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THE RICHARDS GROUP JOB #: MTL20 048963 Franchise Print Cover Tip/Front TRIM: 7.875 x 8.875 LIVE: .25 inside trim COLORS: CMYK PUBLICATION: Convenience Store News FOR QUESTIONS CALL: Karen Newman 214-891-5875

CLIENT: Motel 6 BLEED: .125 outside trim INSERTION: September 2020

W H AT ’ S N E X T I N C O N V E N I E N C E A N D F U E L R E TA I L I N G

Reimagined. Reinvented. The All-New 6. G6 Hospitality is the parent company to Motel 6 and Studio 6, two of the most iconic lodging brands in the United States. G6 owns and operates nearly 1,400 locations across the United States and Canada, with over 155 new properties now in the pipeline, 50% of them new construction. Since G6 is one of the most reliable and financially rewarding franchise opportunities in economy lodging, becoming a franchisee in the G6 family is the smartest investment you can make.

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©2020 All rights reserved. G6 Hospitality Franchising LLC. 4001 International Parkway, Carrollton, Texas 75007. This advertisement is not an offer to sell a franchise. An offer can be made only by means of a Franchise Disclosure Document that has been registered and approved by the appropriate agency in your state, if your state requires such registration. Minnesota Registration Nos. – Motel 6: F-5053; Studio 6: F-5052. *Source: Item 19 of the March 4, 2020, Motel 6 FDD. **Source: Item 19 of the March 4, 2020, Studio 6 FDD.


W H AT ’ S N E X T I N C O N V E N I E N C E A N D F U E L R E TA I L I N G

BEST NEW PRODUCTS OF THE YEAR

HITTING THE TURBO BUTTON ON INNOVATION

The convenience channel is rapidly expanding the ways it serves customers amid these unprecedented times.

SEPTEMBER 2020 CSNEWS.COM


Local, State and Federal tobacco taxes and restrictions on the sale of tobacco products can hurt your business. Governments often pass new laws quickly, so you need to stay informed about what is happening in your area. You and your business matter and making your voice heard is crucial to our success in fighting for fair tobacco policies.

Take this survey to learn more about how you can get involved

TAKE SURVEY CLICK HERE

TobaccoIssues.com is operated on behalf of Philip Morris USA, U.S. Smokeless Tobacco Co., John Middleton, and Nat Sherman. Š2020 Altria Group Distribution Company | For Trade Purposes Only


VIEWPOINT

Necessity Fuels Accelerated Innovation The pandemic inspires change throughout the industry I KNOW THE SAYING IS, “Necessity is the mother of invention,” but in these COVID-19 times, it appears that necessity (the new normal caused by worried pandemic customers) has spurred the faster implementation of innovations already being explored by convenience store retailers.

The pandemic has spawned some truly creative — and weird — innovations, such as the New York City newspaper reporter who wore a 50-inch-wide hot pink hoop skirt to socially distance on the city’s notoriously crowded subway. Coronavirus-inspired innovations in the convenience store industry are equally creative, if not as outlandish as dressing like Scarlett O’Hara on the No. 6 train to keep fellow straphangers at a distance. The COVID-19 pandemic has accelerated many technology initiatives at the nation’s leading convenience retailers. Our 2020 Technology Study (see page 104) shows that investment has shifted from compliance-driven mandates to new ways to attract customers and serve them effectively with as little human contact as possible. Our cover story (see page 40) spotlights five c-store retailers that have invested in innovation, even during a time when revenue growth is being challenged throughout the retail community. Besides innovative approaches to serving their customers in a contactless way, these five retailers — Alltown Fresh, Kwik Chek, Kum & Go, MAPCO

and StrasGlobal — have something else in common. They prove that true innovation doesn’t have to come only from the giant national retailers. It’s good to see innovation sprouting all over the industry. Foodservice sales have been hit particularly hard by COVID-19 restrictions. Yet, the nation’s best convenience foodservice retailers continue to raise the bar on quality and innovation, from the introduction of craveable menu items to expanded private-label products, new bean-to-cup and softheat urn coffee systems, and a game-changing cold/frozen drink machine. Check out our report on the 2020 Convenience Store News Foodservice Innovators Awards winners (page 82). Innovation among suppliers has also been apparent throughout this pandemic. The novel coronavirus inspired a number of the innovations in packaging, healthfulness and flavor pairings that are being honored in our 24th annual Best New Products Awards (see page 56). And, finally, as the media brand that keeps the industry “Ahead of What’s Next” (as our tagline promises), CSNews has launched several new digital, interactive conference, award event and new product showcase platforms to help provide retailers with education, networking and sourcing of new items during these times when face-to-face meetings are in limbo. For comments, please contact Don Longo, Editorial Director, at (201) 855-7606 or dlongo@ensembleiq.com.

EDITORIAL EXCELLENCE AWARDS (2013-2020)

EDITORIAL ADVISORY BOARD Brett Atherton Bolla Management

2018 Jesse H. Neal National Business Journalism Award Finalist, Best Editorial Use of Data, June 2017

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

2018 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Website Business to Business, Retail, Full Issue, October 2017 Business to Business, Editorial Use of Data, June 2017 2017 Eddie Awards, Folio: magazine Winner, Business to Business, Retail, Single/Series of Articles, May 2017 Honorable Mention, Business to Business, Retail, Single/Series of Articles, June 2016 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

2016 American Society of Business Press Editors, National Azbee Awards Gold, Best How-To Article, March 2015 Bronze, Best Original Research, June 2015

2014 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2013 Business to Business, Retail, Single Article, February 2013

2016 American Society of Business Press Editors, Midwest Regional Azbee Awards Gold, Best How-To Article, March 2015 Silver, Best Original Research, June 2015

2013 Eddie Award Honorable Mention, Folio: magazine Business to Business, Retail, Full Issue, October 2012

2013 American Society of Business Press Editors, Midwest Regional Azbee Awards Bronze, Best Editorial/Commentary, July 2012

4 Convenience Store News C S N E W S . c o m

Rick Crawford Green Valley Grocery Edward Davidson ER Davidson & Associates (7-Eleven Inc., retired) Jim Hachtel Eby-Brown Co. Chris Hartman Rutter’s Ray Johnson Speedee Mart

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

Laura Aufleger OnCue Express

Jack Lewis GPM Midwest

2020 Trade Association Business Publications Intl. Tabbie Awards Honorable Mention, Best Single Issue, September 2019 2016 Trade Association Business Publications Intl. Tabbie Awards Silver, Front Cover Illustration, June 2015

Joe Lewis ExtraMile Convenience Stores Ruth Ann Lilly GPM Investments Danielle Mattiussi Maverik Inc. Vito Maurici McLane Co. Inc. Jonathan Polonsky Plaid Pantries Inc. Greg Scriver Kwik Trip Inc. Bill Stein Core-Mark Roy Strasburger StrasGlobal


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CONTENTS SEPT 20

VOLUME 56 N UMB ER 9

56

116

40 FEATURES

DEPARTMENTS

COVER STORY

VIEWPOINT

NEW HORIZONS

4 Necessity Fuels Accelerated Innovation The pandemic inspires change throughout the industry.

114 Supporting Women of Color NEW offers resources for communities of color in an unprecedented time.

10 CSNews Online

STORE SPOTLIGHT

30 New Products

116 A Culinary Experience CEFCO Kitchen creates a new brand committed to fresh and delicious food offerings.

40 Hitting the Turbo Button on Innovation The convenience channel is rapidly expanding the ways it serves customers amid these unprecedented times. FEATURE

56 Innnovation Abounds COVID-influenced packaging, health and flavor pairings highlight our 24th annual Best New Products Awards competition.

30 6 Convenience Store News C S N E W S . c o m

SMALL OPERATOR

34 The Small Operator’s Secret Weapon Retailers need to truly understand what makes their market area tick.

INSIDE THE CONSUMER MIND

138 Competitive Eats C-store prepared food buyers say they can find better quality elsewhere.

138 40 34


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CONTENTS SEPT 20

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98

8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631 (773) 992-4450 Fax: (773) 992-4455 www.csnews.com

BRAND MANAGEMENT Vice President/Group Brand Director Paula Lashinsky (917) 446-4117 plashinsky@ensembleiq.com EDITORIAL Editorial Director (201) 855-7606

Don Longo dlongo@ensembleiq.com

Editor-in-Chief (201) 855-7608

Linda Lisanti llisanti@ensembleiq.com

Senior News Editor (201) 855-7618

INDUSTRY ROUNDUP

CATEGORY MANAGEMENT

14 Pilot Co. to Start 2021 With New Leadership

FOODSERVICE

18 NACS Show 2020 to Go Virtual 18 Fast Facts 24 Retailer Tidbits

82 Raising the Bar on Convenience Foodservice Alimentation Couche-Tard leads this year’s lineup of Foodservice Innovators Awards winners. FOODSERVICE

89 Revising the Roadmap More than half of c-store retailers saw foodservice sales decrease in the first half of 2020.

24 Eye on Growth 28 Supplier Tidbits 28 In Memoriam

Melissa Kress mkress@ensembleiq.com

Associate Editor (201) 855-7619

Angela Hanson ahanson@ensembleiq.com

Associate Managing Editor (201) 855-7604

Danielle Romano dromano@ensembleiq.com

Contributing Editor (303) 741-3377

Renée M. Covino reneek@aol.com

Contributing Editor (201) 280-2614

Tammy Mastroberte tmastroberte@gmail.com

ADVERTISING SALES & BUSINESS Associate Brand Director & Northeast Sales Manager (508) 385-2524

Rachel McGaffigan rmcgaffigan@ensembleiq.com

Associate Brand Director & Western Sales Manager (330) 840-9557

Ron Lowy rlowy@ensembleiq.com

Associate Publisher & Midwest Sales Manager Kelly Fischer (773) 992-4464 kfischer@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 EVENTS

82

FOODSERVICE

93 Innovation Is Still Key to LTO Success Despite pandemic, excitement for the latest food and beverage trends has not slowed.

Executive Vice President, Events & Conferences Ed Several (860) 830-8321 eseveral@ensembleiq.com AUDIENCE List Rental (914) 309-3378

MeritDirect Marie Briganti

Subscriber Services/Customer Care TOLL-FREE: (877) 687-7321 FAX: (888) 520-3608

contact@csnews.com

PROJECT MANAGEMENT/PRODUCTION/ART

TOBACCO

94 Due Date After delays and court challenges, the clock strikes midnight on the deadline for premarket tobacco product applications.

Vice President, Production (877) 687-7321 Creative Director (973) 607-1320

Derek Estey destey@ensembleiq.com Colette Magliaro cmagliaro@ensembleiq.com

Advertising/Production Manager (773) 992-4418

Ed Ward eward@ensembleiq.com

Art Director (973) 607-1321

Lauren DiMeo ldimeo@ensembleiq.com

TOBACCO

TECHNOLOGY 104 Meeting New Customer Needs Through Technology Tech spending continues to rise as pandemic speeds implementation of contactless technology, home delivery and curbside pickup.

98 Health & Wellness on the Backbar Wawa makes the decision to enter the smoking cessation category.

CORPORATE OFFICERS Chief Executive Officer Jennifer Litterick Chief Financial Officer Jane Volland Chief Innovation Officer Tanner Van Dusen Chief Human Resources Officer Ann Jadown Executive Vice President, Events & Conferences Ed Several Senior Vice President, Content Joe Territo

GROCERY

100 Grocery’s Star Power The change in shopping habits amid COVID-19 is illuminating a c-store opportunity.

CONVENIENCE STORE NEWS AFFILIATIONS Premier Trade Press Exhibitor

The contents of this publication may not be reproduced in whole or in part without the consent of the publisher. The publisher is not responsible for product claims and representations.

Convenience Store News (ISSN 0194-8733; USPS 515-950) is published 12 times per year, monthly, by EnsembleIQ, 8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631. Subscription rates: Subscription rate in the United States: $125 one year; $230 two year; $14 single issue copy; Canada and Mexico: $150 one year; $270 two year; $16 single issue copy; Foreign: $170 one year; $325 two year; $16 single issue copy. Periodical postage paid at Chicago, IL 60631, and additional mailing addresses. Copyright 2020 by EnsembleIQ. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or information storage and retrieval system, without permission in writing from the publisher. Reprints, permissions and licensing, please contact Wright’s Media at ensembleiq@wrightsmedia.com or (877) 652-5295. POSTMASTER: send address changes to Convenience Store News, 8550 W. Bryn Mawr Ave. Ste. 200, Chicago, IL 60631.

8 Convenience Store News C S N E W S . c o m


Why 5-hour ENERGY ? ®

The original energy shot; led the creation of a billion-dollar category(i) Often imitated, never duplicated #1 energy shot for the last 10 years(ii) $868+ million dollars in retail sales(iii) Top 10 selling items and 19 of the top 20 items in convenience channel(iv) Highest $ sales per linear inch amongst national brands at the front end(v) Berry Extra Strength 5-hour ENERGY is the #1 energy shot item in convenience delivering $98 million in retail sales(iv)

On-trend flavor innovation Tropical Burst Extra Strength 5-hour ENERGY ranks #12 in sales Coming in early 2021: Watermelon Extra Strength 5-hour ENERGY

Individual results may vary. See www.5-hourEnergy.com for more details. Regular Strength 5-hour ENERGY® and 5-hourTM TEA shots contain caffeine comparable to a cup of the leading premium coffee. Extra Strength 5-hour ENERGY® shots contain caffeine comparable to 12 ounces of the leading premium coffee. Limit caffeine products to avoid nervousness, sleeplessness, and occasional rapid heartbeat. Individual results may vary. See www.5hourenergy.com for more details. ©2020 Living Essentials Marketing, LLC. All rights reserved. Sources: (i)Mintel. (ii)IRI & Nielsen. (iii) US-XAOC INCL CON 52 WE 12/28/19. (iv)US-CON 52 WE 07/11/20 - Sales by Item. (v)Convenience IRI retail audit, Nielsen 52 weeks ending 5/18/19 and NACS margin report.


CSNEWS ONLINE

ONLINE EXCLUSIVE

TOP VIEWED STORIES

1

Convenience Stores Ask for Exact Change as Coin Shortage Continues

2

Kwik Trip to Acquire Stop-N-Go Convenience Centers

Convenience retailers are urging customers to bring their coin purse when they shop, as stores across the country deal with a short supply of change. Thorntons LLC is one such chain asking customers to use exact change. Customers who pay with change, or exchange at least $10 in coins, can receive a free fountain drink, coffee, cappuccino or FizzFreez.

Kwik Trip plans to continue operating many of the 36 acquired stores in southern Wisconsin and northern Illinois under the existing Stop-N-Go banner. Some of the larger locations will be remodeled and rebranded as Kwik Trip stores. The transaction is expected to close in early December.

3

7-Eleven Inc. Hits New Milestone

7-Eleven Inc. hit the milestone of 71,100 convenience stores globally with the recent opening of a new location in Seoul, South Korea. Master franchisees will open stores in India and Cambodia soon.

4

Poll: COVID-19 Pandemic Forces C-store Retailers to Significantly Scale Back Employee Travel

Nearly nine out of 10 c-store retailers instituted travel restrictions on their employees due to the pandemic, with most of the restrictions starting in February/March 2020, according to a new poll conducted by Convenience Store News.

5

Cumberland Farms Unveils New ‘Store Within a Store’ Concept

Cumberland Farms opened its first Farmhouse Fresh To Go store in its hometown of Westborough, Mass., on Aug. 10. The new concept is a “store within a store” inspired by the traditional European bakery-café.

WEBINAR

How Small Operators Can Be Successful in a Post-COVID-19 World What are the critical challenges facing the convenience store industry’s small operators? How does the financial performance of small operators (1-20 stores) compare with that of the industry’s larger chains? What does it take to be a successful small operator in the convenience channel today? Answers to these questions and more were explored during a recent Convenience Store News webinar that highlighted the results of CSNews’ inaugural State of the Small Operator Study, which examined the financial performance of convenience channel retailers that operate one to 20 stores vs. the overall industry. To view this and other recent webinars, go to csnews.com/ webinars. 10 Convenience Store News C S N E W S . c o m

Convenience Store News Industry Report 2020 Deep Dive: Candy & Snacks Candy and snacks fulfill various need states for consumers — from satisfying a craving, to treating or rewarding themselves, to supporting their emotional wellbeing, to taking part in important holidays and celebrations. In this special “Candy & Snacks Deep Dive” report, a bonus supplement to the Convenience Store News 2020 Industry Report, we present exclusive data and analysis of the candy, salty snacks and alternative snacks categories. For more exclusive stories, visit the Special Features section of csnews.com.

MOST VIEWED NEW PRODUCT

NRSPlus POS Network The NRSPlus point-of-sale (POS) network from National Retail Solutions provides everything a convenience store needs for a quick and seamless checkout experience, according to the company. The system delivers a combination of dependable hardware and sophisticated software. The POS bundle includes a built-in customer loyalty program, one-touch Boss Revolution pinless recharge, remote management app, and web portal. Optional premium features are tobacco scan data, license ID scanning, transaction surveillance monitoring, item modifiers with a secondary printer, and a POS-linked shopping app to order ahead. The system integrates with NRS PAY and other card processing options. National Retail Solutions Newark, N.J. (833) 289-2767 nrsplus.com


Advertisement

SWISHER’S BOLD NEW FUTURE EMPOWERS CONVENIENCE RETAILERS With more than 200 million adult consumers in the U.S., there is no doubt that this segment is the largest and most important for today’s convenience John J. Miller retailer. It should President be no surprise that business growth is intrinsically tied to how a company pivots and evolves along with (and ahead of) the changing preferences of those adult consumers. While Swisher has always been centered on relationships with valued trade partners, particularly in the C-store space, today Swisher is more focused than ever on being the source those partners turn to for the insights and products that create direct connections with adult consumers. Innovative products are one important way to build the future, but they have to be matched with adult consumer insights, superior customer relationships and action to truly achieve the goal of becoming a leading adult consumer lifestyle brand.

SUCCESS SIMPLIFIED: A SERVICE MODEL BUILT AROUND YOU An important component of Swisher’s evolution is – Success Simplified – a platform that makes success easier and more profitable for trade partners. The platform is based on the tenets of

innovation, insights, action, reliability and shared success. These are delivered through a one-stop-shop offering of products, creative packaging, advanced manufacturing technologies, product guarantees and shared performance programs. This is just one example of how Swisher makes doing business easier. Ultimately, the Success Simplified approach is a win for Swisher’s valued partners.

INNOVATION

leader. Expertise, product knowledge and growth opportunities are delivered in one relationship through the recent alignment of the company’s offerings

“ The business partnerships that trade customers have formed with Swisher’s knowledgeable sales team will only be amplified further by this expanded effort.”

INSIGHTS ACTION RELIABILITY SHARED SUCCESS

BRANDS YOU TRUST, BACKED BY CATEGORY FOCUS & EXPERTISE Since 1861, Swisher has always been driven by an entrepreneurial spirit and a passion to create. Throughout the decades, strategic acquisitions, technology improvements and product innovations have enabled Swisher to maintain its position as an industry

into five focused strategic businesses: Swisher Sweets Cigar Company (Cigars & Cigarillos); Fat Lip Brands (Smokeless); Drew Estate (Premium Cigars); Hempire (Hemp Products); and Rogue (Modern Oral Nicotine). In each category, trade partners have access to the strategies, product innovations and relationships that drive success.

THE WAYS SWISHER WORKS WITH YOU ARE UNCHANGED The business relationships that trade partners have formed with Swisher’s knowledgeable sales team will only be amplified further by this expanded effort. The evolution will enhance the category expertise, product knowledge and data-driven strategies that benefit customers. A renewed purpose celebrating human connection, fostering creative expression and strengthening community, along with the unwavering commitment to evolve with the tastes of adult consumers, will guide even deeper connections with partners and their customers. Swisher continues to evolve in order to keep you ahead. Learn more at Swisher.com/SuccessSimplified.


THEY NEVER STOP EVOLVING.

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NEITHER DO WE.

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SWISHER SWEETS CIGAR COMPANY | FAT LIP BRANDS | DREW ESTATE | HEMPIRE | ROGUE


INDUSTRY ROUNDUP

Pilot Co. to Start 2021 With New Leadership Jimmy Haslam will become chairman of the board, as Shameek Konar takes the CEO role Jimmy Haslam will step down from the company’s top role in the new year, handing the CEO reins to Shameek Konar, who currently serves as the company’s chief strategy officer.

PILOT CO. CEO

Haslam will become chairman of the board, while James (Jim) Haslam, who founded the family-operated company, will become chairman emeritus. The changes are effective Jan. 1, 2021. “Since day one with Pilot in 2017, Shameek has shown his dedication to advancing our company and the industry,” Jimmy Haslam said. “Shameek has successfully launched and grown our Pilot Energy business and become a key member of our leadership team. His knowledge of the energy sector, including expertise in the acquisition, development and operations of infrastructure assets and resources, and his deep appreciation of Pilot’s culture and values are a few of the reasons why we chose him to be our next CEO. We have full confidence that Shameek will continue to grow the legacy of our family’s business.”

14 Convenience Store News C S N E W S . c o m

To begin transitioning into the chief executive role, Konar is taking on additional responsibilities effective immediately, including the management of technology, human resources, finance and legal. The real estate team will continue to report to Jimmy Haslam and the store operations and development teams will continue to report to Pilot Co. President Ken Parent. Store operations and development will be added to Konar’s role in 2021. Come January, Parent will become senior advisor to the CEO and the chairman, providing guidance on strategy and key priorities for the company. During his time with the company, Parent has helped the retailer achieve significant growth through the development of successful systems and processes, as well as building an outstanding leadership team. The rest of Knoxville, Tenn.-based Pilot’s management team will stay in place. As a family-operated company for 62 years, the Haslam family will continue to be involved in the running of Pilot Co. Whitney Haslam Johnson will continue to serve as chief experience officer and a member of the board, and Bill Haslam will serve on the board.


“WHEN YOUR DRIVERS ARE NO-SHOWS, I GRAB MY KEYS.” RANDALL RHODES MARKET LEAD DRIVER

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INDUSTRY ROUNDUP

NACS Show 2020 to Go Virtual The live industry event is the latest victim of the COVID-19 pandemic THE 2020 NACS SHOW will

transition to a virtual event as the novel coronavirus health crisis has forced NACS to cancel the largest annual gathering of the convenience store industry. “As part of daily communications with the Las Vegas Convention and Visitors Authority (LVCVA), NACS was informed that the 2020 NACS Show, scheduled for Oct. 11-14, cannot be held due to the ongoing pandemic,” the Alexandria, Va.-based association said on July 30. Speaking with “a heavy heart,” NACS President and CEO Henry Armour said the association had worked closely with the health department, the LVCVA, its official partners, vendors and other stakeholders to develop a worldclass “city within a city” that prioritized safety for attendees and staff. “At the same time, there are issues beyond our control that led to this decision,” Armour explained. The virtual experience will take the three most important elements of the in-person event — education, access to new products, and retailer/supplier connections — and incorporate them into innovative tools for users to meaningfully engage and improve their businesses. NACS invested in new platforms with plans to roll them out in 2021. It has now fast-tracked implementation to keep the industry connected until in-person events resume.

“The NACS Show is where we come together to share ideas, make each other better, and plan for the coming year. We know that we can’t simply transfer the live, in-person experience of the NACS Show to a virtual offer. Instead, we are replicating the elements that can deliver the most value in a digital environment,” Armour said. The virtual experience, to be available this fall, will include on-demand education with real-time interactions, a virtual product showcase, and direct appointment settings.

FAST FACTS

The week ending June 13 represented the fourth consecutive week during which hard seltzer drove more than $100 million in retail off-premise dollar sales.

Nearly four in 10 consumers say having snacks and treats on hand is part of their pantry strategy. — National Eating Trends, The NPD Group

— Nielsen

18 Convenience Store News C S N E W S . c o m

Among retailers that implemented contactless payments, 94 percent expect the increase in usage to continue over the next 18 months. — National Retail Federation & Forrester Study

Ninety percent of millennial moms and young parents can’t imagine Halloween without chocolate and candy. — Harris Poll, on behalf of National Confectioners Association


SPECIAL SERIES ON MOBILE ORDERING

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Subscription Services Move Offline C-stores and QSRs are using this profitable medium to drive traffic to physical locations By Debby Garbato IN THE 1970S AND 1980S,

myriad teens responded to Columbia House ads offering 13 records or tapes for $1. The catch? They had to buy several items at inflated prices (plus shipping costs) in the ensuing years. Customers were also sent (and billed for) monthly selections — unless they mailed back a refusal card by a certain date. Despite lots of fine print and a dubious reputation, the tactic worked, with Columbia’s 1996 sales peaking at $1.4 billion.

By 2015, digital music’s growth bankrupted Columbia. It probably would have died anyway, with the 2000s giving rise to Internet-based subscription companies like Amazon Prime, Dollar Shave Club, Stitch Fix and Blue Apron. These entities provided straightforward membership information with no purchasing commitments and easy opt-outs. They raised the bar, revolutionizing attitudes toward subscription services. According to Deloitte Consulting, 37 percent of shoppers have used a subscription service over the past 12 months, while 49 percent plan to join one over the next year. “Subscription models are now a part of the average customer’s behavioral DNA thanks to pioneers like Netflix, Stitch Fix and meal kits,” said Eduardo Luz, chief brand and concept officer for fast-casual restaurant chain Panera Bread. “They’re ahead of the curve and create an easy consumption process. Customers understand the value.”

Amazon Prime has become an industry benchmark, with about 112 million U.S. subscribers as of December 2019, per Statista.com. Members spend roughly $1,300 annually, more than twice as much as non-Prime shoppers, according to Tinuiti’s 2019 Amazon Consumer Shopping Study. But not all modern subscription services are Internet-based. Over the past year, Panera along with convenience stores and other restaurants have entered this lucrative space. Unlike Internet-based companies, they target on-the-go shoppers via proprietary mobile apps. The emphasis is on physical store locations and frequently purchased, replenishable categories like fuel, coffee and popular foods. These subscription categories drive traffic and add-on sales. Like online-only models, though, subscriptions involve repeat purchasing and customized, artificial intelligence (AI) driven shopper offers. Data generated by subscriptions is more consistent than that generated by loyalty programs. Monthly payments are automatically and conveniently processed via apps. Foodservice is a desired subscription segment, with 45 percent of consumers wanting a beverage subscription and 41 percent wanting a food one, according to a Wiser poll that asked: “Are Subscription Services the Future of QSRs?” Demographically, 53 percent of subscribers are aged 25 to 34, making subscriptions a good fit for c-stores and restaurants, according to AlixPartners’ Consumer Subscriptions Survey released by the consulting firm in February 2019. Consumers’ trust and understanding of Internetbased subscriptions has transferred to brickand-mortar models. “The biggest barrier to introducing a new model or product is whether it forces a customer to change behavior,” said Luz. “Introducing [the subscription] model into our customer orbit is a natural extension of [guests’] preexisting behavior.”

Panera’s coffee subscription service has nearly 850,000 members.

Launched eight months ago, Panera’s coffee subscription service boasts almost 850,000 members. Guest frequency has grown more than 200 percent. Food add-ons increased 70 S E P T E MB E R

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“Technology was a big piece,” said Minford. “Compared to 10 years ago, it made things easier. We worked with our loyalty provider to add subscriptions. Now, everything can be loaded onto somebody’s account and we receive valuable data.” Many subscriptions require joining app-based loyalty programs. While both involve points, perks and crosscategory offers, there is a key difference: subscribers become regular customers, yielding consistent, more actionable data. Loyalty members, on the other hand, may not be regular shoppers. The Bond Report found consumers belong to an average of 14.8 loyalty programs, but are active in only 6.7, on average.

HuHot Mongolian Grill’s “Grill Pass” subscription boosted customer spending by 80 percent.

percent, Luz cited. Ninety-plus percent of members renew monthly. Internet-based subscriptions have also made consumers “comfortable and familiar” with monthly fees being automatically paid via their credit card or other means, said Monica Minford, senior director, digital, for Missoula, Mont.-based HuHot Mongolian Grill. “Why shouldn’t that trust translate to our business? We don’t do shipping or fulfillment. But our Grill Pass gives people a reason to visit monthly. The goal of having repeat customers is the same.” HuHot’s Grill Pass subscription, which was offered for two consecutive years and redeemable within a six-month period for HuHot’s signature create-your-own stirfry entrees, increased customer spending by 80 percent and store visits by 30 percent. Grill Pass purchasers spent 44 percent more than before, adding beverages, desserts and appetizers. “Customers weren’t as frugal because entrees were already paid for,” said Minford. Packages offered were: five Grill Meals for $50, 11 meals for $100, and 25 meals for $200. Other restaurant and c-store chains offering subscriptions include Cumberland Farms (coffee), RaceTrac Petroleum (fuel), Olive Garden (pasta), Circle K (car wash) and Smashburger (burgers).

It’s All in the App These restaurant and c-store subscription formats would not be possible without proprietary mobile apps. Initially launched to digitize and facilitate loyalty engagement, apps’ interactive, complementary functions now include payment options, ordering, delivery (or curbside pickup) and subscriptions.

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“Almost half are absent,” said Amanda Lai, senior consultant at McMilland Doolittle LLC. “Subscription customers have more regular shopping behaviors.” Trevor Boomstra, a director in the restaurant, hospitality and leisure division at AlixPartners, believes that subscription data helps purveyors better understand guests’ behavior “along the lifecycle, from acquisition to special promotions.” These additional insights, he noted, “help better shape micro-marketing campaigns.” Panera has benefitted from the activities of both loyalty and subscription customers. For starters, more than half of transactions come from its 40 million-plus MyPanera loyalty members, cited Luz. A MyPanera member’s lifetime value is about five times that of a non-member. The value is even higher among coffee subscribers, who must join MyPanera.

Valuing Existing Customers Restaurant and c-store subscriptions mainly attract existing customers, with subscriptions serving as add-ons to comprehensive app programs, explains Bobby Stephens, principal, retail/consumer products, at Deloitte Consulting. “Subscriptions amplify experiences. They’re not standalones and would have difficulty scaling. If there’s an owned app with an active user base, broad offerings supporting multiple dayparts and mobile ordering/delivery, subscriptions can benefit,” he said. “Throw a loyalty program on top and it’s a recipe for success.” Companies may sacrifice some profits, but targeting loyal consumers is more cost effective than attracting new ones. “Once a customer has subscribed, they’re allocating a percentage of their budget to that brand,” said Michelle Tempesta, head of marketing at Paytronix, a provider of customer engagement solutions and loyalty programs. “Their purchase becomes an automatic recurrence, which is gold. Consider the contrary, where the brand fights for and purchases consumers’ attention through advertising and discounts.” COVID-19 has made customer retention crucial as many shoppers are working at home now and visiting different stores. Sometimes, desired items are out of stock. During July, a Magid study titled COVID-19 and the Impact on the F&B Industry found that 19 percent of consumers were


still shopping a different store compared to 30 percent in March and April. “Behavior has been turned upside down,” said Corey Chafin, principal at Kearney, a global management consulting firm. “It’s a blank slate. People are transitioning and may not practice old habits. Everyone is trying to maintain customers and acquire new ones. Consumers don’t think about shopping by channel. They want coffee and think about what’s convenient. Subscriptions can make a company top of mind as shoppers set new behaviors.” Subscriptions also can complement other app functions, such as geolocation and curbside pickup, helping retain customers while proving safety and convenience, said Steve Flynn, senior vice president of consumer/commercial brands at Magid, a consumer-centered business strategy company. “Retailers have to get into high gear about how to stay engaged in a non-traditional sense,” he said. When COVID-19 hit in March, Panera took this advice, eliminating its $8.99 monthly subscription fee along with product size and variety limitations (its subscription includes iced or hot coffee and tea). The chain promoted app-based omnichannel services, including Rapid Pick-Up, drive-thru and delivery, since 75 percent of coffee redemption occurs off-premise. Within three weeks, Panera added 700,000 subscribers.

Recipes for Success Successful subscription programs involve more than comprehensive apps and cross-category promotions. Having an established store brand is key. According to AlixPartners, 89 percent of consumers are more willing to start a subscription with an established brand than an Internet startup, while 48 percent cite convenience as a major draw. Subscriptions must revolve around a product/category the company is known for. “Brand is critical; so is the item,” said Flynn. “They’re not all equal with subscriptions.” Case in point: In March, Burger King unveiled a $5 monthly coffee subscription. It was a good value, but lacked the Whopper’s cache and was discontinued. “Coffee isn’t what comes to mind with Burger King,” said Lai. “It’s burgers.” Companies must weigh a product’s value proposition, margin structure, destination purchasing status, buying frequency, and ability to generate add-on sales. Data scientists can then identify promotions that maximize goals. “What are the objectives, the analytics behind them? How does it affect overall business?” posed AlixPartners’ Boomstra. “Art and science must come together to decide what you can offer that consumers value.” Technology-wise, subscriptions are an additional function for increasingly comprehensive retail apps. But how subscriptions stack up against other functions and what their long-term marketing position will be remains to be seen. “It’s an emerging trend,” said Boomstra. “Subscription services are developing and people are figuring out how to use them.” CSN

Pioneers of the New Subscription Model Cumberland Farms’ Coffee Cup-Scription launched in July 2019 in conjunction with its new app. For $25 monthly, customers can receive two cups of coffee daily, bringing the price to 40 cents per cup. They can choose hot or iced coffee, as well as hot chocolate or tea. Introduced in June, RaceTrac Petroleum’s Rewards VIP costs $2.49 monthly. Members save 10 cents per gallon on their first 40 gallons of fuel and 3 cents per gallon afterwards on each fuel purchase. They also receive coupons and promotions for instore products. Circle K recently launched a car wash subscription at four Illinois locations. Wash packages start at $19 monthly and feature member discounts. Users are given redeemable codes. However, it appears Circle K must work out some kinks as Google Reviews is flooded with complaints about malfunctioning codes. Panera Bread’s eight-month-old coffee subscription program has nearly 850,000 members. By eliminating the subscription fee, Panera significantly increased membership as well as shopping frequency, store traffic and add-on sales. Smashburger has offered its fourth-quarter $100 Smash Pass for several years. Members can receive a free burger or sandwich every day for 100 days at participating locations. Subscribers must join Smashburger’s loyalty program. HuHot Mongolian Grill’s Grill Pass subscription, which was offered for two consecutive years, focuses on its signature stirfry entrees. Shopper spending grew by 80 percent and store visits by 30 percent. Subscribers spent 44 percent more than before, adding beverages, desserts and appetizers. For nine weeks last summer, Olive Garden featured a $100 Never Ending Pasta Pass, good for unlimited pastas, sauces, soups and salads. For $500, it offered a lifetime pass. Previously, Olive Garden has offered a fullyear pasta pass.

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Subscription Services Augment Customer Value Subscription services are a powerful way to attract, reward and maintain valuable customers. Those who join subscription programs are making a financial commitment, allocating a portion of their budget to that brand on a regular basis. When these By Michelle Tempesta, shoppers visit to pick up Paytronix a destination subscription item (e.g., coffee or fuel), they usually make additional purchases. This builds foot traffic, basket size and incremental sales. A subscription program, though, requires careful thought on the part of the company offering it. From both a business and customer perspective, it must be the right fit for an organization to realize its full potential. Here are some considerations: mindful of what you want to accomplish with your initiative. Do you want to drive customers from the pump to the store? Are you looking to drum up interest in a new offering, such as made-to-order food? Do you hope to attract customers who do not participate in traditional loyalty programs? Your goals should be instrumental in shaping decisions.

4. MAKE THE VALUE PROPOSITION A NO-BRAINER. The

subscription should be priced appropriately, so the brand does not lose money accommodating the average member. At the same time, customers need to see a program’s value upfront. 5. DRIVE CONSISTENT ENROLLMENT. It is crucial that signing up for the program and setting up monthly payments from users be fast and easy. This will allow you to continually grow your subscriber base. 6. NURTURE SUBSCRIBERS. The

initial value of the program should be enough to convince customers to enroll. But offering a basic product at a static price will not drive excitement indefinitely. Creating a way to communicate with members can help maintain momentum. It is important to understand the lifecycle of subscribers and identify when they are most likely to disengage (this often happens around renewal periods). Then, create incentives that offer value and maintain their interest. Media giant Netflix, for example, constantly offers new movies and shows to keep users engaged. Do the same with your program by offering perks like subscriber-only rewards or other surprise incentives.

1. SET CLEAR GOALS. Be

2. SPECIFY WHAT IS INCLUDED IN THE SUBSCRIPTION. Like a loyalty program,

a subscription offering should be straightforward and simple for customers to understand. Make sure you are clear about what is included in the program and what the cost is, so that you avoid confusion among both employees and customers. 3. DEFINE YOUR LOGISTICS. How

will guests identify themselves as a subscription member and collect merchandise? Will they use a physical card, a proprietary mobile app or phone number lookup? Will your supply chain be up to the task of filling large numbers of orders when the subscription service is launched?

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Michelle Tempesta is the head of marketing for Paytronix Systems Inc. Paytronix provides a single platform for convenience stores to reach, engage and motivate guests to visit more frequently and spend more with each visit through loyalty programs, digital ordering and omnichannel marketing. For software to support your new subscription program, please visit www.paytronix.com or call (617) 649-3300, ext. 5.


INDUSTRY ROUNDUP

Retailer Tidbits

Alimentation Couche-Tard Inc. is testing contactless checkout at a Circle K store in Arizona. A new pact with Standard Cognition will bring the payment option to more stores.

7-Eleven Inc. added a pickup order option to its 7NOW delivery app. The chain is also doubling its delivery footprint. Both experiences will be available in more than 1,300 cities, across nearly 2,000 stores.

Kwik Trip Inc. hosted its third-ever companywide Open Interview Day in mid-August. The event was held to support the retailer’s plan to hire more than 3,000 new employees.

Love’s Travel Stops & Country Stores is expanding its branded product line to include more candy options. The retailer also introduced Love’s Premium Water. QuickChek Corp., in a new partnership with DoorDash, is offering its complete foodservice menu for delivery. Since the rollout, 12-inch subs and six-packs of fresh-baked QuickChek chocolate chunk cookies are among the popular items.

The 1,850-square-foot location will focus on fresh food.

The Spinx Co. is bringing its legendary fried chicken to fans with its new Cluk Truk. The food truck will arrive this fall in South Carolina’s Upstate region. Wawa Inc. announced plans to build its first freestanding drive-thru in Falls Township, Pa. The new store model is part of Wawa’s mission to offer drive-thru and curbside pickup where customers can use technology to order.

7-Eleven Hawaii Inc. has teamed up with Hakuyosha Clean Living to provide 24/7, contactless dry cleaning and laundry services. The program initially launched at two locations, with plans to expand.

Eye on Growth

The new concept is a “store within a store” inspired by a traditional European bakery-café.

United Pacific acquired 95 convenience stores and gas stations from Platinum Energy and its related entities. The transaction also included three full-service car washes and one quick-service food location.

Cumberland Farms opened its first Farmhouse Fresh To Go store in Westborough, N.Y. It is the first of several Farmhouse Fresh To Go stores slated to open in New England by the end of the year.

Choice Market opened the doors to its third store. Customers at its latest Colorado location can order ahead for pickup or delivery via the Choice Market mobile app. Kwik Trip Inc. will acquire the assets of Stop-N-Go Convenience Centers for an undisclosed price. Stop-N-Go operates 36 stores in southern Wisconsin and northern Illinois. 24 Convenience Store News C S N E W S . c o m

Stewart’s Shops opened a “supersized” store in Port Henry, N.Y. The 4,186-squarefoot location offers an expanded fresh produce line and features a walk-up ice cream window with outdoor seating.


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INDUSTRY ROUNDUP

Supplier Tidbits

The company also enhanced the IQOS website to include virtual tutorials, with plans to add an expert video chat this fall.

Philip Morris USA brought its IQOS heated tobacco system to the Charlotte, N.C., market in mid-July. Its expansion strategy calls for IQOS to enter four new markets over the next 18 months. Swisher International launched an Inclusion, Diversity & Transformation strategy. The company appointed Alexandria Deal to serve as manager of inclusion, diversity and transformation and help lead the multi-step approach. Hostess Brands Inc. opened its new Innovation Lab on June 15. The lab employs approximately 20 researchers, product testers and bakers whose mission is to create new snack cakes that resonate with consumers.

Anchor Packaging LLC acquired Panoramic Inc., a manufacturer of thermoformed products used in freshfood applications. Over the past 14 years, Panoramic has grown at a double-digit annual rate. A&W Restaurants is expanding in the convenience channel through pacts signed with 10 new franchisees. The most recent multi-unit deal was signed in June and will bring three locations to Lafayette, La. GSTV is partnering with journalist and AfterBuzz TV co-founder Maria Menounos. She is producing custom-created content in short-form videos, which began airing on the GSTV network in June. Velvet Ice Cream is expanding its reach. The company is bringing its premium ice cream, sherbet and novelty products to c-stores across Indiana, Kentucky and West Virginia.

In Memoriam Convenience Industry Veteran Rich Mione Passes Away He retired at the end of 2019 after 46 years in the business LONGTIME CONVENIENCE store industry executive Rich Mione passed away at the age of 66.

After a 46-year tenure in convenience retailing, Mione retired at the end of 2019. He spent the last six years of his career with GPM Investments LLC, where he served as senior director of marketing. During his stint with the retailer, Mione watched the company grow from 300 stores to approximately 1,400. “We are deeply saddened to hear of the loss of Rich Mione,” said GPM Investments CEO Arie Kotler. “He was an invaluable asset to our company, and he will not be forgotten. Our thoughts and prayers go out to his family during this difficult time.” Throughout his career, Mione wore many hats at various c-store chains, including Open Pantry Food Marts, Crown Petroleum, VPS Convenience Group and finally, GPM. In July 2019, he was inducted into the Hall of Fame of the South Carolina Association of Convenience Stores. He had been on the board for 29 years and served as association president three times. The c-store veteran also served on the Convenience Store News Editorial Advisory Board for more than two decades.

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7 OUT OF 10 USERS SAY NICORETTE GUM TASTES BETTER THAN STORE BRAND* *Overall taste preference between coated gum flavors based on initial taste (1 minute of use).

Now Available At The consumer profile of convenience stores continues to shift to a younger demographic (Millennials (22%) and Gen X (22%) now make 44% of C-store shoppers), and those consumers are increasingly seeking healthier options at convenience stores from food and beverage to products to improve their health and well being. As a convenience retailer that prides itself on having a variety of products for everyone, Wawa has been expanding options for customers, now including access to a full-line of smoking cessation products. Since early July, Wawa now stocks a robust lineup of Nicorette smoking cessation products in 900 stores, including Nicorette Gum (4mg) in Cinnamon Surge, Fruit Chill and White Ice Mint and Nicorette Coated Ice Mint Lozenges (2mg and 4mg). Wawa is the first convenience store to provide a full chain launch with five Nicorette SKUs. For more than 20 years, Nicorette has been a leader in helping smokers fight cravings so they can successfully quit. Studies show that nicotine replacement therapy (NRT) products combined with behavioral support can double one’s chances of quitting smoking and the availability of Nicorette products at Wawa may help consumers finally start on their quit journey.

Behavioral support program increases chances of success. Read and follow label directions. ©2020 GSK group of companies or its licensor. All rights reserved.

CONTACT YOUR LOCAL NICORETTE SALES REPRESENTATIVE ON HOW TO ORDER OR EMAIL SCOTT.F.BREISINGER@GSK.COM


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Planters Pop & Pour Nuts provide the perfect personal snack container that fits in convenient spots like cup holders and backpacks. Each container features a resealable snap-top lid designed to lock in freshness. Planters Pop & Pour Nuts come in five varieties: Dry Roasted Peanuts, Honey Roasted Peanuts, Dry Roasted Sunflower Seed Kernels, Whole Cashews, and Dry Roasted Almonds. All varieties are available in recyclable single jars or multipacks.

SANTA FÉ is a new line of sparkling waters made with real fruit, including the first and only sparkling Arnold Palmer. Offered in 16-ounce single cans and in 12-packs, SANTA FÉ sparkling waters come in five varieties: Arnold Palmer, Lemon, Pink Grapefruit, Raspberry Lime, and Orange Mango. Each beverage is less than 20 calories per can, low-carb and gluten free.

Jelly Belly Gummies feature Jelly Belly Candy Co.’s famous true-to-life flavors in two delicious mixes: sweet or sour. The assorted sweet mix includes Berry Blue, Green Apple, Lemon, Orange and Very Cherry. The sour mix includes Sour Berry Blue, Sour Green Apple, Sour Lemon, Sour Orange and Sour Very Cherry. Both mixes are available in 4-ounce and 7-ounce bags, as well as 3.5-ounce Grab and Go bags. Jelly Belly Gummies are vegan, contain no animal gelatin, are made with colors from natural sources, and are non-GMO.

The Scripto Hybrid Lighter is designed to be the perfect crossover of a multi-purpose lighter and a pocket lighter. The product features a refillable tank, extended nozzle for safer lighting, adult-friendly push button ignition, and adjustable flame. Available in five colors — blue, green, red, white and black — the Scripto Hybrid Lighter is available in a 50-count display-a-tray and one pack open stock, with a suggested retail price of $1.99 per lighter.

AriZona Beverages New York santafesparkling.com

The Kraft Heinz Co. Pittsburgh & Chicago planters.com

Jelly Belly Candy Co. Fairfield, Calif. (800) 323-9380 jellybelly.com

5. Ezee-Mist Vehicle Sanitizer Dispenser Fragramatics’ Ezee-Mist vehicle sanitizer dispenser is designed to help convenience stores profitably meet the growing demand for quick, efficient vehicle sanitizing. The stainless-steel machine produces a 4-foot to 5-foot plume at one ounce per minute. The spray kills viruses, including COVID-19, bacteria and fungi. With coin-op, credit card and push-button options, the machine is easily adapted to virtually any operation requiring vehicle sanitization, according to the company. A mobile version is also available. Fragramatics Pine Bluff, Ark. (800) 643-1574 fragramatics.com

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Calico Brands Inc. Ontario, Calif. (800) 544-4837 marketing@calicobrands.com calicobrands.com


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6. OCB Virgin Unbleached Cone Packs OCB Virgin Cone Packs are virgin rolling papers prerolled and equipped with a tip to offer an easier way to pack, fill and enjoy. As part of the OCB Virgin product line, the cones feature a natural brown hue and always-sticks natural acacia gum adhesive. The cones are made of unbleached, chlorine- and dye-free fibers that are responsibly harvested. Vegan and GMOfree, the paper is ultrathin (12g/m2) and lightly porous for a slow burn and truer taste, with minimal ash. OCB Virgin Cone Packs are available in two sizes: 1-1/4 size, six cones per pack; and king size, three cones per pack. They are shipped 32 packs per display and 24 displays per case.

7. Warheads Bubble Gum & Candy

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9. Old Trapper Family Size Bags

Ford Gum teamed up with Impact Confections and its Warheads brand to produce a new line of bubble gum and candy products. The partnership brings the Warheads experience to other candy forms. Launched this summer, the line includes: a five-ball tube of gumballs in classic Warheads sour flavors Blue Raspberry, Lemon, Green Apple, Watermelon and Orange; and a Sour Watermelon Squeeze Candy. The gumballs have a suggested retail price (SRP) of 49 cents, while the Squeeze Candy has an SRP of $1.49. Both products are made in the United States.

Made for wellness seekers, Talking Rain Essentials is a line of better-for-you beverages designed to support good health. Featuring a mix of citrus and berry flavors, including Watermelon Lemon, Mixed Berry and Pineapple Mango, Essentials are packed with immune-supporting fundamentals such as zinc, vitamins B1, B2, B3, B6 and B12, and vitamins A and D. The beverages also provide enhanced hydration with added electrolytes. Essentials come in 12-ounce slim cans with bright colors to match each refreshing flavor.

Old Trapper now offers 18-ounce Family Size Bags of beef jerky to meet consumer demand for largerformat snacks. All four of the brand’s signature jerky varieties — Old Fashioned, Peppered, Teriyaki, and Hot & Spicy — are available in the new package size. Each bag features Old Trapper’s signature clear packaging, which lets consumers clearly see the quality and amount of product they are purchasing.

Ford Gum & Machine Co. Akron, N.Y. fordgum.com

Old Trapper Smoked Products Forest Grove, Ore. oldtrapper.com

Talking Rain Beverage Co. Preston, Wash. talkingrain.com

Republic Tobacco Glenview, Ill. (800) 288-8888 info@rpbtob.com

10. Vscan Sanitizing Solution for Keypads ATM and kiosk manufacturer Genmega Inc. introduces a patent-pending ultraviolet (UV) light sanitizing solution for keypads to help fight the spread of infectious disease and reassure users the machine they are using is safe. Ten seconds after each transaction, Vscan automatically disinfects the surface of the keypad, using an array of UV-C lights through a process that does not expose users. It kills up to 99 percent of viruses and bacteria automatically in a single pass, according to the company. Vscan also protects users from moving parts via a torque-sensitive mechanism that stops and restarts the process if any interruption or blockage occurs. Genmega Inc. Dallas (510) 314-8225 genmega.com 32 Convenience Store News C S N E W S . c o m

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The Small Operator’s Secret Weapon

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Retailers need to truly understand what makes their market area tick

I HAVE A SECRET.

It’s something that will help you, but it’s not new information. In fact, it might be right under your nose.

By Roy Strasburger, President, StrasGlobal

Now, for the secret. As I said, it is right under your nose. The way to stay in business and to stay relevant during these times is to become part of your neighborhood. You need to be very aware of the people who live around you.

I am often asked if there is a way for small operators to compete against their larger competitors. The question has taken on even more significance during this time of pandemic and the accompanying economic turmoil that has come with it. Not only do we have to worry about other convenience stores, but the competition with grocery stores and online delivery programs has also become even more intense.

In today’s world, when someone talks about “local” retailing, they are usually talking about artisan foods, farm-to-table products, and handcrafted organic consumables made by flannel-clad millennials who live in a forest. That’s not what I’m talking about here. With this strategy, everything you sell can come off a truck or from Sam’s. This isn’t about having special products; it is about having the right products.

Over the last few months, fuel gallons are down, people are making fewer trips outside the house, unemployment has risen, and consumers have less money to spend. All of these factors work against the small retailer. And, unlike our larger competitors, we don’t have the marketing budget, the brand recognition or, frankly, the support of our suppliers to help us win and attract new customers. As small retailers, we are on our own.

Part of this idea is very basic — discover the ethnic groups, economic levels and age demographics of the people who are your future customers. More importantly, you need to find out how your neighborhood lives. What are the rhythms and the cadence of the people who live around your store? What motivates them, what worries them, how do they relax, and what do they need to get through the day, the week or the month?

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SMALL OPERATOR

I have spoken to many retailers who are very handson in their shops. They have their regular customers who come in every day and buy the same items. The operator knows the products the regular customers want and, often, already has them out when they arrive — showing the customers they are valued, and making the transaction as easy as possible. That is excellent! However, I propose that this level of customer service is merely the baseline for staying in business throughout the rest of the 2020s. Typically, this type of customer loyalty has been developed by the store operator through the process of waiting for the customer to come into the store, recognizing the repeat customer, learning that customer’s preferences, and anticipating their arrival. Today, that level of care and attention needs to be taken to the next level. You cannot wait for your customer to come to you; you need to go out and find your customer.

You cannot wait for your customer to come to you; you need to go out and find your customer.

In my experience, most independent owners of small stores don’t live in the neighborhood where their store is located. They may live a couple of miles away or more. While they are familiar with the area where they do business, they don’t know their market area. The operator needs to take the next step — they need to truly understand what makes their market area tick. Gaining this information can be done simply and very inexpensively. All you really need to do is slowly drive, or preferably walk, through the community that surrounds your store. Pretend you are a visitor on a walking tour around the area and that it is your job to observe and make notes about what you see in a four- to six-block radius around your store. Walk up and down every street and go through some of the alleys. Notice the different types and styles of housing and the make and number of cars in front of each house. Do you see children? How old are they? Are there families living together or single people hanging out in the neighborhood? Are there a lot of people around during the day? Do you see them outside? If you go by at night, are they outside with friends or inside watching TV? If you look into a garbage can, do you see bottles or cans of products you don’t sell? What other types of shops and restaurants are in the area and what do they sell? Are they busy? All of these things will give you a better understanding and a more defined image of who your customers will be. You may have to make several trips before you see enough to come to a conclusion. Once you feel you have a deeper understanding of your community, you need to go back into your store and take another look at the products you’re selling and how you’re presenting them. Once you get past your top 20 sellers, does the remainder of your products reflect the neighborhood and the lifestyle around your store? Is the pricing in line with your understanding of your community — are your prices too high or too low? Are there opportunities or needs you have noticed from your tour that can be met by your 36 Convenience Store News C S N E W S . c o m

store? These could be items for special holidays, types of food, toys, products you saw in the garbage can, or other products inspired by what you have seen. This is about selling the things your customers want to buy; it is not about what you want to sell. One of the most important things to remember is that your community is not one monolithic entity. There are different types of people, genders, ages and ethnicities living around your store. The products in your store should reflect the mixture you have seen in your neighborhood. Your product selection should be as diverse as the community around you so that you can attract the greatest number of customers. The goal is not about becoming a specialist company. It is about understanding your community and providing them with the products they need and want. The more you reflect the makeup of your community, the deeper ingrained in the community your business will become. So, congratulations on now getting to Stage Four. (Stage One: treating the customer right; Stage Two: getting to know your neighborhood; Stage Three: carrying the right products and services.) Once you have an understanding of your community,


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walk through it again. Look for the places of worship, community centers, hospitals, nursing homes and senior care facilities. All of these places and organizations will have some type of community outreach program or constituents who need help and support. Get involved. Provide services, products and programs that help make your community a better place. What you do in the community will come back to you tenfold and people will remember you and your store. They will support you in difficult times the same way you supported them when they were having troubles. The greatest advantage that a small retailer has is the opportunity to understand, be a part of, and meet the needs of their local neighborhood.

The greatest advantage that a small retailer has is the opportunity to understand, be a part of, and meet the needs of their local neighborhood. Your store should reflect the values and the needs of the people who live around you. The critical part is going out to find out about your customer. Don’t wait for them to come to you. CSN

Roy Strasburger is president of StrasGlobal, a privately held retail consulting, operations and management provider serving the small-format retail industry nationwide. StrasGlobal operates retail locations for companies that don’t have the desire, expertise or infrastructure to operate them. Learn more at strasglobal.com. Editor’s note: The opinions expressed in this article are the author’s and do not necessarily reflect the views of Convenience Store News.

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FOR TRADE PURPOSES ONLY Winston® is a registered trademark of ITG Brands, LLC. ©2020 ITG Brands, LLC

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COVER STORY

40 Convenience Store News C S N E W S . c o m


HITTING THE

TURBO BUTTON ON INNOVATION

THE CONVENIENCE CHANNEL IS RAPIDLY EXPANDING THE WAYS IT SERVES CUSTOMERS AMID THESE UNPRECEDENTED TIMES

“CONVENIENCE” IS BEING redefined once again. This

time, driven by the sweeping changes happening in shopper behavior around the COVID-19 pandemic. C-store retailers and suppliers have had no choice but to quickly react and innovate in the way the channel serves customers — introducing and/or ramping up contactless shopping, mobile/online ordering, curbside pickup, delivery and more. Also, implementing new technologies around screening, sanitation, social distancing, inventory and supply chain. "Right now, we find ourselves with this amazing front seat to this changing landscape in the industry," Lori Stillman, vice president of research for convenience and fuel retailing association NACS, pointed out during the recent virtual Conexxus Annual Education and Strategy

A Convenience Store News Staff Report

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Conference. "It's almost as if somebody has hit the turbo button on disruption and we are fast-forwarding into the future at a speed none of us has seen."

RTI Research found that 30 percent of consumers have begun using contactless options since the start of the pandemic, and 70 percent of those newcomers expect to continue doing so in a post-COVID world.

According to the findings of the 2020 Convenience Store News Technology Study (see full report on page 104), a third of the convenience store IT executives surveyed this year say the COVID-19 pandemic has sped up their company’s implementation of new contactless technology, home delivery and curbside pickup programs. In addition, more than a quarter of respondents said the pandemic has sparked their interest in exploring these initiatives in the near future. Nearly three-quarters of the retailers taking part in this year’s study said they will spend more on technology and automation in 2020 than they did in 2019.

Digitally Driven

Of course, convenience stores are not alone in swiftly implementing new or expanded solutions that enable consumers to safely order and receive goods and services. "Health experts say there is no clear evidence that COVID-19 is transmitted by cash or credit cards, but retailers are putting health and safety first and have rolled out a variety of no-touch payment options in order to err on the side of caution," noted Leon Buck, vice president of government relations, banking and financial services for the National Retail Federation (NRF). "While mobile payments and contactless cards have accounted for a minority of payments in the past, the pandemic has clearly driven consumers to change their behavior and retailers to accelerate their adoption of the technology.” A joint research project by NRF and Forrester entitled The State of Retail Payments found that 67 percent of the retailers surveyed now accept some form of no-touch payment. This includes 58 percent that accept contactless cards that can be waved past a card reader or tapped on the reader (up from 40 percent last year), and 56 percent that take digital wallet payments on mobile phones (up from 44 percent a year ago). Many retailers also allow customers to pay online or over the phone and then pick up merchandise in-store or curbside, entirely avoiding the need to touch card readers, sign for transactions, or enter a PIN. On the consumer side, a recent study by

42 Convenience Store News C S N E W S . c o m

Convenience store retailers were already testing the waters of mobile ordering and delivery pre-pandemic, but once COVID-19 hit, it accelerated the existing trend and amplified its importance. What was once strictly about providing convenience is now also about providing safety. The power has shifted to the consumer, according to NACS’ Stillman, and the underling basis of competition has been upended. What’s more, she says signs of this happening were there before the COVID-19 pandemic took hold, but many c-store retailers were asleep. “We know that right now, customer journeys are more digitally driven than ever. The expectation in the eyes of a shopper is that online and brick-and-mortar stores work in tandem. Well, that's not a new idea. In fact, most would say retailers are finally waking up to what it is that shoppers have been asking from us for many years," she said. "There were many retailers who were asleep at the wheel, and I hate to tell you, but you don't get to hit the restart button," Stillman continued. "In fact, I think many savvy boards are going to demand after-action reviews as they look at their organization and their performance numbers, and they are going to want to dig deep to understand which of these outcomes were truly unpredictable and which ones have been the result of systemic failures in leadership." In many organizations, she says there has been "a fear, a refusal, to embrace this culture of innovation and experimentation to not learn, and test and learn." The retailers that are winning now, however, are those that were paying attention to the signs and were ready to respond and implement new solutions even before the novel coronavirus crisis.

Nearly three-quarters of c-store retailers say they will spend more on technology this year than they did in 2019.


VaporÕs next milestone is in September By September 9, 2020, those vapor brands who didn’t submit their Premarket Tobacco Applications (PMTAs) to FDA should be removed from your shelves.

For instance, E-Alternative Solutions (EAS) submitted PMTAs for a wide-ranging portfolio of Leap® and Leap Go® vapor products back in June, and provides ongoing updates to retailers regarding their status.

To avoid risking supply disruptions and potential FDA enforcement, you should demand updates from your vapor brands and manufacturers to learn if they submitted applications and for which products.

SXS

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BRA DS SUBM

1 2

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Robust PMTAs contain a large collection of scientific data and market research for a range of products. • EAS submitted PMTAs to FDA in June 2020.

FDA ACC P S

RR J C S

If application requirements are met, FDA issues Acceptance letters. • FDA delivered Acceptance letters to EAS in July 2020.

FDA F L S

3

Make sure your other vapor partners are also compliant.

RR J C S

If applications contain all necessary items to conduct a scientific, substantive review, FDA issues Filing letters. • FDA delivered Filing letters to EAS in July 2020.

FDA R V

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4

FDA conducts a substantive review of data and scientific information in the applications to determine if the products are appropriate for the protection of public health. • FDA is reviewing EAS PMTAs.

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FDA decides whether to authorize the continued sale of vapor products via Market Orders.

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FDA reviews records and reports to determine if a Market Order needs to be withdrawn.

B Make sure you’re working with vapor partners who are filing PMTAs and keeping you up to date!

To follow the progress of EAS and its products in the application process, visit EalternativeSolutions.com/News ©2020 EAS.

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COVER STORY

Convenience retailers that have been harvesting their loyalty program data were able to see the changing behavior as it happened and create offers that make sense to their customers. "We have many of those retailers in our own channel. Retailers who are committed to agile business models, to leaning in on innovation," she said, citing that their performances have been better than the average during the pandemic. “They embraced all kinds of cool ideas like contactless payment, buy online and pickup in store, or click and collect. There are a lot of different terms, but at the end of the day, when the shopper is afraid to come into the store and we can bring the store to them, that creates great solutions for us.”

Many consumers will stick to the habits they developed during the pandemic even after the danger has passed.

restaurants. She recently participated in a CSNews webinar entitled "Mobile Ordering: Stepping Up the Pace." To have the most success, she advises that c-store retailers should create an online menu that's both easy to navigate and thorough. Many customers will be new to the experience of placing an online order at a c-store and view the experience as novel. As such, the harder it is for them to check out, the more likely they will abandon the experience completely. Therefore, digital menus should be user friendly on mobile devices, as well as desktop/laptop computers. Retailers should make sure that customers can find exactly what they're looking for without having to spend a lot of time searching for it. It’s also important that c-stores integrate their digital ordering systems with their brand's loyalty program. If it isn't, consumers will either opt out of mobile ordering in order to receive their loyalty rewards, or they will choose mobile ordering but the brand will lose out on the valuable data associated with loyalty-program purchases, according to Blessing. "Loyalty is a huge insight to your customers' wants and needs," she said. "We don't want those to be mutually exclusive experiences." By making sure that the addition of each new online platform connects with those that already exist, c-store operators can create a cohesive, convenient experience for their customers, while maximizing their own ability to be properly informed for making key business decisions. Along with tracking valuable data, offering customized loyalty rewards and adding convenience and safety through new ordering and payment methods, digital platforms also can deliver customer feedback in realtime, which alerts retailers to problems they may be able to quickly correct and enables them to make it up to customers who have had a bad experience.

These ideas are not new. “In fact, I would tell you that many of them are probably on every single convenience retailer's to-do list and they've probably been there for far too long," Stillman said. In the current retail landscape though, with the pace of change rapidly accelerating, c-store retailers are realizing that these ideas must go from the drawing board to implementation.

Investing in the Future Mobile ordering and digital options are not a temporary bandage during this health crisis, but rather wise investments in a brand's future, noted Kiera Blessing, content specialist at Paytronix, a provider of customer engagement solutions and loyalty programs to c-stores and

44 Convenience Store News C S N E W S . c o m

Platforms can be set up to allow a store manager to immediately respond to a customer complaint with an apology and a variety of preapproved vouchers. Studies have shown that some consumers will use them and spend even more money than they otherwise would have — but more importantly, such an interaction can prevent them from being lost as a customer. While c-store industry retailers, suppliers and customers are looking forward to the day when the COVID-19 pandemic is no more, Blessing pointed out that many consumers will stick to the habits they developed during the pandemic even after the danger has passed, because they've grown accustomed to the convenience and the new way of doing things. “The pandemic won't last forever, but it will likely have a lasting impact on what consumers expect from c-stores and what level of convenience they are accustomed to," she said.


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COVER STORY

Kum & Go: Creative Responsiveness Kum & Go LC Chief Operating Officer Reed Rainey characterizes the c-store retailer’s COVID-19 related activity as “creative responsiveness and reprioritization,” using its learning to inform, adapt and emphasize innovation. “For me, innovation is both the new incremental improvements that differentiate your day-to-day business, and the broad, sweeping, revolutionary vaults that truly take your business to that next level,” Rainey told Convenience Store News. In early April, as part of a broader effort to give consumers more purchasing and fueling options during the pandemic, Kum & Go launched both full-service fuel and curbside pickup initiatives — first introducing them at select stores and then rolling them out chainwide. Based in Des Moines, Iowa, Kum & Go operates 400 stores across 11 states. For full-service fueling, customers must call the main store number upon arrival at the pump, then hand their payment card or cash to the store associate who will run the transaction and perform the fueling process. Employees wear a new pair of gloves for each transaction. For curbside pickup, customers call the main store phone number to place their order, which is then delivered to their vehicle upon arrival. Hours for these services vary by store, although at most locations, both are available from 7 a.m. to 7 p.m. Looking ahead, Rainey expects the pandemic will forever change the shopping habits of consumers based on three fundamental accelerations of behaviors and technologies that have already been underway across the convenience channel. They are: 1. Accelerated adoption of touchless transactions; 2. Accelerated adoption of enhanced-service options, including curbside/pumpside delivery,

pickup and “wherever/whenever/whatever” delivery; and

3. Strengthened loyalty to the most-trusted brands.

“I believe the pandemic is ushering in a host of new opportunities for the convenience channel. The consumer is looking for new options that better help them manage their risk, time and money,” he said. “We also are seeing how our customer values Fuel Better, our proprietary app feature that saves time and reduces touches at the pump by activating and paying from one’s phone.”

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MAPCO: Exceeding Expectations For MAPCO, the Franklin, Tenn.based operator of 340-plus company-owned c-stores in Tennessee, Alabama, Georgia, Arkansas, Virginia, Kentucky and Mississippi, innovation means being a pioneer on all fronts of the convenience store business model — not just meeting expectations, but exceeding them. This has been especially true during the COVID-19 pandemic. “Generating new ideas in the industry comes from listening to your guests, team members and other thought leaders in the convenience store space to provide solutions to everyday problems,” said MAPCO CEO Frederic Chaveyriat. “For many communities, convenience stores are an integral aspect of daily life and that’s why they were deemed essential businesses.” Pre-COVID, MAPCO found itself in a unique position: some of its newest innovations, including a newly redesigned app with touchless payment options and a DoorDash delivery partnership, were set to launch during this timeframe. However, the retailer knew it had to go back to the drawing board to make sure all of its guests had access to crucial products like food, water and fuel — and that’s where MAPCO’s Full Service+ offering was born. “During the height of the pandemic, we built a touchless fueling model at 14-plus locations across four different states and rolled out a curbside service at one of our stores in Clarksville, Tenn,” Chaveyriat said. “This offering was launched in tandem with our stringent cleaning protocols, disinfecting process and COVID-19 safety precautions.” Continuously evaluating the pandemic, MAPCO has since decided to suspend the Full Service+ program to focus its efforts on more long-term touchless offerings. To that end, the chain is finalizing its brand-new Scan N’ Go and Order Ahead services, which will be available via the retailer’s mobile app. With these programs, guests will have the ability to pick up items on the go and avoid the traditional checkout process. “We are proud of our quick thinking and [Full Service+] pilot program as it represents the spirit of MAPCO always finding a different way to do things,” Chaveyriat said. “Whether we realize it or not, the pandemic has drastically changed everyday aspects of our lives, and that includes the way we shop. Long before the COVID-19 outbreak, it was proven that the traditional retail model simply wasn’t enough to meet the needs of both guests and team members. We are all living busy lives and looking for ways to make essential tasks and duties more efficient.” The chief executive expects more c-store operators will shift to advancing their touchless pay offerings to make the customer experience more efficient and customizable.

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Kwik Chek: Leaning Forward Into Technology As incoming chairman of industry trade association NACS, Kwik Chek Food Stores CEO Kevin Smartt wants to focus on the health of the convenience channel moving forward and encourage the industry to "lean forward into technology.” In May, Spicewood, Texas-based Kwik Chek relaunched its loyalty app and streamlined the signup process to offer more convenience and rewards for users. The kwikchek app now allows customers to sign up for a kwikcard Rewards payment card in the app itself instead of picking up a card in-store and enrolling online. "I think we are going to continue to lean heavy and hard into the further continuance of our mobile platform loyalty program. We've seen a significant increase of usage with it during COVID," Smartt said. "That's been positive for us; that we were already down that pathway and had a fairly sophisticated and established program." The kwikchek app also offers mobile payment at the cash register or fuel pump. When buying gas, customers can turn on and authorize the gas pump from their cell phone and pay for the transaction through the app and from their car using mobile payment technology powered by P97 Networks. Smartt thinks every convenience store in the U.S. ought to have mobile payment. “How we get that done, whether it is a universal-wide app, I don't know," he said. "When a customer pulls onto a convenience store lot, they [should] know they can pay with their mobile phone; it's not a guess." Speaking during the recent Conexxus 2020 Annual Education and Strategy Conference, Smartt said the next phase for Kwik Chek will include mobile ordering — which is expected to go live before the end of the year. "We think that is essential," he said. Creating a “frictionless ethos” is also in the works. “That doesn't mean it's all hands off; it means it's the customer's option of how they want to shop," explained Smartt, who is also chairman of the Conexxus board of directors. For Kwik Chek, that will mean providing traditional checkout, self-checkout, mobile checkout inside the store, and mobile ordering with curbside delivery or on-demand home delivery. The company is currently testing mobile checkout with Skip. All of its new stores will have curbside pickup; it is looking into third-party delivery partnerships; and also exploring drive-thru for either traditional shopping or pickup only. "That's where we have to get to. The customer has the options to shop in our environment free of restraints on how they want to shop," he said. "We have to figure out how we build the structure to accommodate that. Our challenge as an industry is that we are so fragmented in technology that it does take serious investment to create that kind of ethos or environment where that can happen.” In planning new-build stores, conversations are happening now around what modifications should be made in the store design to accommodate this new frictionless ethos of shopping. "Some of that may be a walk-up window. Shrinking inside seating capacity and moving it outside is another thing on our drawing board, and that was a big lesson in this pandemic as outside dining stayed open," Smartt said. 50 Convenience Store News C S N E W S . c o m


StrasGlobal: Targeted Innovation At StrasGlobal, the word “innovation” means meeting the changing demands of the customer. “One can innovate, but if you’re not aligned with what the customer is looking for, you’re innovating for nothing. It has to be targeted innovation,” said Roy Strasburger, president of StrasGlobal, a contract operations provider that services retail locations for companies, who for various reasons, don't have the expertise, infrastructure or desire to operate them. Currently, it is operating 25 stores around the country. Most of its clients are one to 10-store owners. The innovation lens at StrasGlobal is finely honed. There are three main focuses: serving its customers better, increasing the company’s efficiency, and improving the lives of its team members. Since the coronavirus pandemic took hold, Strasburger said he and his team are innovating more than ever because the pandemic exposed some weaknesses. StrasGlobal quickly realized that it did not have a way to communicate with customers to let them know that its stores were open and had essential items. It had no online presence in place. So, the company is now accelerating efforts around implementing a loyalty program to open a channel of communication that did not exist before and to gain valuable information about its customer base. “Originally, we were thinking of loyalty as being a marketing and promotional tool. Now, we’re looking at it foremost as a communications tool,” Strasburger explained. The pandemic also led StrasGlobal to realize that it needed to expand the way that its stores serve customers. In May, it launched online ordering with both curbside pickup and home delivery options. Strasburger foresees contactless payment, online ordering and delivery becoming entrenched in the post-COVID shopping habits of Americans. Other ways he sees the pandemic changing the convenience channel for at least the next 10 years are: • People will be interested in local shopping opportunities because they’ll want to have a fallback option in case of another lockdown situation. • Health and safety will be a competitive edge. Retailers will be able to use this as a differential in the marketplace, appealing to those people who will still be aware a few years from now. He also anticipates more local health and safety regulations being put in place once the dust settles. • Convenience stores will go back to what they were like in the 60s and 70s. They will start becoming small markets again. StrasGlobal is expanding center-of-store items. • Loyalty programs will continue to grow in importance. The good news for the c-store industry’s small operators, according to Strasburger, is that they are well-positioned to quickly react to however the business changes in the future. "Adaptation is a huge advantage of the small operator over larger retailers. We can improvise and pivot quickly, and if something doesn't work, we can change it just as quickly,” he said. “We want to be as indispensable as possible."

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Alltown Fresh: Contactless Shopping Times Four In recent years, choice and variety have become increasingly in-demand qualities for prepared food and dispensed beverage programs. This spring, when the COVID-19 pandemic prompted radical shifts in both business operations and consumer behavior, Alltown Fresh extended those attributes beyond its menu to the purchase process itself. The retailer in May simultaneously launched four different methods of contactless shopping: • Fresh Crates: Crates of fresh groceries and other necessities that can be ordered 24 hours before pickup. Featured items include locally sourced fruits and vegetables, meats from family farms, and organic pantry staples. • Meal Prep & Provisions: Preassembled meal kits to help families quickly prepare dinner. Customers can place an order before noon to have their meal prep kit ready for pickup by 5 p.m. Each prep kit serves a minimum of four people. • Curbside Pickup: Customers can call ahead to order menu items such as bean-to-cup organic coffee, fresh smoothies, artisan sandwiches and composed salads, along with traditional convenience items like household essentials. Employees bring the items directly to the customer’s car. • Delivery: Alltown Fresh is partnering with third-party service Grubhub to deliver its menu of fresh food and beverages directly to customers' homes. The quick pivot to contactless had some basis in pre-pandemic plans, but was largely a new effort that required significant effort from the Waltham, Mass.-based chain's team. "Not all of the shopping methods were in the works prior to the pandemic, but they were certainly on our radar as our team is always thinking about ways to make our guests' lives easier," Melissa Mancini, social and digital marketing manager for Alltown Fresh, told Convenience Store News. "For example, we had been planning to launch delivery with Grubhub later on in 2020, but it was launched in under two weeks once COVID hit. For several weeks, it was all hands on deck to launch our contactless shopping methods.” The retailer's multipronged contactless approach stands out for its leveraging of an existing strength — a focus on fresh, healthy items made using locally sourced ingredients. With not one, but several different contactless options, Alltown Fresh gives customers the flexibility to decide what they feel is the safest and most convenient method of buying food in the midst of the pandemic. The emphasis on freshness in all four contactless options is particularly important in today's convenience market, as Mancini noted that fresh food is becoming more important than ever to customers who care more about what they put into their bodies. "People are now willing to go the distance for fresh options, and we're hoping to serve folks in the communities in which we operate, in addition to those who will travel for fresh," she said. Since launching in May, delivery has outperformed all the other contactless shopping methods, and the retailer expects it to continue playing a crucial role after the pandemic. "While delivery was certainly popular prior to the pandemic, it's become table stakes," Mancini said. Curbside pickup is also anticipated to continue in importance post-COVID, as it offers a new level of convenience that c-store customers hadn't previously experienced.

52 Convenience Store News C S N E W S . c o m


While the development and rollout of Alltown Fresh's contactless options may have been rushed due to the pandemic, the process reflects the retailer's philosophy on innovation. "As a customer-driven brand, consumer needs are behind every decision we make. Innovating is about developing products and services that meet those consumer needs in a way that the industry has not seen before," Mancini explained. "For example, while we do sell groceries, it wasn't a focus of ours prior to the COVID outbreak. Once we heard consumers were having a difficult time getting groceries at supermarkets (waiting in lines, empty shelves, etc.), we decided to fill that need with our Fresh Crates program, which offers guests a crate full of either produce, protein or pantry items available for curbside pickup to save them the trip to the grocery store." Alltown Fresh plans to continue stepping up its innovation efforts. The company introduced an innovation email to field ideas from its employees around new ways of doing business, and it established an internal team to manage such ideas. The retailer is also looking to offer a fuller menu of products for delivery, including consumer packaged goods. "We're always tweaking our offerings based on consumer feedback," Mancini said. "Whether it be changes to our menu, ingredients or technology, we're continuously making improvements." CSN

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INNOVATION H

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COVID-influenced packaging, health and flavor pairings highlight our 24th annual Best New Products Awards competition By Susan Durtschi, Past Times Marketing

of entries in the 2020 Convenience Store News Best New Products Awards contest resulted in some keen competition among suppliers jockeying to introduce the most innovative new items to the convenience store industry in the past year.

A RECORD NUMBER

The 2020 Best New Products Awards winners are:

From among nearly 100 entries, consumer judges chose 38 products new to c-store shelves for recognition in the 24th annual competition. The Best New Products Awards program recognizes the marketers that introduced the most innovative, high-quality products that meet consumers’ evolving needs and fit a c-store retailer’s value proposition. Judging was supervised by Past Times Marketing, a New York-based consumer research and product testing firm. Contest entries were rated and awarded points by consumers based on the criteria of taste, value, convenience, healthfulness, ingredients, preparation requirements, appearance and packaging. Products honored this year range from sparkling waters, wine cocktails, hard seltzers and caffeine-laced drinks, to no-sugar, keto and better-for-you items — many in COVID19-friendly packaging.

56 Convenience Store News C S N E W S . c o m

ALTERNATIVE SNACKS/BARS:

ONE Peanut Butter Cup, ONE Brands

Protein snacks show no signs of leveling off. The ONE Peanut Butter Cup protein bar is everything consumers love about this candy favorite in a craving-satisfying, gluten-free snack bar. It combines salty, nutty peanut butter and the flavor of chocolate with 20 grams of protein and just 1 gram of sugar. It’s made to power workouts, mornings, all-day meetings, or afternoon slump pick-me-ups. “It’s almost guiltfree,” one tester noted.


©2020 The Coca-Cola Company

T


FEATURE

ALTERNATIVE SNACKS/ MEAT SNACKS:

retailers that this category deserved modern selling methods. All items in the product line are individually wrapped for safety, instead of selling from an open container, and provide retailers a product that exceeds all food-safety protocols in these safety-conscious times.

Old Trapper Old Fashioned Beef Jerky Big Bag, Old Trapper

While some meat snack brands embrace the trend of decreasing product size and keeping the price the same, Old Trapper created a new “Big Bag” of its popular beef jerky. Weighing in at a full quarter-pound, the Big Bag features Old Trapper’s signature clear view packaging so that customers can see the amount and quality of the beef jerky they’re buying, in a resealable bag. ALTERNATIVE SNACKS/OTHER:

Big John’s Pickled Eggs, Red Smith Foods Inc.

Big John’s individually wrapped pickled eggs are the ultimate protein snack. Hard-boiled egg sales have been driven through the roof by keto and low-carb dieters. Big John’s Pickled Eggs provide a shelf-stable merchandising opportunity to capitalize on the ever-present popularity of protein snacks. Red Smith Foods responded to feedback from

BEER:

Blue Moon LightSky Citrus Wheat, Molson Coors Beverage Co.

Blue Moon LightSky is a lighter-profile wheat beer in the Blue Moon family of beers from Molson Coors. It gives shoppers a reason to buy both Blue Moon Belgian White and LightSky, which is the No. 2 growing craft brand and has repeat rates higher than any other national new launch, according to the company. The 12-ounce can is sleek and narrow, and contains only 3.6 grams of carbs and 95 calories with a 4 percent ABV. Our testers were impressed with the flavor considering the low carbs and ABV, and said it was a great way to introduce new recruits to beer drinking. Our panelists said it is “light but flavorful” and “perfect to hand out at the beach.”

The 2020 Convenience Store News’ Top Women in Convenience awards has gone virtual! TWIC 2020 Virtual Watch Party will be an experience like no other, recognizing the integral role women play in convenience retailing. Women will be honored from the retailer, wholesaler and supplier communities in four different categories:

SPONSORSHIPS ARE NOW AVAILABLE!

AWARD CATEGORIES* Women of the Year Senior Level Leaders Rising Stars Mentors

SPONSORSHIPS AVAILABLE! PRESENTED BY

TWIC20_HalfPgAd_0920.indd 1 CSNEWS.com 58 Convenience Store News

CONTACT PAULA LASHINSKY Vice President and Brand Director 917-446-4117 • plashinsky@ensembleIQ.com

8/28/20 11:07 AM


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FEATURE

CBD:

Forth CBD Soft Chews, E-Alternative Solutions

CBD products are more than just a trend — wellness is becoming front and center in what adult consumers want out of their products. To meet shoppers where they are, Forth CBD Soft Chews are offered at the c-store counter. High-quality Forth CBD is delivered in small two-serving packs, with each chew containing 25 milligrams of full-spectrum CBD. The packs are highly portable and can fit into a pocket, glove box or purse. At a suggested retail price (SRP) of $4.99 a pack, Forth CBD Soft Chews are an ideal impulse purchase and a perfect opportunity for trial and introductory purchasing without going to a CBD specialty store. Forth CBD Soft Chews are not marketed as nutritional supplements and make no therapeutic claims. Of the fruit flavors available — Cherry-Berry and Citrus — testers liked the latter best.

CANDY/NON-CHOCOLATE:

Starburst Swirlers — Cherry-Lemon, Mars Inc.

Starburst took its very popular individually wrapped square chewy candy and shaped it into one juicy stick, fusing two flavors together. Starburst Swirlers is a great example of innovation that leverages key trends and meets consumer preference by offering a new way to enjoy Starburst. The mashups come in three mouthwatering flavors: CherryLemon, Strawberry-Orange, and Cherry-Strawberry. Cherry-Lemon earned the highest score among testers. The texture is the same as the traditional Starburst square treat, and the two-in-one flavor makes for a nice punch. It’s a new way to enjoy a favorite treat, plus the candies come individually packed.

CANDY/CHOCOLATE:

KIT KAT Duos Mint + Dark Chocolate, The Hershey Co.

KIT KAT Duos Mint + Dark Chocolate from Hershey features a mashup of two iconic flavors: mint crème on the top and dark chocolate on the bottom, all surrounding light and crispy wafers. This innovative pairing works remarkably well and does not sacrifice the KIT KAT experience of the crunchy wafer texture and crème. This was a firm favorite among the panelists, who called it “a dessert version of a KIT KAT bar.” CANDY/GUM:

REV Energy Gum — Peppermint, Rev Gum

Sometimes, drinking coffee or an energy drink just isn’t an option, so a good caffeine gum can be the answer to get you through those Zoom meetings or road travel. Rev Energy Gum offers a more consistent dose of caffeine than coffee, without the additional sugars of a coffee creamer. It has 100 milligrams of caffeine, a tasty peppermint flavor and is sugarless, making it ideal for diabetics as well. The activation time with Rev Energy Gum is much quicker than coffee, too, offering the perfect pick-me-up without the sugar crash.

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CANDY/NOVELTY & SEASONAL:

Sour Punch Straws — Grape, American Licorice Co.

“Embrace Your Punch” is the theme this year for American Licorice’s Sour Punch Straws. Back by popular demand, Grape Sour Punch Straws had quite the following in the 1990s but were dropped from the lineup. Now, each six-pack of Grape Sour Punch Straws packs a sweet and sour punch and is smothered in the product’s signature sour sugar blend. Sour Punch Straws are proudly manufactured in the U.S. Our testers loved this old-school candy. DAIRY PRODUCTS:

Frigo Cheese Heads 2-Pack Combo, Saputo Cheese USA Inc. Frigo Cheese Heads’ newest innovation is a two-in-one snacking combo for people on the go. This high-protein snack or meal replacement is perfect for grab and go. The combo includes both a meat stick and a cheese stick in three flavor combinations:


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FEATURE

Cheddar/Beef, Colby Jack/Turkey and Swiss/Ham. Designed to be enjoyed by millennials, Generation Z and baby boomer consumers, the vibrant green packaging is eye-catching and leaves the consumer wanting to try the product. Easy-to-merchandise display cartons are perfect for smaller shelf sets, allowing for more assortment and variety.

DELI PRODUCTS:

Van’s Kitchen 4-Pack Egg Rolls — Vegetable, Van’s Kitchen

Van’s Kitchen Egg Rolls are a versatile offering that meets retailer and consumer demand for Asian flavor. Shipped frozen and sold from a refrigerated case with dipping sauce, this product can be microwaved for immediate consumption or taken home and cooked in a toaster oven, conventional oven, convection oven, air fryer or traditional fryer. Four varieties are offered: Chicken, Pork, Orange Chicken, and Vegetable. Our panelists gave five stars to the quality and were partial to the vegetable version. They felt this is a perfect touch-free solution amid COVID-19 that fills an immediate need as a complete meal or snack solution. EDIBLE GROCERY:

Del Monte Fruit Crunch Parfait — Blueberry, Del Monte Foods Del Monte Fruit Crunch Parfaits provide a delicious non-dairy alternative to yogurt. With creamy, crunchy and fruit-filled layers of goodness, they are the ideal grab-and-go snack to enjoy any

SAVE THE DATE

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CONTACT DON LONGO TO REQUEST YOUR EXCLUSIVE INVITATION. • CHARLOTTE, NORTH CAROLINA DLONGO@ENSEMBLEIQ.COM

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FEATURE

time of day, according to the maker. The parfaits are a coconut-based, non-dairy yogurt alternative with one full serving of real fruit pieces and no artificial flavors or preservatives. Offered in a convenient grab and-go cup, the flavor preferred by our testers was Blueberry. They also liked the crunchy granola layer that is a separate mix-in after opening. FLAVORED MALT BEVERAGES:

Mighty Swell Cherry Lime, Mighty Swell

The hard seltzer train does not seem to be slowing down, not even in a pandemic. Consumers who used to drink it at bars are now buying it for home. Mighty Swell fits the flavor-forward seltzer niche that is overlooked by the zero-sugar and low-calorie alternatives, according to the company. In a 16-ounce can, the beverage boasts 150 calories, 6 grams of sugar, a 5 percent ABV and, unlike some other brands, real fruit juice. Panelists ranked the cherry lime flavor as the best.

cheese on a chipotle “English” muffin. Our panel said these components were very satisfying, and the sandwich a perfect size. The mild spicy flavor trend continues with this portable, high-flavor offering. FOODSERVICE/CONDIMENT:

Keto Vanilla Bean Syrup with MCT, Jordan’s Skinny Mixes/ GoodWest Industries

Keto Vanilla Bean Syrup with MCT offers a healthier sweetener alternative to the sugar-laden coffee bar and appeals to the keto dieter. This top-selling flavor is now sweetened with Stevia, monk fruit and erythritol. It provides a daily dose of MCT oil, a popular supplement used to aid fat loss, increase energy and reduce cravings, made popular by the keto community. Keto Vanilla Bean Syrup with MCT is the perfect way to make favorite beverages taste indulgent, but without the unwanted calories.

FOODSERVICE/BAKERY:

Donut Hole Thaw and Serve Glazed Apple Filled Fritter, Baker Boy

The Donut Hole Thaw and Serve line consists of 15 fully finished doughnuts specifically aimed at the convenience channel. Delivered frozen and fully finished, the line provides an easy fix to the labor issues that have left many c-store retailers unable to properly sell doughnuts to meet consumer needs. The products can be sold as singles inside of a bakery case or in a six-pack tray with branded packaging, providing a touch-free option. Our testers thought the six-pack tray was a clever size, simple, and allowed for less waste. The panel was impressed by the quality, freshness and variety of products. The new Glazed Apple Filled Fritter, a folded cinnamon doughnut injected with apple filling, got exceptionally high marks for freshness and texture. FOODSERVICE/BREAKFAST:

Southwest Muffin Sandwich, Orion Land Mark

The Southwest Muffin Sandwich is a unique breakfast offering that plays on the growing trend of southwestern flavors, featuring sausage, jalapeño, egg and

64 Convenience Store News C S N E W S . c o m

FOODSERVICE/DINNER & HOME MEAL REPLACEMENT:

Ready-to-Stretch Sheeted Pizza Dough, Rich Products

Rich’s has reimagined pizza dough. Six-inch and 12-inch Ready-to-Stretch Sheeted Pizza Dough is the ideal solution for c-store operators who want to offer high-quality, premium pizza with labor savings. Take the dough out of the cooler, stretch it to your signature shape, and stick it right into the oven. When baked, the flavorful dough cooks to a golden-brown color, a crisp exterior texture and a perfect pizza bite, plus it conveys a fresh-baked aroma throughout the store. The dough also can be used for calzones, Stromboli, breadsticks and more. Introduced in the third quarter of 2019, the product meets Rich’s Baseline Clean Label, which means it does not contain artificial colors, flavors and sweeteners, high fructose corn syrup, or hydrogenated oils. It has a 120-day frozen shelf life. Our testers tried the 12-inch size and found


FEATURE

it very easy to thaw, handle and cook in a variety of ovens. They called it “authentic” and “not too doughy.”

premium cuts of pork, cheddar cheese, and fresh-diced jalapeño peppers. It can be prepared using a roller grill, microwave, flat top, steamer, gas grill or convection oven. A four-hour hold time results in greater customer satisfaction and less product waste. Our panel liked the flavor and components of the sausage. The perfect texture of the sausage casing was mentioned several times as well. FROZEN FOODS:

Caulipower Riced Cauliflower — Baja Style, Caulipower

FOODSERVICE/LUNCH:

Ultimate Jalapeño Cheddar Sausage, Johnsonville

To maximize profit potential at the roller grill, a trusted brand, great-tasting products made with the finest ingredients, and a variety of flavors play important roles. Johnsonville checks all these boxes with its Ultimate Jalapeño Cheddar Sausage. This flavorful sausage is made with

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Caulipower has reinvented riced cauliflower in an exciting betterfor-you, better-tasting and more convenient version with the first-ever frozen cup of riced cauliflower. Perfect for a healthy snack, a side dish or lunch on the go, it contains only 3-5 grams of net carbs per serving without any added sugar. The nutritious rice substitute is 100-160 calories per


FEATURE

cup, depending on the flavor. Caulipower’s Riced Cauliflower comes in three flavors: Baja Style, Curried and Sesame Citrus. Sold in eye-catching packaging that is microwavable, reusable, recyclable and dishwasher-safe, consumers can heat it up and eat it directly from the container. FROZEN NOVELTIES:

TWIX Cookies & Creme Ice Cream Bars, Mars Inc.

The winning combination featured in TWIX Cookies & Crème Ice Cream Bars brings two iconic favorites together: cookies and creme, the world’s top cookie flavor; and the best-selling cookie bar in the chocolate category, TWIX. This frozen confection is packed with creamy vanilla ice cream mixed with chocolate cookie pieces and smooth caramel topped with crunchy chocolate cookies. The product comes in 2.9-ounce singles that are individually wrapped. GENERAL MERCHANDISE:

Scripto Hybrid Lighter, Calico Brands Inc.

Scripto’s Hybrid Lighter is designed to be the perfect crossover of a multi-purpose lighter and a pocket lighter. The product features a refillable tank, extended nozzle for safer lighting, adult-friendly push button ignition, and adjustable flame. At less than five inches long, this lighter can easily fit in a pocket or a purse.

HEALTHY SNACKS:

CLIF Coffee Collection Dark Chocolate Mocha Energy Bars, CLIF Bar

Crafted with sustainably sourced organic coffee beans from Colombia, CLIF Coffee Collection Energy Bars are available in three invigorating flavors: Dark Chocolate Mocha, Caramel Macchiato, and Vanilla Almond. Our testers preferred the Dark Chocolate Mocha flavor with its fudgy consistency, chocolate-covered organic coffee beans, and chunks of dark chocolate mocha. With an espresso shot’s worth of caffeine, these bars are a tasty way to kickstart the morning or to enjoy anytime. Due to stay-at-home boredom and COVID-19 stress, the consumer is looking for a little pick-me-up. Even when the coffee shop is out of reach, these are a satisfying, quality choice. OTHER TOBACCO PRODUCTS/CIGARS:

HEALTH & BEAUTY CARE:

Tums Chewy Bites Mixed Berry, Convenience Valet

Tums Chewy Bites Mixed Berry are delicious, like a fruity, chewy candy. The four-count pack is a great new size alternative that can be merchandised on the shelf or pegged, which is important for stores with limited space. Its big brother, Tums Chewy Bites Assorted Berries 32-count, is the No. 4 dollar-ranking antacid SKU in Total US AOC, according to Nielsen. There is clearly an opportunity gap to be filled as this same item ranks No. 27 in convenience channel antacid sales. With a suggested retail price of $2.49, the four-count SKU is affordable to most shoppers and offers a lower barrier for trial than the $7.98 SRP of the 32-count. Skewed toward millennials and Generation X, Tums Chewy Bites have taken over from traditional chewable roll tablets.

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White Owl Blackberry Mojito Limited Edition, Swedish Match

Limited-edition offerings, like White Owl Blackberry Mojito, keep c-stores’ cigar assortment exciting with value pricing and new flavor profiles. White Owl cigarillos continue to intrigue consumers and create demand with punching flavor in each puff, and they cover the flavor niche in the cigar market. This product was a favorite of female Gen Z testers. OTHER TOBACCO PRODUCTS/E-CIGARETTES & VAPOR PRODUCTS:

Legal Lean Disposable Grape Pod Device, Legal Lean

The Centers for Disease Control and Prevention has reported that 70 percent of American adults suffer from insufficient rest or sleep at least once a month and of those, 11 percent say they get insufficient sleep every night. The Legal Lean


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FEATURE

Disposable Grape Pod Device is designed to help with relaxation and sleep. The formulation contains zero nicotine and offers up to 300 breaths per device. With the ability to regulate the dosage based upon the number of breaths taken, customers can finely tune their dose according to their overall need. Our testers found this product effective for relaxation and liked the nifty pod unit. The product also has a great grape taste. OTHER TOBACCO PRODUCTS/ SMOKELESS:

Velo Nicotine Lozenges, R.J. Reynolds Vapor Products

According to McKinsey’s U.S. Tobacco Market Landscape Strategic Assessment, June 2019, the oral nicotine category is expected to grow at approximately 70 percent annually as adult tobacco consumers expand beyond traditional tobacco. VELO dissolvable nicotine lozenges are mess-free, hassle-free and tobacco-free. They were a big

hit among adult panelists who want a discreet “anytime” alternative to traditional combustible and smokeless tobacco products. The hard lozenges are firm, hold their shape as they dissolve, and have a crisp mouthfeel. Every VELO lozenge contains approximately 1.7 milligrams of nicotine. The mint flavor was the frontrunner with our testers.

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• Retailer and supplier round table discussion examining contactless payments, online ordering, curbside pickup and home delivery, and increasing payment options RSVP

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FEATURE

PACKAGED BEVERAGES/CARBONATED SOFT DRINKS:

Sparkling Ice Cherry Vanilla +Caffeine, Sparkling Ice

Sparkling Ice +Caffeine beverages are billed as the perfect blend of taste, hydration and energy, with zero calories and zero crash. Sparkling Ice introduced a new flavor in its +Caffeine line, Cherry Vanilla +Caffeine, pairing red cherry with a sweet vanilla twist. Packaged in a 16-ounce can with just the right amount of fizz, this soft drink is keto-friendly, contains no aspartame, and offers antioxidants and vitamins, including vitamins A, D, B6 and B12. Our panelists liked the “cherry tart taste” and appreciated that the can’s design clearly states zero calories and caffeine on the top edge. PACKAGED BEVERAGES/ ENERGY DRINKS:

AMIN.O Energy Sparkling + Electrolytes — Mango Pineapple Limeade, Glanbia Performance Nutrition NA

Consumers can start fast and finish strong with their indoor or outdoor workout with Optimum Nutrition’s AMIN.O. Energy Sparkling + Electrolytes hydration drinks. They offer a combination of 5 grams of amino acids; 100 milligrams of caffeine from natural sources, including green tea and coffee bean extract, to support energy and focus; and electrolytes to support performance, endurance and active living. The sparking beverages are zero sugar and only 5 calories per 12-ounce can. The Mango Pineapple Limeade flavor was light on aftertaste, according to our panel, which also awarded extra marks for zero calories and the addition of electrolytes.

a full variety of refreshingly healthy drinks. The packaging was especially appealing to our panel. PACKAGED BEVERAGES/ RTD COFFEE:

Black Rifle Coffee Co. Expresso with Cream, Black Rifle Coffee Co.

Black Rifle is a veteranowned coffee company serving premium coffee to people who love America. Its new RTD canned espresso is made with coffee-forward flavors, 100 percent Columbian coffee, premium ingredients, and 200 milligrams of caffeine per can. The craft-made coffee beverages feature the right amount of sweetness to balance the coffee-forward flavors, while maintaining lower sugar content than similar products. Two flavor profiles are available: Espresso with Cream and Espresso Mocha. Our panelists liked both, but thought the Espresso with Cream was “kickass good.” They liked it super-chilled in the can for the best taste experience.

PACKAGED BEVERAGES/JUICE DRINKS:

OKF Watermelon with Aloe, OKF Aloe Vera King

OKF, which introduced the very first aloe drink in the market, has now debuted OKF Watermelon with Aloe. Chewable aloe pulp with real watermelon juice makes this drink unique and appealing. Additionally, OKF Watermelon with Aloe boasts health benefits, including restoring energy and balance. The product won the 2019 Monde Selection Gold Award for its excellent taste. From kids to adults, it can fill a niche among customers looking for

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PACKAGED BEVERAGES/RTD ICED TEA:

INOTEA Bubble Tea — Honeydew, DD&B Solutions LLC

Popular with a younger following, bubble tea has traditionally been available through cafés, restaurants and do-it-yourself kits at home. INOTEA Bubble Tea is the first of its kind to be sold in c-stores in the U.S. and can be a perfect post-pandemic beverage to enjoy in the safety of one’s home, according to the maker. INOTEA Bubble Tea comes in Taro, Brown Sugar and Honeydew flavors in 16.9-ounce cans. Our testers liked the Honeydew flavor the most, calling it “unique” and a “conversation starter.”


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FEATURE

dients include 50 percent more electrolytes than Powerade Zero. A unique ION4 Advanced Electrolyte System helps replace the four electrolytes people lose when they sweat: sodium, potassium, calcium and magnesium. Of the three flavors, Citrus Blast was our testers’ favorite. PACKAGED BEVERAGES/OTHER:

AHA Sparkling Water — Orange + Grapefruit, The Coca-Cola Co.

PACKAGED BEVERAGES/SPORTS DRINKS:

Powerade Ultra, The Coca-Cola Co.

Powerade Ultra is a highly differentiated and scientifically enhanced sports drink aimed at delivering superior hydration, performance and recovery for modern athletes. Providing benefits for athletes who have longer and more intense workouts, this zero-sugar beverage is infused with creatine, branch amino acids, and B vitamins 1, 3, 6 and 12. The ingre-

The Coca-Cola Co. developed the AHA Sparkling Water line to appeal to current sparkling water customers, as well as to recruit new fans to the category by offering a unique, full-sensory flavor pairing. There are eight flavors offered, two with caffeine. The bold taste of the AHA Orange + Grapefruit Sparking Water was the top-rated by our panelists. All AHA Sparkling Water

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74 Convenience Store News C S N E W S . c o m


FEATURE

flavors contain no sweeteners, no sodium and no calories, and the drinks are naturally flavored. The colorful packaging was also a plus among our testers.

PACKAGED SWEET SNACKS:

Down Home Delights Chocolate Almond Coconut Dessert Bar, Prairie City Bakery

Down Home Delights premium dessert bars are the ultimate indulgent snacking experience for consumers seeking an on-the go comfort food treat. Individually wrapped, they are a perfect pick-me-up for the pandemic. Containing premium, high-quality ingredients with an SRP between $1.59 and $1.79, these bars provide a tremendous value to customers seeking indulgent treats. The simple thaw-and-sell format is easy to execute for store operators, requiring little to no labor, while boasting an impressive 30-day shelf life from thaw. They are moist and chewy. Available in three unique varieties — Oatmeal Carmelita, Apple Cinnamon Crumble, and Chocolate Almond Coconut — our panelists’ favorite was the Chocolate Almond Coconut bar, although all three varieties received high marks. SALTY SNACKS/MIXED:

Chex Mix MAX’D — Spicy Dill, General Mills

When they say MAX’D, they mean it. General Mills’ Chex Mix MAX’D delivers on its promise to shock consumers’ senses through both a texture and flavor intensity unlike any other snack. This is a new twist on an old tried-and true favorite. Individually packaged in a 4.25-ounce format, Chex Mix MAX’D is great for on-the-go consumption. Our panel was partial to the Spicy Dill pickle flavor-blasted snack mix.

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SALTY SNACKS/ NUTS & SEEDS:

Wonderful Pistachios No Shells Honey Roasted, The Wonderful Co.

Wonderful Pistachios No Shells Honey Roasted is an easy, no-mess plant-based snack that’s kissed with honey, sugar and a pinch of salt for a sweet and savory taste. Launched alongside Chili Roasted, it is one of two distinctive new flavors that allow Wonderful Pistachios to reach two contrasting categories of snacking fans: those seeking heat, and those who enjoy a sweet escape. No Shells flavors have proven to be incremental to the Wonderful Pistachios portfolio, with 38 percent of consumers purchasing No Shells flavors as their first-ever Wonderful Pistachios purchase, according to the company. One of our testers said: “Not cracking the shells? I’m in!” WINE:

Uptown Wine Cocktails — Chocolatini, Southern Champion

Uptown Wine Cocktails are premium, premixed cocktails in six fresh, bold flavors made with real fruit juices and natural ingredients. Each cocktail has a 13.9 percent ABV and is sold in a frosted, 1.5-liter glass bottle. Gluten free and kosher certified, with no high fructose corn syrup, the drinks fulfill consumer demand for great-tasting, ready-to-drink cocktails that can be purchased conveniently from the neighborhood c-store, saving customers time, money and an extra trip to a liquor or grocery store. Across all demographics, the Chocolatini was the highest rated by our testers. Comments included: “Goes down smooth,” “refreshing flavor” and “great value size.”


Beef Hot Dog

Smokey Cheddar Sausage

Ultimate Brat

Ultimate Jalapeño Cheddar Sausage

We’re an elite lineup featuring Ultimate Jalapeño Cheddar Sausage, Ultimate Brat, Smokey Cheddar Sausage, and our Beef Hot Dog. Ready and able to fill your entire roller grill, we’ll make it a craveable destination for your operation. No matter where people go, they always stop for Johnsonville. And with a variety of enticing products for any craving, it’s no wonder why. Give your customers the assurance of safety with a premium product and Johnsonville’s trusted name. Family owned since 1945 • Proudly made in the USA Hungry for more? See all of our delicious products, including our full range of roller grill flavors, at CStore.Johnsonville.com. © 2020 Johnsonville, LLC


FEATURE

OVERALL INNOVATION:

Fry Baby Clear, Anchor Packaging

This year’s pandemic-related lockdowns caused a shift to quick grab-and-go, delivery and curbside pickup. Fry Baby clear, hinged containers keep food hot and crispy and ready for on-the-go shoppers. No more soggy or cold fried foods. The 6-inch-by-3-inch package uses a patented, convection crossflow design to relieve moisture and condensation while maintaining food temperature. Through-theclosure ventilation, with raised airflow channels in the base of the container, combined with venting in the anti-fog lid, ensure fried foods remain hot and crispy even when packages are stacked in a bag. The unique design of this packaging retains internal temperatures and food texture for fried foods up to four hours in a hot display case and 30 minutes in transit. Packages will withstand temperatures up to 230 degrees. Our panelists compared Fry Baby clear containers holding fried chicken and fries to white plastic foam snap containers of similar size as well as a coated folding box, and this tested superior. CSN

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FOODSERVICE

Raising the Bar on Convenience Foodservice Alimentation Couche-Tard leads this year’s lineup of Foodservice Innovators Awards winners By Don Longo of craveable menu items to expanded private-label products, new bean-to-cup and soft-heat urn coffee systems, and a game-changing smoothie drink maker, the nation’s best-in-class convenience retailers continue to raise the bar on quality, service and innovation in the critically important foodservice category in the convenience channel. FROM THE INTRODUCTION

Alimentation Couche-Tard Inc., the multinational convenience retailer that operates under the Circle K banner in the United States, leads this year’s roster of five Convenience Store News Foodservice Innovators Awards honorees. Now in its ninth year, the Foodservice Innovators Awards program has been recognizing best-in-class convenience foodservice retailers since 2012. Winners are chosen annually by the CSNews Foodservice Advisory Council, a panel of foodservice experts from the retailer, supplier, wholesaler, research and consulting fields.

Foodservice Innovator of the Year: Circle K Circle K was applauded by judges for the successful rollout of its new “Fresh Food Fast” concept across North America and for its excellent coffee program. In March, President and CEO Brian Hannasch talked about how Couche-Tard was ramping up its new food program and rolling out a pilot program based heavily on Holiday Stationstores’ impressive food program. Couche-Tard acquired Minnesota-based Holiday in December 2017.

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Foodservice Innovator of the Year Circle K is rolling out its successful "Fresh Food Fast" concept across North America.

After initially rolling out the food program to different format stores in order to understand how to make it work broadly across its network, the global company is now excited about the program’s potential for customers and the related sales and traffic impact it will have on its stores. Holiday’s signature program included a large, diversified variety of food offerings from its exclusive Holiday Pantry sandwich and salad line. In dispensed beverages, Couche-Tard is growing its hot beverage business with the installation of coffeeon-demand machines across the U.S. The rollout is almost complete. In March, the company reported it had approximately 13,500 bean-to-cup machines installed, serving fresh coffee 24 hours a day. In cold dispensed beverages, Couche-Tard expanded its Polar Pop offering in Canada to an additional 110 stores and in frozen dispensed beverages, the retailer’s Froster program has


A FLAVORFUL SPARKLING WATER HAS ARRIVED

To learn more about this flavorful sparkling water, contact your Coca-Cola Representative, call 1-800-241-COKE or visit www.drinkaha.com.

©2020 The Coca-Cola Company


FOODSERVICE

Even prior to the pandemic, Prepared Foods Innovator of the Year Kwik Chek launched craveable meal kits for take-home dining.

been expanded to 140-plus sites in Europe. Circle K previously won Foodservice Innovators Awards as Hot Beverages Innovator of the Year in 2016 and Cold & Frozen Beverages Innovator of the Year in 2018. In addition, Holiday was named Prepared Foods Innovator of the Year in 2017, shortly after being acquired by Couche-Tard.

Prepared Foods Innovator of the Year: Kwik Chek Food Stores This marks the first time that Spicewood, Texas-based Kwik Chek Food Stores, operator of more than 45 convenience, grocery and quick food operations throughout Texas and Oklahoma, is being honored with a Foodservice Innovators Award. In selecting the chain as Prepared Foods Innovator of the Year, judges cited Kwik Chek’s focus on fresh, quality foods. Even before the onset of the COVID-19 pandemic, the retailer had the foresight to launch a program of craveable, innovative family meal deals that cost less than $20 and serve a family of four. Options include: • Chicken Family Deal — 10 tenders, two 16-ounce sides and four rolls for $15.99; • Taco Family Deal, Breakfast — Six original tacos for $8.99 or 12 for $13.99; and • Taco Family Deal, Lunch — Six original tacos and two 16-ounce sides for $13.99, or 12 tacos and two sides for $19.99.

felt the Family Meal Deals and expanded prepared foods offer are especially relevant in the current COVID-19 environment. Judges also liked Kwik Chek’s limited-time Value Meal Deal menu additions, such as the El Jefe Taco, Bandit, Seafood Plates, Nashville Hot Buffalo or BBQ Chicken Tenders on a Roll, fresh-baked velvet cookies, and hand-fried, fresh-made hash browns served with chopped onions.

Hot Beverages Innovator of the Year: 7-Eleven Inc. 7-Eleven scores its second win as Hot Beverages Innovator of the Year, having first won this category in 2018. The nation’s largest convenience store chain has also previously taken home honors as Cold & Frozen Beverages Innovator of the Year in 2014 and 2019, and for Best Limited-Time Offer in 2016. This spring, the operator of more than 9,000 stores in the U.S. launched a new dispensed beverage platform in its Long Island stores that allows customers to be their own barista. Touchscreen machines pour both custom hot and cold beverages to order. The platform includes espresso machines that can make lattes, espressos, cappuccinos, Americanos and more hot beverages that are customizable by size, by dark or medium espresso roasts, and with either whole or skim milk. Those in need of a jolt of energy can add a double espresso tap. At the same time, bean-to-cup brewers allow coffee fans to select the size, temperature and intensity of

The initial offering also included a Kings Ranch Casserole Family Deal, a Chicken Fried Steak Family Deal, a Hamburger Family Deal, and a Pizza Family Deal. Additionally, Kwik Chek has enhanced its grab-and-go section with Family Kwik Packs, which are prepackaged offerings of chicken salad, brisket, carne guisada, picadillo, pork tamales, mac and cheese, charro beans, mashed potatoes and green beans. Several judges

84 Convenience Store News C S N E W S . c o m

7-Eleven notches its second victory as the Hot Beverages Innovator of the Year.


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their coffee, with beans ground fresh for each cup. 7-Eleven continues to grow its portfolio of sustainable coffees, which now account for as much as half of its “green” coffee purchases. Since 2016, 7-Eleven has introduced Rainforest Alliance Certified coffees from El Salvador, Nicaragua, Mexico, Peru, Sumatra, Colombia, as well as an African blend from Ethiopia and Rwanda — all responsibly grown. Single-origin, 100-percent Colombian Rainforest Alliance Certified coffee is a permanent offering and top-seller on the hot beverage bar. Judges also cited 7-Eleven’s beverage innovation in the areas of new soft-heat urn systems and nitro-infused, draft cold-brew coffee and tea. “7-Eleven keeps improving its coffee program, technology, new products and the customer experience,” remarked one judge.

Judges called Kwik Trip's development of Fresh Blends a "game-changer" in the cold and frozen beverages category.

Servais, though, knew a self-serveoriented chain like Kwik Trip couldn’t launch a Starbucks style barista program just to add smoothies, and the self-serve technology he had in mind didn’t exist yet. So, he and his team solved the problem by partnering up with Welbilt Inc. and Beverage Innovations Inc. to create the Fresh Blends smoothie machine. Today, the Fresh Blends program provides a simple process for customers to use the machine’s touchscreen menu to select a drink category, flavor and cup size. Then, after placing the cup in the dispenser chamber, they stand back and watch as ice and smoothie ingredients are dispensed into the cup, the shuttle moves the cup into the blending chamber, and finally the shuttle returns the cup to the customer. As a Wi-Fi-connected device, the machines allow Kwik Trip to monitor performance and troubleshoot breakdowns of individual machines from the corporate office. The retailer can also monitor sales by location, review what is and isn’t doing well, and make changes accordingly.

Cold & Frozen Beverages Innovator of the Year: Kwik Trip Inc. Kwik Trip, based in La Crosse, Wis., is no stranger to the winners’ circle in the CSNews Foodservice Innovators Awards program. The retailer, which operates more than 560 c-stores in Minnesota, Iowa and Wisconsin, twice won the Foodservice Innovator of the Year honor in 2015 and 2019. This year, Kwik Trip is being honored specifically for beverage innovation. The retailer launched the Fresh Blends smoothie program after Foodservice Director Paul Servais was inspired by seeing Wisconsin customers ordering smoothies and frappes at a Starbucks at the height of winter. “I'm watching people go to Starbucks and get smoothies and frappes when it's that cold outside in Wisconsin," Servais recalled to CSNews last spring. "I'm thinking this is for real — we've got to do something with this."

86 Convenience Store News C S N E W S . c o m

Similar smoothie machines have been popping up across the country since Kwik Trip’s implementation. Judges lauded Kwik Trip as the catalyst behind the Fresh Blends program, and for its role in helping to develop the prototype. Said one judge: “I vetted this program and it’s truly impressive. KT’s commitment to a plug-and-play, high quality, easy to execute smoothie program should be recognized. An outstanding innovation for our industry that was driven by the experience, vision and wisdom of the Kwik Trip team.”

Foodservice Innovator to Watch: Enmarket Savannah, Ga.-based Enmarket, which operates 125 convenience stores, 14 quick-serve restaurants and a fast-casual restaurant, captures the Foodservice Innovator to Watch category this year. This award recognizes a c-store retailer as an “up-and-comer” that is making a name for itself with the quality and innovation of its foodservice program. Last year, Enmarket unveiled a beautiful 3,522-squarefoot store in the historic district of its hometown of Savannah. The one-of-a-kind store draws inspiration from the surrounding historic district and the site’s transportation-related history, given its proximity to the Central of Georgia Railway and Georgia State Railroad Museum. The newly renovated store features The Eatery, the chain’s proprietary kitchen concept, which serves antibiotic-free, never-frozen chicken, fried fish, and a host of daily specials and sides in the afternoon.


FOODSERVICE

Savannah, Ga.-based Enmarket is honored this year as the up-and-comer to watch for convenience foodservice innovation.

During the breakfast daypart, fresh pastries, grab-and-go biscuit and croissant sandwiches made in-house, and full plated breakfasts are available. The store also offers a full complement of dispensed beverages, such as bean-to-cup coffee, “Chillen” frozen drinks, fresh-brewed tea and cold brew coffee. Previously, this store did not offer prepared foods or dispensed beverages. In March of this year, Enmarket took the wraps off a 5,893-square-foot “Store of the Future” prototype, also located in Savannah. In this location, The Eatery provides foodservice offerings for every meal,

“It’s tough to compete in the same market as Parker’s, but Enmarket’s Eatery is doing just that,” said one judge. And another noted: “They brought in Ryan Krebs (as new foodservice director) and he did great things at Rutter’s.” Judges also cited that in the past two years, Enmarket has made changes in its store layout, focus on food and customer-driven culture. The company is one of the faster growing medium-sized chains in the industry, which will only elevate its reputation as it grows. All of the 2020 Foodservice Innovators Awards winners will be honored at CSNews’ Convenience Foodservice Exchange event, scheduled to be held Nov. 16-18 in Charlotte, N.C. CSN

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Revising the Roadmap More than half of c-store retailers saw foodservice sales decrease in the first half of 2020 By Angela Hanson

CONVENIENCE STORE foodservice programs have had a tumultuous 2020, with the COVID-19 pandemic affecting what food and beverages they can offer, how they can offer them, and how they can keep employees and customers safe while doing so. The pandemic has not only changed retailers' day-to-day operations, but it’s also had a significant effect on their expectations for the future, according to the 2020 Convenience Store News Foodservice Study.

New methods of ordering ahead, delivery and take-home options are on the agenda for many c-store retailers, with some also investing in new equipment and new food and beverage products. Large operators (more than 20 stores) are making more investments than small operators (one to 20 stores), but the foodservice category remains important across the board. COVID-19 is also disrupting the forecast for foodservice sales and profits, but not in a uniformly negative manner. While operating restrictions and changes in foot traffic have prompted many c-store operators to lower their expectations for category sales and profits this year, others say they have benefited from

competitive shakeups both within and outside the convenience channel.

What’s On the Menu Whether it's a proprietary program, a branded partnership or a commissary-supported grab-and-go offering, nearly all the c-store operators participating in this year’s Foodservice Study offer some kind of prepared food program, as well as hot and cold dispensed beverages. Frozen dispensed beverages are slightly less common, but more likely to be available at large operators. Prepared food remains the primary driver of the foodservice category, generating 47 percent of the category’s sales industrywide. Among small operators, prepared food accounts for more than half of the category’s sales (53 percent), compared to 38 percent at large operators. Within the prepared food segment, breakfast sandwiches lead as the top item offered industrywide, followed by snacks/appetizers, pizza, other sandwiches, hot dogs and bakery items. Some items are more likely to be available at large operators, particularly those that require special equipment such as cold-temperature display cases and roller grills.

Foodservice Segments Offered

Avg. % of foodservice sales derived from

% offering service

Total

Small Large Operators Operators

Total

Small Large Operators Operators

Prepared food (hot or cold, i.e., sandwiches, chicken, pizza, burgers, salads, soups, bakery, etc.)

92% 90%

95%

47% 53%

38%

Hot dispensed beverages (coffee, tea, etc.)

97% 97%

95%

25% 24%

26%

Cold dispensed beverages (fountain, etc.)

90% 87%

95%

27% 26%

28%

74% 66%

88%

12% 10%

14%

Frozen dispensed beverages (slush, etc.)

Note: Shading indicates a statistically significant difference at 95% confidence level S E P T E MB E R

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FOODSERVICE

Franchise/license branded foodservice concepts continue to have a sizeable presence in the convenience channel. Nearly one in three operators (29 percent) licenses or franchises a branded concept, with large operators more apt to do so than small operators (42 percent vs. 22 percent). Subway and Dunkin' are among the most reported branded concepts. In regard to dispensed beverages, hot coffee programs are virtually universal, offered by 95 percent of all c-stores. Fountain carbonated beverages, hot cappuccino/latte/ espresso and hot chocolate are offered by at least three-quarters of all retailers. Large operators are more likely to offer frozen drinks, iced tea, iced coffee, fountain sports drinks, and milkshakes. Although customization remains a popular consumer desire, made-to-order, barista-style beverages are still rare in the convenience retail space, available at just 11 percent of total stores (15 percent of large operators and 9 percent of small operators).

Responding to Changing Needs As part of their foodservice offer, large operators are more likely than small operators to currently offer in-store seating (46 percent vs. 39 percent, respectively), outdoor seating (32 percent vs. 22 percent) and third-party delivery (24 percent vs. 10 percent). Foodservice amenities currently offered at more comparable rates between large and small operators include take-home/ heat-and-eat dinner solutions (29 percent vs. 31 percent), drive-thru (12 percent vs. 10 percent) and meal kits (10 percent vs. 9 percent). In response to the coronavirus pandemic and recommended safety practices, consumers are making changes in how they purchase prepared food, which is in turn affecting retailers' plans for meeting their needs. One c-store operator reported wanting to offer “more choices for delivery." Another said they want to "add more branding, add more promos, add more food variety."

Foodservice Options: Currently Offer Total

Small Operators

Large Operators

90 Convenience Store News C S N E W S . c o m

76%

42% 39% 46%

In-store seating 31% 31% 29% 25% 22% 32%

Take-home/heat & eat dinner solutions Outdoor seating Third-party delivery

10%

15% 24%*

11% 10% 12% 9% 8% 12% 9% 9% 10% 6% 7% 5%

Drive-thru Catering Meal kits (cooking required at home) In-house delivery

Note: * indicates a statistically significant difference at 95% confidence level

Foodservice Options: Plan to Add Total

Small Operators

Large Operators 15% 16% 15%

Third-party delivery Take-home/heat & eat dinner solutions

7%

Outdoor seating

7%

Meal kits (cooking required at home)

3%

Drive-thru

3%

12% 5%

2%

7% 7%

0% 3% 3% 3% 3%

Catering

10% 15%*

4%

Microwave ovens for customer use

10% 8%

6% 6%

In-store seating

8%

7%

In-house delivery

5%

Note: * indicates a statistically significant difference at 95% confidence level

Foodservice Ordering: Currently Offer Total

Small Operators

Large Operators 39%

Order ahead by phone 29%

Contactless payment in-store

29%

Curbside pickup Order ahead via app Order ahead by computer

When asked which foodservice amenities they plan to add in the year ahead, the retailers overall said third-party delivery (15 percent plan to add), take-home/heat-andeat dinner solutions (8 percent) and outdoor seating (8 percent). Large operators are more interested than small operators in also adding meal kits and drive-thru service.

68% 64%

Microwave ovens for customer use

10% 9% 7%

In-store touchscreen ordering

7% 5%

At-pump touchscreen ordering

5% 7%

Pumpside pickup Order ahead by fax

2% 4% 5% 2% 2% 1% 2%

17% 14%

12%

10%

21% 23%

22%

34% 36%

44%


Foodservice Ordering: Plan to Add Total

Small Operators

Large Operators

24% 21%

Order ahead via app

29%

Curbside pickup

10%

27%*

14% 12% 20% 14% 10% 22% 14% 13% 17%

Order ahead by computer Pumpside pickup Contactless payment in-store At-pump touchscreen ordering

16%

12%

7%

22%* 11% 10% 12%

In-store touchscreen ordering Order ahead by phone

4%

Order ahead by fax

5% 4%

When it comes time for customers to pick up and pay for their orders, 34 percent of all c-stores currently offer some form of contactless payment in-store, while 21 percent offer curbside pickup.

8% 15%* 7%

Note: * indicates a statistically significant difference at 95% confidence level

Actual 2020 Foodservice Sales (January-June) Total

Small Operators

Large Operators

63%

53%

36% 36%

47% 12%

17*%

34%

2%

Decreased

Stayed the Same

Increased

Note: * indicates a statistically significant difference at 95% confidence level

Expected Full-Year 2020 Foodservice Sales Total

Small Operators

Large Operators

44% 28% 26%

32%

Decrease

28%

29%

42%

27%

Stay the Same

Small Operators

51%

Increase

Large Operators

59% 47%

27% 22%

27% 27%

26% 15%

Decreased

Stayed the Same

The increased demand for takeout food during the pandemic, however, is prompting more c-store retailers of all sizes to consider updating their ordering and payment options. Nearly a quarter intend to add ordering ahead via app within the next year. This figure is closer to one-third among large operators, who also indicate a higher likelihood of adding curbside pickup, pumpside pickup, at-pump touchscreen ordering, and order ahead by computer. While the majority of small operators are making plans to meet consumers' changing needs, 29 percent of these retailers did say that they do not plan to add any new ordering options in the year ahead. This compares to just 15 percent of large operators who said the same.

Reworking the Forecast

46%

Actual 2020 Foodservice Profits (January-June) Total

Given the current environment, another amenity growing in importance in the c-store space — and the foodservice industry overall — is the ability to order ahead. Currently, order ahead by phone is the most common method offered, available at 39 percent of all c-stores. Large operators are more likely to offer technology-based services such as order ahead via app, order ahead by computer, and in-store touchscreen ordering.

Increased

Overall, c-store foodservice sales took a significant hit during the first half of 2020. More than half of the operators participating in this year’s Foodservice Study (53 percent) reported their foodservice sales decreased, while 36 percent saw sales increase and 12 percent reported no change. Large operators struggled more, with 63 percent reporting their foodservice sales decreased from January through June, compared to 47 percent of small operators. Many say that a drop in foot traffic is their primary obstacle, while others report that pandemicrelated cost increases are having a net negative effect despite them seeing steady traffic. "I was positioned for an increase, but because of what has happened with COVID-19, I will be happy to be even," one retailer remarked.

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FOODSERVICE

When asked to forecast for full-year 2020, 44 percent expect to end the year with increased foodservice sales, while 28 percent expect sales to decrease and 28 percent expect their foodservice sales to stay the same. Small operators are slightly more bullish than their larger counterparts with 46 percent projecting an increase vs. 42 percent of large operators. In terms of dayparts, breakfast and lunch saw the biggest sales growth in 2019, according to retailers, and these dayparts are also expected to generate the most growth in 2020. However, while just 3 percent of retailers cited the dinner daypart as having the biggest sales growth last year, 10 percent predict it will see the most growth this year. Unsurprisingly, foodservice profits have suffered alongside sales. For January through June, 51 percent of retailers reported a decline in foodservice profits, while 27 percent saw their profits rise and 22 percent saw no change. As with sales, the impact of COVID-19 on profit was not uniform across the industry. While the same percentage of large and small operators reported increased foodservice profits (27 percent), more large operators reported a decline — 59 percent of large operators, compared to 47 percent of small operators. Looking ahead to full-year 2020, 44 percent of all operators expect to end the year with increased foodservice profits, while 33 percent expect a decrease and 23 percent expect no change. Unlike with sales, large operators are more bullish when it comes to profits, with 46 percent projecting an increase vs. 43 percent of small operators. Despite COVID-19's overall negative impact on the foodservice industry, some c-store retailers are surprisingly optimistic about full-year sales and profits. In some cases, lockdowns prompted competing restaurants to close or be less accessible to diners, while other retailers say their numbers suffered earlier in the year but have been on an upswing since regions began reopening.

Expected Full-Year 2020 Foodservice Profits Total

Small Operators

33%

Large Operators

37%

23%

Decrease

92 Convenience Store News C S N E W S . c o m

43%

26% 17%

Stay the Same

Increase

In terms of dayparts, breakfast and lunch saw the biggest sales growth in 2019, according to retailers. 2019 Sales Growth by Daypart Total

Small Operators

Large Operators 29% 27% 32%

Breakfast Morning snack

3% 5% 0% 23% 21% 27%

Lunch Afternoon snack Dinner Evening snack Late night

6% 8% 2% 3% 3% 5% 1% 1% 0% 3% 1% 7% 31% 34%

Don't know

27%

2020 Predicted Growth by Daypart Total

Small Operators

Large Operators 20% 20% 22%

Breakfast Morning snack

5%

7% 10% 22% 22% 22%

Lunch Afternoon snack 0%

3% 4%

Dinner

8%

10% 15%

Evening snack 0%

"People are coming to convenience stores more because they want to get out of the house, but don't really have anywhere else to go," one retailer commented. "We are a one-stop shop." CSN

46%

44%

31%

Late night

3% 4% 3% 4%

2%

32% 34%

Don't know 29%


FOODSERVICE

FOOD I NSIGHT P O W E R E D B Y DATA S S E N T I A L

Innovation Is Still Key to LTO Success Despite pandemic, excitement for the latest food and beverage trends has not slowed THIS PANDEMIC MAY have hit the pause button on a lot of things, but consumers’ excitement for the latest food and beverage trends did not slow down. In fact, according to Datassential COVID-19 research, the majority of consumers are still interested in key pre-pandemic macrotrends like simple ingredients, plant based and functional foods.

While it may come as no surprise that betterfor-you trends continue to be paramount as consumers face a new set of health and wellness concerns, food is also emotional medicine. More than a fourth of consumers are eating more comfort foods than they were pre-pandemic. Since COVID-19 appears to be here for the foreseeable future, we can expect a continued focus on better-for-you and reinvented nostalgic comfort foods. Better to Be Better-for-You QuickChek recently launched a mango smoothie and a strawberry smoothie, both 100 percent natural, made with real fruit, and available in both dairy and non-dairy options, playing into plant-based trends. Both smoothies earned outstanding purchase intent ratings with consumers. On the more innovative side, Stewart’s Shops took a better-for-you approach with its Mango Dragon Fruit Sherbet to shore up its alreadystrong frozen treat line. Combining the more familiar mango with the trendy dragon fruit, both pack a nutritional punch along with providing great flavor. Nostalgic Comfort Wins A few recent summer barbecue-inspired limited-time offers (LTOs) have brought a new twist to classic dishes — and generated outstanding uniqueness ratings. Royal Farms launched a Tennessee Smoke & Whiskey Pulled Chicken Sandwich with a unique smoky whiskey sauce, while Pilot travel centers introduced a BBQ Brisket Pizza, a reinvented comfort food by combining two comfort classics: barbecue and pizza. On the sweeter side, Maverik recently launched four nostalgic s’mores-inspired LTOs — a brownie, a cookie, a doughnut, and a muffin. The muffin and brownie ranked highest in branded purchase intent, while the muffin and doughnut rated highest in uniqueness. CSN

79

51%

definitely or probably would buy

unbranded PI

89

95

86

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

95

68%

definitely or probably would buy

branded PI

--

--

95

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

27

31%

extremely or very unique

uniqueness

41

33

25

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

90

23%

would order the item all the time

frequency

92

81

93

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

76

46%

would visit somewhere just for this item

draw

89

79

91

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

63

41%

excellent or good value for the dollar

value

22

57

21

versus other c-stores’ items

versus other non-alcoholic beverages

versus other items from QuickChek

Datassential’s coronavirus research takes an exhaustive look at industry topics impacted by the COVID-19 crisis. For free access to all of its coronavirus reports and resources, visit Datassential’s COVID-19 page at datassential.com/coronavirus.

S E P T E MB E R

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TOBACCO

Due Date After delays and court challenges, the clock strikes midnight on the deadline for premarket tobacco product applications By Melissa Kress CLOSE TO A DECADE after electronic cigarettes burst onto the scene, federal regulators are preparing to give a thumbs up or thumbs down to e-cigarettes and vapor products — known collectively as electronic nicotine delivery systems (ENDS) — remaining on the backbar.

Ahead of Schedule

Sept. 9, the day the vapor industry has had circled on the calendar for months, marks the last day companies can file premarket tobacco product applications (PMTAs) for ENDS, among other products included in the Food and Drug Administration’s (FDA) 2016 deeming rule, which granted the agency the authority to regulate all tobacco products.

“This milestone represents an important step forward for EAS as we support our mission of producing high-quality vapor products that serve as an alternative to combustible cigarettes,” said Jacopo D’Alessandris, president and CEO of Darien, Conn.-based EAS. “FDA Acceptance and Filing Letters are a testament to the strength and thoroughness of our applications, which we believe will meet FDA’s requirements.”

The deadline comes after setbacks, delays and court challenges. On July 12, 2019, in what appeared at the time to be the final ruling, District Judge Paul Grimm of the U.S. District Court for the District of Maryland set a May 12, 2020 deadline for companies to submit their PMTA applications to the FDA. However, this spring, Grimm agreed to extend the deadline to Sept. 9 as tobacco companies and the FDA weather the challenges of the COVID-19 pandemic. The due date is either a boon or a bust, depending on how you look at it. For companies that filed applications, the deadline marks the beginning of the review process that will, hopefully, give them the greenlight to remain on the market. For those companies that did not meet the deadline or chose to not submit an application, it marks the end of their run. Filing an application with the agency allows the products to remain on the market after the PMTA deadline until the FDA completes its review and issues a final decision. In theory, Sept. 9 is critical because it will weed out any bad apples, so to speak, according to Chris Howard, vice president, general counsel and chief compliance officer at E-Alternative Solutions (EAS), whose portfolio includes Leap and Leap Go vapor products. The FDA, though, will still need to do its part and “actively enforce against those products that don’t exit the market,” he pointed out. “There is a reason we spent the time and the money to support our PMTAs — and we are not alone. There are many companies that are spending the money and putting the time into the PMTA process, and that is to get to a controlled environment where the marketing doesn’t get out of hand and where the kids aren’t drawn to the products,” Howard explained. He views Sept. 9 and the subsequent enforcement by the FDA as a critical part of getting there. “The faster FDA prioritizes enforcement and collaborating with PMTA applicants, the better. I believe the future for vapor is bright,” Howard said. “It will just take a little time to get there and we are in the middle of the journey right now.” 94 Convenience Store News C S N E W S . c o m

EAS submitted PMTAs for its Leap and Leap Go products, and the agency accepted those filings in early July, moving the applications to the substantive review phase of the PMTA process.

Acceptance letters follow the agency’s administrative review of filings to ensure that the submissions meet the baseline criteria for review. Filing letters are the result of a preliminary scientific review that ensures that applications include the necessary ingredients and health analyses. “The substantive review is where our months of hard work assembling more than 100,000 pages of evidence will pay off in supporting our proposition that the Leap and Leap Go products are appropriate for the protection of public health,” Howard said. “We are looking forward to continued collaboration with FDA in the weeks and months to come and remain optimistic that the PMTA process will result in marketing orders.”

On File Even before the deadline was officially extended due to the coronavirus pandemic, Reynolds American Inc. submitted two PMTAs in mid-April. The Winston-Salem, N.C.-based company is seeking FDA marketing orders for its Vuse Vibe and Vuse Ciro vapor products. The filings include multiple flavor variants for each brand style. The applications submitted by the company to the agency include a range of scientific studies for Vuse Vibe and Vuse Ciro using well-known methodologies, including the comparative assessment of cigarettes and associated health risks. “I am incredibly proud of our diverse team of scientists, researchers and regulatory experts who have worked tirelessly together to complete these applications well ahead of the FDA’s May deadline for ENDS products,” said James Figlar, Reynolds’ executive vice president and head of scientific and regulatory affairs. “We are optimistic that we will receive a favorable marketing order for all of our applications, which would enable us to provide adult tobacco consumers with multiple acceptable alternatives to cigarettes, and we’re hopeful that as PMTAs move forward, the agency prioritizes enforcement against illegally marketed tobacco products introduced after Aug. 8, 2016.”


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The PMTAs for Vuse Vibe and Vuse Ciro are actually the second and third complete grouped PMTA applications submitted by Reynolds to the FDA for review. The company filed PMTA applications for Vuse Solo in October 2019.

products manufactured by Helix Innovations LLC, an Altria joint venture responsible for the global on! nicotine pouch product portfolio. To support these applications, Richmond, Va.-based Altria submitted more than 66,000 pages of documentation, including six primary studies.

In late April, Fontem US LLC submitted PMTAs to the agency seeking authorization to continue marketing a range of its myblu electronic vaping products. Its submissions include data from a comprehensive range of laboratory and clinical scientific studies, including product analyses, behavioral data, nonclinical health risk information, and information on the impact to both users and non-users of tobacco products.

“We believe the scientific evidence in these applications demonstrates that the marketing of on! is appropriate for the protection of public health,” said Paige Magness, senior vice president, regulatory affairs, for Altria Client Services. “On! nicotine pouches are a key part of our vision to responsibly lead the transition of adult smokers to a non-combustible future.”

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“We agree that the electronic vaping industry should be held to the highest product and marketing standards, while providing adult smokers with alternative products that could serve the interest of the public health,” said Antoine Blonde, president of the Greensboro, N.C.-based company. “Fontem US looks forward to working with the FDA as the agency develops and enforces an evidence-based regulatory policy.”

The nicotine pouches, which are tobacco leaf-free, are available in seven flavors and five nicotine levels. They were distributed in more than 28,000 stores as of the end of the first quarter of 2020, including the top five convenience store chains by volume. Among other notable submissions, JUUL Labs, which counts Altria as a stakeholder, filed its JUUL System for the PMTA process. Its submission includes comprehensive scientific evidence for the JUUL Device and JUUL Pods in Virginia Tobacco and menthol flavors at nicotine concentrations of 5 percent and 3 percent, as well as information on its datadriven measures to address underage use of its products.

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In early June, Altria Group Inc. received word that the FDA accepted and filed for substantive review (the second phase of the process) the company’s PMTAs for 35 on!

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WE ALSO HAVE The application includes detailed scientific data from more than 110 studies, totaling more than 125,000 pages evaluating the product’s impact on both current users of tobacco products and non-users, including those who are underage, according to the San Francisco-based company. The research is supplemented with information on the controlled design and repeatable manufacturing processes associated with the JUUL System, as well as data-driven measures to limit unintended consequences to the overall population, including initiation among non-users.

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“In order to earn a license to operate in society, we need to be a science- and evidence-based company, engage in open and transparent dialogue with our stakeholders, and take methodical and responsible actions to advance the potential for harm reduction for adult smokers, while combating underage use. Our PMTA submission is a key part of that approach,” said JUUL Labs CEO K.C. Crosthwaite. CSN

The Long & Windy Road APRIL 2011: The Food and Drug Administration (FDA) announces it will regulate electronic cigarettes under the 2009 Family Smoking Prevention and Tobacco Control Act. MAY 2016: The agency publishes its finalized deeming rule, extending its authority to all tobacco products, including electronic cigarettes and vapor products — known collectively as electronic nicotine delivery systems (ENDS). AUGUST 2016: The deeming rule goes into effect, allowing 24 months for companies to file premarket tobacco product applications (PMTA) for newly deemed products. JULY 2017: The FDA revises its timeline for PMTAs for non-combustible products, such as e-cigarettes and vapor products, to Aug. 8, 2022. MARCH 2018: Several public health and medical groups sue the FDA to expedite the agency’s review of tobacco products. MAY 2019: U.S. District Judge Paul W. Grimm orders the FDA to begin reviewing all e-cigarette and vapor products in the U.S. market. JUNE 2019: Grimm sets a May 12, 2020 deadline for companies to submit PMTAs to the agency. MARCH 2020: The FDA asks the court to delay the PMTA deadline for ENDS as the COVID-19 pandemic spreads across the United States. APRIL 2020: Grimm agrees to extend the PMTA deadline for ENDS to Sept. 9, 2020.

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Health & Wellness on the Backbar Wawa makes the decision to enter the smoking cessation category By Linda Lisanti WAWA INC. KNOWS that its customers are always changing and so, the convenience store retailer wants to make sure that its offer both in-store and at the forecourt always reflects that.

With this in mind, the Wawa, Pa.-based operator of more than 850 convenience retail stores recently decided to enter the smoking cessation category, for the first time in its history. Wawa has formed a partnership with GSK Consumer Healthcare to offer its Nicorette products at all Wawa stores — becoming the first major c-store retailer to launch Nicorette chainwide. “Over the last several years, people have started to change habits and become much more conscious and educated about their health and wellness. Our in-store offer, both in foodservice and packaged goods, reflects this trend and we wanted to make sure that we have a complete offer in the tobacco space as well,” said William Kloss, Wawa’s category manager for tobacco and snacks.

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Research shows that two-thirds of smokers are considering quitting over the next year. Since roughly 90 percent of all cigarettes are purchased at convenience stores, it seems like “a great opportunity” to establish a Nicorette presence in the convenience retail channel, according to Susan Miller, customer strategy manager, Nicorette, for GSK Consumer Healthcare.

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“Nicorette has been helping millions of Americans quit smoking for over 35 years, and we are now offering convenience store shoppers a smaller, 10-count size that allows them to give quitting a try at a price that is typically less than a pack of cigarettes,” Miller explained. “With the launch of the smaller size 10-count Nicorette gum and the new 20-count Nicorette Coated Lozenges, we are excited to partner with Wawa and hopefully entice more smokers to begin their journey to stop smoking with Nicorette.” Wawa’s stores are spread across Pennsylvania, New Jersey, Delaware, Maryland, Virginia, Florida and Washington, D.C. At most of its locations, Kloss said Nicorette is merchandised on the tobacco fixture in its innovation section, close to e-cigarettes. In the chain’s smaller-format stores, the product is usually merchandised under the counter. To support the launch, Wawa has “a very robust marketing program” in place that includes coupons for Wawa Rewards members, virtual ads and signage throughout the store, noted Kloss. “Our goal is to let customers know that we are in the smoking cessation category and offer a strong assortment of the Nicorette products,” he said. “We will also have a full promotional calendar on Nicorette products to bring value to our customers and build brand awareness.” As health and wellness trends continue to grow across all segments of the American population, GSK believes the smoking cessation category is poised to grow in the convenience channel. Miller is confident that the success of the Wawa launch will lead to even more opportunities for Nicorette to expand its c-store footprint and provide access to millions of smokers. “Providing smoking cessation solutions where the majority of tobacco products are sold makes sense from a corporate responsibility perspective,” she said. CSN

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Grocery’s Star Power The change in shopping habits amid COVID-19 is illuminating a c-store opportunity By Renée M. Covino SINCE THE CORONAVIRUS pandemic hit, the way consumers shop for groceries has rapidly evolved. While this has meant sweeping operational changes in the grocery channel, the situation also has revealed opportunity for the convenience channel.

Consumers, worried about exposure to the virus and experiencing out-of-stock issues at supermarkets, mass merchants and club stores, have been increasingly leaning on the online and value-store channels to meet many of their grocery needs. The most significant change in grocery has been “the adoption of e-commerce as a primary channel,” said Chris Sarne, senior director of global retail strategy and solutions management at Oracle Retail. Many consumers have opted for online purchasing of groceries, with delivery direct to their homes or curbside pickup. From a traditional shopping perspective, consumers are making fewer trips to the grocery store, but their basket size is growing, on average, for those visits, Sarne noted. He believes the concern for safety is driving the trip frequency down, while the fear that favored merchandise will be in limited supply is driving up the desire to “stock up.” Furthermore, with economic pressures causing consumers to worry about stretching their dollars, there’s an uptick happening in private-label sales within mainstream grocery chains, as well as a migration to lowercost grocery retailers such as Aldi and Lidl. “At the height of the pandemic, consumers shifted toward more brand-agnostic shopping behaviors, due in part to out-of-stocks and income constraints. While already well-positioned going into 2020, private brands witnessed significant growth during this time,” noted Nicole Peranick, senior director, Retail Transformation, at Daymon.

Oracle Retail’s hypothesis is that these behaviors will stay in place for the foreseeable future, given where the U.S. is currently in the lifecycle of the pandemic. In the early days of the pandemic, the value channel — particularly Dollar General — prevailed as an alternative brick-and-mortar destination for grocery items, according to Kimberly Senter, executive vice president of analytics, insights and intelligence for Advantage Sales, a part of Irvine, Calif.-based Advantage Solutions, which provides solutions to help retailers drive growth, profitability and loyalty. Since c-stores are not considered pantry-loading destinations, it was only natural that they weren’t heavily in the mix for the early pandemic grocery customer, Senter said. C-stores, in general, also were not well-positioned for meeting the demand that shifted to online ordering, or for leveraging store apps for pickup or delivery, she added. However, that has since changed. “In the last three months, we’re seeing the c-store channel make a comeback in overall food sales,” she reported. Senter highlighted that for the 13 weeks ended July 12, the average convenience store shopper spent $21.72 on general food items, compared to $33.14 for dollar/value store shoppers, $99.35 for online shoppers, and $259.75 for brick-and-mortar grocery store shoppers. Per trip, that breaks out to $5.49 for c-store shoppers (up 16.2 percent from the same time a year ago); $6.02 for dollar/value store shoppers (up 15.9 percent), $20.94 for online shoppers (up 3.2 percent), and $15.49 for grocery store shoppers (up 16 percent). The pandemic accelerated what was already a fastmoving trend toward order ahead for pickup across the grocery industry, observed Jaron Waldman, co-founder and CEO of Rakuten Ready, a leader in predictive arrival technology, which works with Kroger, Petco, Chick-fil-A and others to power their “mobile order for pickup” programs. A recent Rakuten Ready study found that orders made online for in-store or curbside pickup increased by more than 200 percent from March 2020 to May 2020. Along with the increased demand around order ahead for pickup, Rakuten Ready research also recently found that predictive arrival technology was chosen by 65 percent of consumers as the technology they would most like to see implemented by merchants. “Consumers are more concerned than ever about the amount of time they spend in stores and therefore, the speed of the pickup process is important to them,” Waldman said. “More and more customers are expecting their orders to be ready exactly when they arrive at the front of the store.” The challenge for grocers to meet online-order-for-pickup demand creates opportunity for convenience stores.

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AND OUR PIPE, TUBES, CIGARS “With grocers rethinking what ‘grocery shopping’ in the future looks like, I believe convenience stores should equally be reimagining,” he urged.

Convenient Solutions So, how can convenience stores make the most of the current situation and maximize their grocery category sales? Which merchandising and marketing techniques from other channels should they be following, or learning from?

FILTERED CIGARS

The way Oracle Retail’s Sarne sees it, the tendency to stockpile items and the popularity of certain categories (paper goods, hand sanitizer and cleaning products, for example) is putting a strain on inventory. “Convenience retailers must be prepared to source inventory from a broader group of suppliers if they want to stay ahead of demand, and they should prioritize inventory visibility to maintain optimal stock levels,” he advised. C-store operators should also keep in mind that recent shifts in consumer buying habits can have varying impacts on their margins. “As convenience stores are forced to buy inventory further ahead to avoid stockouts, they will have to carry inventory on their balance sheets for longer, potentially eating into profits,” Sarne said. “Separately, stockouts at grocery stores and supercenters may lead consumers to look elsewhere for items on their lists, presenting an opportunity for convenience stores to gain share.” As consumers are faced with navigating the economic and social aftermath of COVID-19, the private-brand value proposition will become even more essential in providing support for shoppers and their families, according to Daymon’s Peranick. “This presents greater opportunities for retailers in the convenience channel to lead with private brands in offering cost-effective and innovative solutions that address changing needs and provide inspiration to make the most of the new homebased lifestyle,” she said. While c-stores are not traditionally a destination for grocery shopping, Senter of Advantage Sales agrees that some locations may be able to capitalize on grocery items that are must-haves. “The addition of traditional grocery items can help offset lost snack sales from commuter decline,” she said. “And c-store operators would be wise to be prepared with some grocery items for their immediate community in times of need.” Cross-purchase opportunities that leverage foodservice in combination with grocery items could help drive incremental sales. For example, Senter said “a shopper should be able to easily order a meal for pickup and add a few incremental grocery items as needed for fill-in, all from their iPhone. The same should apply for at-home delivery.” In order for this to work, however, c-store operators must have the necessary technology integrated

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Be Tips for Being Mobile-Minded

To take advantage of the current situation and maximize grocery category sales, convenience stores must pay attention to the new consumer trends and demands within the space, according to Robert Rothschild, vice president and global head of marketing at Smartly.io, which helps brands across various industries get started and scale their social advertising. With more consumers spending time online, he believes it is important to utilize mobile creative campaigns, and offers up the following best practices: • Optimize for both in-store and online sales/conversions to maximize the total campaign impact. In-store merchandising strategies should not be put to bed, as convenience stores offer a quick and less crowded space to pick up groceries when consumers are looking to avoid big groups. • Display nearest store locations with map cards; include directions, business hours and other helpful information in the creative. This will be useful for consumers who need extra reminders that their neighborhood convenience store can provide the grocery items they need quickly. • Launch localized offers at-scale by targeting shoppers with customized messaging, local store inventory, local pricing and store conditions. • Promote products with high demand such as bestsellers, special offers and seasonal items. Remember to take regional variations into account. • Make sure to showcase the variety of grocery goods found in the store. Since convenience stores aren’t typically thought of as a grocery destination, consumers will be quick in their selection and won’t spend as much time in the store browsing. • Provide options to buy online or in-store. With little square footage available, it is important for convenience stores to provide online alternatives so that consumers feel they have a more “socially-distanced” option. • Tailor creative for mobile screens to maximize effectiveness. • Use radius targeting to reach shoppers close to your stores. • Consider immersive, full-screen mobile ad formats — such as Canvas Ads — to create digital versions of circulars.

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into their everyday business. “Having the ability to grow their shopper database and speak directly to their target customers are critical,” she said. “Cross-promoting, ordering options and delivery designation or pickup allow the consumer to better own and control their experience.” Convenience store retailers should certainly be thinking about their “contactless strategy” and how they can maximize an order-for-pickup experience, via websites or apps, according to Rakuten Ready’s Waldman. With predictive arrival technology built into their online ordering capabilities, forward-thinking c-store operators will be able to understand exactly when customers will arrive and can plan to execute seamless order handoff in the safest contactless manner possible, he explained. To maximize sales, retailers in both the grocery and convenience channels are starting to move beyond traditional data analytics and applying machine learning to get counterintuitive and previously unseen insights that help them respond to business trends in near real-time, according to Tom Litchford, global head of retail and wholesale trade for Amazon Web Services. “The category management process must transform to embed even more real-time insights and predictive analytics that help adjust product mix based on trends and supplier conditions, optimized or adjusted inventory levels, pricing, and promotional offerings,” Litchford told Convenience Store News. For example, during the onset of the pandemic, retailers nationwide saw product shortages as consumers rushed to stock up on items like paper towels, toilet paper and sanitizers. As the supply chain begins to recalibrate, it’s imperative for retailers to now get “better insights for SKU rationalization, as well as demand forecasting and allocation,” he said.

Shaping the Future Even in a post-pandemic world, experts predict that consumers will hesitate to return to stores and shop in the ways they once did. “We’re already seeing grocers like Kroger test dark stores and stand-up locations that are 100 percent dedicated to fulfillment and online orders for pickup; this will continue to be a viable channel with lots of future testing,” said Waldman. “The grocers that will win consumers’ wallets will be the ones who can offer these services — pandemic or not — in a safe and timely fashion, every single time.” Investments in online ordering and frictionless shopping solutions were growing pre-COVID-19, but they are now accelerating as online ordering has become a consumer expectation, points out Mike Stern, senior vice president of sales, small format, at Advantage Sales. Many convenience store operators are expanding their mobile ordering capabilities. “An example is Casey’s [General Stores], which has expanded both foodservice and grocery assortment available via their e-commerce platform,” Stern cited.

Advantage Sales is also seeing more c-store operators build up their capabilities in frictionless shopping. Stern pointed to Wawa testing a drive-thru-only store. C-store operators would be wise to partner with services such as Grubhub, Instacart and DoorDash to “start aligning with future needs of the current generation,” Senter advised. She said limited initial investments could give retailers the opportunity to leverage the results and grow in certain markets, vs. taking a riskier all-in approach. COVID-19 has forever altered the grocery shopping experience, summarized Litchford of Amazon Web Services. “Digital ordering and choice in fulfillment are no longer niche offerings; they will emerge as table stakes to attract customers who want maximum flexibility and more personalization from their grocery shopping experiences,” he said. CSN

How Will Grocery Shopping Evolve Post COVID-19? According to industry experts, these are the most likely scenarios: • Frictionless shopping, meaning the minimizing of touchpoints, will be more relevant than ever. • Retailer partnerships with third-party companies like Grubhub, Instacart, DoorDash and Postmates will be a lot more popular. • The ability to generate fill-in purchases will be key for any retailer in the grocery category. • Personalized and targeted promotions and bundles will be an expectation among consumers. Loyalty programs that enable such efforts will also be critical. • Voice ordering, also tied to loyalty programs, will be more commonplace. • Online ordering for delivery or curbside pickup will be used by many shoppers exclusively, or in combination with in-person shopping trips. • “Dark stores” and stand-up locations that are 100 percent dedicated to fulfillment and online orders for pickup will be offered by major retailers. • Drive-thru-only stores will be in a serious testing phase. • Cleanliness and consumer safety will be paramount to consumer trust; a retailer’s investment in — and communication of — sanitation will be critical. • Private-label brand momentum will continue postCOVID-19. S ESPETPETME BMEBRE R 2 022002 0Convenience Convenience Store Store News News 1 0 3 103


TECHNOLOGY

Meeting New Customer Needs Through Technology Tech spending continues to rise as pandemic speeds implementation of contactless technology, home delivery and curbside pickup By Don Longo

at the pump, developing greater business intelligence capabilities and improving store-level inventory management are the top three business opportunities that will drive convenience store retailers' technology investments in the coming year, according to the findings of the 2020 Convenience Store News Technology Study. BECOMING EMV COMPLIANT

Becoming EMV compliant at the forecourt was named as the single highest priority by 20 percent of respondents. Also high on the list of drivers are reducing theft and shrink, increasing customer payment options, and replacing aging point-of-sale technology. A third of the convenience store IT executives surveyed this year said the COVID-19 pandemic has sped up the implementation of new contactless technology, home delivery and curbside pickup programs. In addition, more than a quarter of respondents said the pandemic has sparked their interest in exploring these initiatives in the near future. This year’s Technology Study examined convenience retailers’ 2019 technology spending and their 2020 investment plans, especially in light of the impact the coronavirus pandemic is having on consumer behaviors and store operations.

Top 10 Opportunities Driving Technology Investment in the Coming Year 1 Become EMV compliant at the pump 2 Develop greater business intelligence and reporting capabilities 3 Better management of store-level inventory/revenue 4 Reduce theft/shrink 5 Increase customer payment options 6 Replace aging POS technology 7 Employee training 8 Better management of store labor expense 9 Improve data security 10 Frictionless/self-checkout technology Source: 2020 Convenience Store News Technology Study

Last year, nearly a third of retailers increased their tech budgets by 10 percent or more; up from a quarter that did so the previous year. This year, in a positive sign that c-store retailers are investing to meet current and future challenges, nearly three-quarters of respondents said they will spend more on technology and automation in

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TECHNOLOGY

2020 than they did in 2019; that's up from 57 percent who said the same a year ago. Respondents spent an average per company of $1.578 million on technology last year, a 5 percent increase from the previous year. The median amount spent per company in 2019 was $280,000, up from $225,000 the previous year. Investment has been shifting slightly from capital expenditures (which accounted for 58 percent of 2019 tech spending, down from 61 percent the previous year) to other types of spending. Sixty-one percent of 2019 spending went to replacing old/outdated systems and equipment vs. adding new equipment. Looking at the breakdown of spending between headquarters and store-level technology, this year’s study shows that approximately 61 percent of spending went to the store level last year. In addition, retailers said their 2019 technology spending was split fairly even between consumerfacing tech and employee-facing tech.

The Reaction to COVID-19 With the pandemic keeping customers at home, it’s no surprise that a third of c-store retailers are currently offering home delivery, while 22 percent said they plan to offer home delivery in the near future. Less than 10 percent handle delivery with their own employees. The most popular third-party delivery services used by c-store retailers are DoorDash and Grubhub (used about equally), followed by Postmates, and then Uber Eats. More than 30 percent of c-store retailers said they are currently offering product ordering via an app, and more than 40 percent said they plan to offer in-app ordering in the near future.

2020

Impact of the COVID-19 Pandemic on Technology Development Sped up implementation of new contactless technology, delivery & curbside pickup options

33.3%

Sparked our interest in exploring contactless technology, delivery & curbside pickup options for the future

Sped up expansion and/or enhancement of existing contactless technology, delivery & curbside pickup options

20%

20% None of the above

26.7%

Change in Technology Budget: 2019 vs. 2018

25.6% Increased 10% or more

No change

31.5%

18%

Increased 5% to 9%

24.9%

Increased 0.1% to 4.9%

Note: Technology budget includes hardware, software, cloud subscription fees, IT staff, store-level IT, service contracts, consulting, etc.

Technology Spending Plan for Full-Year 2020

Will spend the same

Will spend less than in 2019

21.0%

73.7%

Will spend more than in 2019

5.3%

Most convenience retailers offer in-store pickup for online or app-generated orders, Does your company currently offer but 52 percent also offer curbside pickup, and 20 percent offer pickup at the gas pump. delivery to customers?

EMV at the Pump Although the deadline for shifting EMV liability at the pump was pushed back to April 2021, more than half of the c-store retailers surveyed this year are still not prepared for the change. Inside the store, more than nine out of 10 retailers said they are EMV compliant; however, just 45 percent of those surveyed said they are compliant at the pump. Nevertheless, this appears to be a cost of business not to be avoided, as 85 percent

106 Convenience Store News C S N E W S . c o m

Yes, we currently offer delivery

34.8%

No, we don't currently offer and have no 43.5% plans to add delivery

21.7%

Source: 2020 Convenience Store News Technology Study

No, but we plan to offer delivery in the future


TECHNOLOGY 2020

of the retailers surveyed expect to reach compliance by the new April 2021 deadline.

How is customer delivery executed?

Promotional/Sales Technologies The most popular forms of promotional/ sales technology being used by retailers in the convenience channel today are social media, websites and mobile apps — all of which are utilized by 60 percent or more of c-store retailers. In-store digital monitors and text messaging to consumers, meanwhile, are used by more than half of all respondents. The percentage of retailers that have incorporated social media into their marketing plans increased to 87 percent this year, up from 81 percent a year ago. Retailers almost universally use Facebook (98 percent), followed by Instagram (62 percent), Twitter (55 percent), and the GPS navigation app Waze (34 percent). Retailers indicate that they use social media to publicize promotions (95 percent), events (81 percent), community service initiatives (76 percent), contests (62 percent) and new vendor products (57 percent); as well as for polling consumers (53 percent).

DoorDash

56.3%

Grubhub

56.3%

Postmates

25.0%

Uber Eats

18.8%

Own employees

6.3%

Is your company EMV-compliant?

AT THE POS

Yes

91.3% 45.2%

No, but we have started the process 8.7% 42.4% No, and we have not started yet

0.0% 12.4%

Do you expect to reach forecourt compliance by the new April 2021 deadline? Yes

85.0%

No

15.0%

Note: Includes companies that are not yet EMV-compliant at the pump

Does your company offer a loyalty program?

Looking toward the future, GPS alerts, digital loyalty programs and email marketing are all in the promotional/sales technology plans for 30 percent or more of c-store retailers.

AT THE PUMP

CURRENT

YEAR AGO

Yes

50.0% 50.3%

No

50.0% 49.7%

Involvement in Promotional/Sales Technologies Any listed promotional sales/technology

IMPLEMENTED

PLAN TO ADD

83.7%

67.4%

GENERAL: Social media

79.1%

9.3%

Consumer-facing website

76.7%

11.6%

Mobile app

60.5%

25.6%

Digital monitors in-store

53.5%

11.6%

Text messaging to customers

51.2%

23.3%

Digital loyalty program

48.8%

32.6%

Data analytics platform

48.8%

23.3%

Email marketing

46.5%

30.2%

GPS/geolocation alerts

39.5%

34.9%

CRM software

30.2%

18.6%

Digital monitors at the pump

34.9%

16.3%

Advertising/couponing at the pump

32.6%

16.3%

Merchandise ordering at the pump

20.9%

16.3%

FORECOURT:

Source: 2020 Convenience Store News Technology Study

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TECHNOLOGY 2020

Loyalty Programs Half of respondents offer consumers a loyalty program, the same percentage as a year ago. However, this year, threequarters report that their loyalty program is proprietary, not tied to a major oil brand, compared with just half of respondents a year ago. Programs tied to a major oil brand declined from 33 percent last year to 17 percent this year.

Description of Loyalty Program

Mobile ordering for pickup also was cited by 67 percent of respondents as a top

Payment Options Offered

YEAR AGO

Point/reward-based

51.9% 58.4%

Credit card/payment option

4.2% 8.3%

Both

43.9% 33.3%

Type of Loyalty Program

Of the loyalty programs offered, 36 percent are tied to a mobile app and 18 percent are tied to a physical card. Nearly half, though, offer members both a mobile app and a physical card. The percentage of retailers with a mobile app for consumers increased to 58 percent this year, up from 49 percent last year. The most popular c-store app features are a store locator, proprietary product coupons, limited-time specials, fuel prices and vendor coupons — each of these is offered by 66 percent or more of respondents.

CURRENT

CURRENT

YEAR AGO

Proprietary

75.0% 50.0%

Tied to a major oil brand

16.7% 33.3%

Both

8.3% 16.7%

Card or App-Based Loyalty Program

CURRENT

YEAR AGO

Mobile app

36.4% n/a

Physical card

18.2% n/a

Both

45.4% n/a

Does your company have a mobile app available to consumers? CURRENT YEAR AGO Yes

57.8% 48.5%

No

42.2% 51.5% IMPLEMENTED

PLAN TO ADD

100.0%

0.0%

Third-party mobile payment (Apple Pay, Samsung Pay, PayPal, etc.)

72.8%

16.3%

Prepaid/stored value card (not including prepaid phone cards)

68.7%

16.1%

IN-STORE: Credit/debit

Electronic benefits transfer (EBT)

68.1%

17.1%

Electronic check verification

52.3%

10.3%

RFID

47.8%

17.2%

Frictionless self-checkout using kiosk

31.8%

18.2%

Proprietary mobile payment in app

27.3%

50.0%

Frictionless self-checkout using app

18.2%

31.8%

Frictionless self-checkout using AI/sensors

4.5%

22.7%

Biometric payment technology

3.4%

24.7%

100.0%

0.0%

AT FORECOURT: Credit/debit Prepaid/stored value card (not including prepaid phone cards)

53.8%

13.3%

Partial debit authorization

45.9%

10.6%

Third-party mobile payment (Apple Pay, Samsung Pay, PayPal, etc.)

44.7%

20.2%

Electronic check verification

40.2%

8.8%

Electronic benefits transfer (EBT)

38.1%

4.5%

Proprietary mobile payment in app

38.1%

40.9%

RFID

21.2%

10.9%

Cash acceptors

17.2%

16.7%

Source: 2020 Convenience Store News Technology Study

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TECHNOLOGY 2020

app feature, while 51 percent said they are offering mobile payment via their app.

Payment Options Inside the store, retailers universally accept payment by debit and credit cards, and three-quarters accept mobile payment from third parties like Apple Pay. More than half also accept prepaid/store value cards, electronic benefits transfer, and electronic check verification. At the forecourt, debit and credit cards are also universal, but there is much less of a degree of widespread acceptance among other forms of payment. Prepaid/store value cards are accepted at the pump by 54 percent of operators, followed by partial debit authorization (46 percent), third-party mobile payment (45 percent) and electronic check verification (40 percent). Likely propelled by the pandemic and consumers’ changing demands, c-store retailers appear to have big plans to add proprietary mobile payment via their apps

Most Cited Mobile App Features Store locator

100.0%

Proprietary product coupons

86.7%

Limited-time specials

74.3%

Fuel prices

69.8%

Vendor coupons

66.7%

Mobile ordering for pickup

66.7%

Customer feedback

63.9%

Mobile payment

51.4%

Mobile ordering for delivery

46.7%

Loyalty program tie-in

44.1%

Games

36.2%

Community service tie-in

20.0%

Source: 2020 Convenience Store News Technology Study

in the coming year, both in-store and at the forecourt. Inside the store, 50 percent of respondents said they plan to add proprietary mobile payment via their apps in the coming year, while 41 percent plan to add this form of payment at the pump. CSN

INDUSTRY AWARDS PROGRAM Drug Store News is proud to recognize, celebrate and honor women making outstanding contributions to their companies and the industry. More than 140 women were honored November 2019 at the inaugural Top Women in Health, Wellness and Beauty event and gala. Winners were awarded in the categories of Career Achievement, Business Excellence, Commitment to Care and Rising Stars.

Who will be honored in 2020? Visit www.dsntopwomen for updates on timing for nomination opening in the spring and details on the gala event in the fall of 2020. 112 Convenience Store News C S N E W S . c o m

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Increase Convenience with Self-Service Power your fuel and convenience network with Vynamic FCx solutions.

Learn more at DieboldNixdorf.com/FCx


NEW HORIZONS

Supporting Women of Color NEW offers resources for communities of color in an unprecedented time IF THERE IS a bit of sunlight shining on this unprecedented year, it is a renewed focus on dismantling the racism that permeates American culture. 2020 has become a reckoning point for so many, a moment where the country has at last acknowledged that being anti-racist, rather than simply “not racist,” is the key to an equal future for all of us.

By Sarah Alter, President & CEO, Network of Executive Women

I am reminded how vulnerable we feel this year. As we live through a global pandemic that has hit BIPOCs the hardest of all, the real suffering it has brought has permeated the bubble of privilege those of us who are white Americans have been living in. When pain comes to our doorstep, we are more understanding of the pain of others — awakened to the suffering they feel. And many are now waking up to the need for concrete action.

NEW’s Support for Women of Color NEW’s mission is to Advance All Women. Whatever has happened in 2020, we

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have not changed — it has always been our goal to transform workplaces for equality. Instead, the culture around us has changed. There is now a tailwind behind us and the work we do. When NEW published our Advancing All Women study, we found that, without intervention, the number of women of color in senior positions would drop over the next 10 years. Dismantling the systemic racism that has held women of color out of our boardrooms will take work, and that is exactly the sort of work NEW is here to support. This year, we released our Latinas in Corporate America study, which showed a real disconnect between Latinas and their mostly white male superiors. This lack of understanding of the unique value Latinas bring to corporate environments, of the lived history and cultural experiences they bring to bear, is a key pain point keeping Latina women out of C-suite roles.


Latinas in Corporate America was the first in a series of studies NEW will conduct into the experiences of women of color in our workplaces. We can’t resolve these issues without real research into the roots of the problem, conducted by listening, first and foremost, to the women they directly effect.

We Keep Working NEW’s resources for women of color are strong and continue to grow. Our powerful “NEW Action for Women of Color” workshop offers organizations a comprehensive solution for addressing bias in their workforce. While it is typically offered on-site, it will now also be offered virtually — because the issues facing women of color in the corporate world haven’t ended since your organization made the shift from offices to Zoom calls. We also offer dozens of learning and development webinars, both from our headquarters and from NEW’s 22 regions around the country. Our vast library of past webinar content, available via our website, is a treasure trove of insight. For more information on NEW’s resources for workplaces tackling bias, you can visit newonline.org/wocresources.

Convenience Store News is pleased to continue this series of educational columns by the Network of Executive Women (NEW), coinciding with the annual CSNews Top Women in Convenience awards given out each fall. Fiftytwo female managers, executives and directors who work in the convenience store industry will be honored in our 2020 program. In addition to being a presentation sponsor for the Top Women in Convenience program, NEW and CSNews have partnered to develop this series of columns directed at helping corporate leaders drive more inclusive company cultures. 2020 SPONSORS Founding & Presenting Sponsor:

Platinum Sponsors:

Gold Sponsors:

NEW has always been here for women of color. Our mission is to Advance All Women. This year, we can all feel the hope in the air that the tide is turning for people of color in America. NEW will continue to be a part of that fight until our work is no longer needed — a day we can all look forward to. CSN

Sarah Alter is president and CEO of the Network of Executive Women, a learning and leadership community representing 13,000 members in 22 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.

Silver Sponsor:

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STORE SPOTLIGHT

A Culinary Experience CEFCO Kitchen creates a new brand committed to fresh and delicious food offerings By Danielle Romano

At a Glance CEFCO Kitchen Location: 5951 Airport Road, Temple, Texas Size: 6,037 square feet Unique features: First Gen-3 location for the retailer; introduces the newest and cutting-edge fountain and frozen beverage machines, bean-to-cup coffee machines and digital menu boards; made-toorder burrito bar; Fresh Yo! self-serve frozen yogurt bar

MODERN-DAY CONVENIENCE stores are redefining their foodservice programs by crafting them into an experience, through the introduction of limited-time offers, implementing new technology to simplify and streamline the ordering process, and optimizing product assortment.

brand into something that our customers automatically associate with delicious food and affordable prices,” expressed Reagan Francis, brand manager for Temple, Texas-based CEFCO.

Big, Bold Offers

Building on a three decades-long legacy of serving consumers’ convenience needs, the primary goal of CEFCO Kitchen is to promote the retailer’s foodservice products by creating a brand that it can build upon by introducing more fresh and delicious food offerings.

Located at 5951 Airport Road in Temple, the first CEFCO Kitchen store is not only the closest location to the retailer’s corporate office, but it is also the first to feature a made-to-order foodservice concept. Embodying the company’s ongoing commitment to provide the best culinary experience for its customers, the centerpiece of CEFCO Kitchen is a made-to-order burrito bar where guests can custom-design their favorite burrito combining fresh ingredients such as grilled steak, roasted corn, and seasoned black beans.

“In the short term, we will gain valuable insight into what foodservice products our customers enjoy the most so that we can work on making these products more readily available. In the long term, we hope to build the CEFCO Kitchen

“These big burritos are not only a phenomenal value, but they are also truly delicious and flavorful. Long term, big and bold flavors are going to be our defining foodservice feature,” said Carlos Acevedo, director of foodservice for CEFCO.

CEFCO Convenience Stores is one of the operators making this transition with its first-ever CEFCO Kitchen store, which puts customers’ culinary experience front and center.

116 Convenience Store News C S N E W S . c o m


CEFCO Kitchen also offers an assortment of breakfast, lunch and dinner fare, including breakfast sandwiches, hash browns, fried chicken and spicy chicken wings, roller grill items, and side dishes such as mashed potatoes and mac and cheese. “I have a weakness for hot dogs and have ensured that our roller grill assortment is top-notch. Our hot dogs are high-quality all beef and there is a tasty selection of condiments we keep fresh in a cold well,” noted Acevedo, who served as the innovation and research chef at Yesway Convenience Stores before joining CEFCO this past March. CEFCO Kitchen pays close attention to its beverage offering, too. The concept store serves as the retailer’s first Gen-3 location and introduces the newest and most cutting-edge fountain machines, bean-tocup coffee machines, digital menu boards,

frozen beverage machines and more. The 6,037-square-foot store features an impressive 48-head fountain unit, as well as fresh tea. For customers in the mood for coffee, new sleek and sophisticated bean-to-cup coffee machines can grind and brew a cup of coffee in under one minute for optimum freshness, and can mix and match beans for unique and fun options, such as half-caf (half caffeine) and iced coffee. “2020 and 2021 are going to be about finding a balance between streamlining certain areas of our menu, particularly in retail, while doubling down on fresh breakfast and hot snacks,” said Acevedo. “Essentially, the next two years will be about optimizing our assortment, improving execution, and building an identity around fun and craveable foods with big flavors.” Other amenities at CEFCO Kitchen include: • The Fresh Yo! self-serve frozen yogurt bar with complementary toppings; • A beer cave; • ATM machine; and • Eight fueling stations that include ethanol-free fuel and four truck lanes.

Pooler Parkway, GA

2019 WINNER BEST ORIGINAL DESIGN EnMark is a wonderful example of a very successful company in our industry that had outgrown its brand and its store design. The first thing Paragon did was to transition them from EnMark to EnMarket. Everything about the new name screamed fresh and relevant. The starting point was a unique color palette that featured a signature green. The contemporary materials included stone, brick, metal and wood that blended together to present a warm and inviting architecture that featured clerestory windows, a drive-thru and multiple entrances. It is obvious from the moment you drive on the site that there is a new brand in town and that brand is EnMarket.

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STORE SPOTLIGHT

CEFCO Kitchen is about building an identity around fun and craveable foods.

Nowhere to Go But Up

store opened in Nolanville, Texas in late June.

The CEFCO Kitchen store is the retailer’s first ground-up build in 2020, but it won’t be the last. The c-store chain has big plans for the new food-forward concept. According to Francis, CEFCO will continue to grow and improve the concept, and will implement it in all new builds going forward. The second CEFCO Kitchen

“We can’t wait to continue building this brand!” said Francis. CEFCO currently operates approximately 250 stores in seven states, including Texas, Oklahoma, Louisiana, Arkansas, Alabama, Mississippi and Florida. CSN

THE FUTURE OF THE PATH TO PURCHASE IS ONE SCAN AWAY Just as the industry re-invents how we do business, and how we engage with shoppers, we’re also re-inventing P2PX, to provide new insights, new solutions, and even new ways to register. With more shoppers than ever turning to QR codes, we invite you to scan the code above for an all-access pass to connect and engage with retail leaders, brand teams, and best-in-class solution providers—all committed to navigating the future that’s already here.

INTRODUCING THE ALL-NEW

THE FUTURE IS HERE

118 Convenience Store News C S N E W S . c o m

EXPERIENCEP2PX.COM


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ATM’s

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ATMs

Gourmet Pet Treats

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Energy Product Pouches

POS/Equipment/Supplies

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HOT PRODUCTS SPECIAL ADVERTISING SECTION

Beef Jerky

Age Verifier

86

%

of retailers

who read Convenience Store News do so because they want to find out about new products. Reach those important hard to reach retailers by advertising here in the Hot Products Section of Convenience Store News by contacting:

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. 201-855-7615 for more details 126 Convenience Store News C S N E W S . c o m

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General Merchandise

General Merchandise

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Services

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Credit Card Processing / Merchant Services

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ATMs

Air Vacs

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Covid 19 Cleaning Product

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Plastics

Foodservice Program

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CLASSIFIEDS

Sunglasses

ATM’s

For Sale

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CLASSIFIEDS

Petroleum/Equiment

PrePaid Kiosks

Looking for ideas to promote your product or services? Need help creating an ad that fits your needs without spending a fortune with an advertising agency?

We are here to help, whether it be in the classified ad section, an ad in the main pages, or online. Call or email with any questions or for pricing. We can handle all aspects of your ad from conception to print in a fraction of the cost that agences charge!

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Credit Card Processors

Services

Age Verifier

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CSN

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TERRY KANGANIS

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CLASSIFIEDS

Equipment / Supplies

Wholesale Refrigeration

C-store Services

Check Guarantee Services

ADINDEX ADD Systems..............................31 Altria Group Distribution.......2, 3 Anchor Packaging....................54–55 Autofry/MTI, Inc........................38 Baker Boy Bake Shop..............63 Buzzballz LLC.............................59 Calico Brands.............................66 Clif Bar & Company..................67 Coca-Cola NA............................57, 85 DD & B Solutions.......................75 Del Monte Fresh Produce N.A................................15 Diebold Nixdorf.........................113 E-Alternative Solutions...........43, 81 EPTA America............................33 Forte Products...........................53 General Mills................................83 Glanbia Performance Nutrition.......................................73 GlaxoSmithKline Consumer Health Care.................................29, 69 Goodwest Industries................65 Hughes Network Systems.....105 Inline Plastics Corp...................37 ITG Brands...................................39 Jelly Belly.....................................5

Johnsonville Foods..................79 JTM Foods...................................45 Krispy Krunchy Chicken.........87 Liggett Vector Brands............49 Living Essentials LLC...............9 Mars Wrigley Confectionery............................16–17 McLane Company..................... Back Cover Motel 6.......................................... Front Cover Paragon Solutions....................117 Patron Points, Inc......................109 Premier Manufacturing........... 95, 97, 99, 101 Procter & Gamble.....................25 Red House Manufacturing.....23 Reynolds American Trade Marketing Services...................76–77 Saputo Cheese USA, Inc........61 Skupos .........................................107 Swedish Match North America LLC...............................7, 47, 71, 119 Swisher International Inc........................11, 12–13, 139 The Hershey Company...........26–27 Universal Merchants................ Outsert VOSS Water................................35 WorkJam......................................111

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INSIDE THE CONSUMER MIND

Competitive Eats C-store prepared food buyers say they can find better quality elsewhere As the COVID-19 pandemic is shaking up the foodservice industry — prompting players to move to mobile/online ordering, curbside pickup and home delivery if they haven’t already done so — the lines between foodservice purveyors are getting increasingly blurrier. Convenience stores have their work cut out for them. According to the 2020 Convenience Store News Realities of the Aisle Study, which surveyed 1,500-plus consumers who shop a c-store at least once a month, consumer sentiment regarding the quality of c-store prepared food has risen in recent years, but shoppers don’t necessarily think it’s the best option. Digging deeper, the research reveals:

Prepared Food Comparison: Convenience vs. Other Channels Better

Casual Dining Fast Food

Similar

Worse

Don’t purchase from

55%

24%

49%

Fast Casual

48%

Grocery/Supermarket

46%

11% 10%

38% 32%

9%

3%

9% 11%

41%

8%

6%

Source: Convenience Store News Realities of the Aisle Study Base: 1,213 U.S. shoppers aged 18+ who purchased prepared food from a c-store in the past month

Additionally, 49%

consider fast-food restaurants to be better and 48% think fast-casual is better.

66%

Two-thirds of c-store prepared food buyers (66%) say they are most likely to purchase from a fast-food restaurant when they do not purchase from a convenience store. 138 Convenience Store News C S N E W S . c o m

37%

1. Didn’t plan to purchase when I went to the store

35%

More than half of convenience foodservice shoppers (55%) say the prepared food they’ve purchased at casual-dining outlets is better than what they’ve received at c-stores.

The Top 5 Reasons C-store Shoppers Don’t Buy Prepared Food

Interestingly, despite their frequent visits to c-stores, more daily shoppers than weekly or monthly shoppers consider the prepared food served at fast-food and fastcasual restaurants to be better than c-store prepared food.

12%

say they are most likely to instead prepare and eat food at home.

9%

say they are most likely to go instead to a fast-casual restaurant.

2. Prefer not to purchase prepared food at a convenience store/gas station

29%

3. Wasn’t hungry when I was in the store

22%

4. Didn’t look appetizing

17%

5. Didn’t like selection


THE PERFECT PAIR

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FOR MORE INFORMATION CONTACT YOUR SWEDISH MATCH REPRESENTATIVE 800 -367-3677 • CUSTOMER. SERVICE@SMNA .COM

WHITEOWLCIGAR.COM © 2020 SMCI Holding, Inc.


McLANE’S TECHNOLOGY WILL POWER YOU FORWARD McLane understands the competitive advantage technology can provide, and we’ve made substantial investments in building technology solutions to address the specific needs of c-stores. Our hardware and software solutions help our customers improve order accuracy, reduce labor costs, optimize inventory and increase margins, just to name a few advantages. From the corporate office to the back office, McLane offers the technology solutions that help retailers buy better, sell smarter and profit more.

To learn more about McLane’s innovative technology solutions for c-stores, visit mclaneco.com/technology

© 2020 McLane Company, Inc. All rights reserved.


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