “right downstairs” or “within walking/bik-
66 Convenience Store News | JUNE 2015 | WWW.CSNEWS.COM
ing distance,” Bobilin added. The term “extreme convenience” has sprung up as a result of these trends, signaling the need for convenience stores to cater better to this generation accustomed to instant gratification and on-demand everything. Apparently, one of the most common questions residents of urban or mixed-use developments pose is, “Where can I buy groceries?” The footprint constraints of mixed-use retail space may create a challenge for traditional food retailers and other big boxes, but not so much for c-stores. Thus, this presents another opportunity for savvy c-stores to fight back with what they know best — delivering convenient items in a small space.