Although summer travel is in the rear view mirror, it's a great time for convenience and fuel retailers (c-stores) to gear up for the fall foliage and holiday travel seasons.
People want a good mix of convenience when in a hurry and comfort when they need to get out of the car and relax for a short while. As such, here are some of the top trends NCR Voyix expects savvy c-stores to explore to make the most out of the rest of 2023's road trips and beyond.
Travelers hitting the road, self-service brings them back
Sixty-eight percent of Americans plan to travel this winter season. With people packing up their cars and headed to see fall foliage and going out of town for the holidays, c-stores can expect more foot traffic and therefore more revenue even as the warmer travel months wind down.
These shoppers will want a more seamless experience allowing them to get in and out quickly, both in the forecourt and in the store. In fact, RBR Data Services reported that more and more c-stores are deploying self-serve technology if they haven't already done so.
Those who shop at brick-and-mortar retailers already know self-checkout is everywhere, from grocery stores to restaurants to c-stores. Even smaller c-stores have self-checkout systems, allowing them to compete with the larger chains. Self-checkout stations can also help c-stores solve labor shortages and provide what their name implies — greater convenience for consumers.
As the year closes out, and 2024 budgets are finalized, the c-store industry will likely see more plans announced for the installation of self-service technology.
Tap-and-go payments at pump, mobile app options more prevalent
Speaking of convenience, c-stores should know the typical in-a-hurry shopper spends less than four minutes inside the store. As such, c-stores are increasingly implementing programs that put customers first by meeting their need for speed.
For example, gas stations are providing better customer experience by accepting tap-to-pay capabilities that became popular during the pandemic and mobile payments, such as Apple Pay or Google Pay. Many retailers even have their own app, often allowing transactions to occur without leaving the car.
Valero, Citgo, Marathon and BP are a sampling of petroleum companies that have recently rolled out programs enabling consumers to use an app to authorize pump purchases from their smartphone. Although the rewards/loyalty programs differ slightly, the apps will continue to help draw customers in by unlocking rewards, such as fuel purchases and other in-store items, for travelers this year.
Edge technology edging into c-stores
Edge computing is making its way into more and more c-stores as well to drive operational efficiencies and agility.
According to IDC, spending on edge computing is expected to reach $208 billion globally in 2023 — up 13% from 2022 and $317 billion by 2026. Edge, according to IDC, is, "technology-related actions that are performed outside of the centralized data center, where edge is the intermediary between the connected endpoints and the core IT environment."
As the number of applications, smart devices, sensors and end points in stores grows, edge technology is becoming extremely popular because it can cope with increased data volumes, real time requirements and network conditions that centralized cloud infrastructure cannot easily handle. These include latency, jitter or availability issues, typical to many large, distributed retail store estates. The common theme among retailers is the need to make changes faster and have more agility in order to keep driving improvements to the customer experience in stores. A good example of this is c-store chains deploying updates to their point of sale in minutes rather than days or weeks.
As adoption of edge technology by c-stores increases, retailers will see a faster time to market and a lower cost of change, just like their digital channels.
Edge technology isn't edging cloud technology out though. Savvy IT teams recognize that the cloud is highly valuable for building AI learning models and pushing improved changes back out to systems running at the edge. Combining the two technologies to create the optimal retail infrastructure for employees and customers alike is the way forward.
Making it comfortable to come in and stay awhile
Although c-stores are known for speed, they are also simultaneously innovating to entice families to stop, hang out and have some coffee or a meal.
A driving force for this change in consumer mindset to "stay awhile" at c-stores is the increase in electrical vehicles as modes of transportation and offering EV charging stations, which could be key to increasing overall profits. Although the U.S. has approximately 140,000 public EV charging ports, as consumers continue purchasing EVs in favor of gasoline-powered automobiles, convenience stores would be wise to consider adding charging stations.
Benefits of doing so include increased foot traffic as EV owners come inside the store to shop as they wait for their vehicles to charge. This is likely to lead to increased sales of food and beverages, particularly as road warriors want to minimize their stops and get on to their destination.
Aside from EV stations, c-stores are also offering healthier or more gourmet food and drink options. This includes salads, made-to-order meals, fruit smoothies and even kombucha on tap.
Others offer craft beers, a wide selection of wines and several varieties of coffee. For example, Race Trac offers "crazy good coffee," luring consumers in to wander around and try out their freshly brewed, freshly ground, on-demand coffee — with or without toppings and piping hot or ice cold. Some brands are even increasing their outdoor seating areas to give customers a comfortable place to rest and refuel their bodies and their cars.
As 2023 draws to a close, the industry will likely see more c-stores making moves to evolve from just gas stations into destinations.
M&A restructuring activities increase
Many of the larger convenience stores will start to take advantage of the down market and will buy or restructure their debt load from CapEx and OpEx models. The EG Group is a prime example: the retailer just went through a public real estate restructure and to a lease model. This will allow the company to become more agile and save more money, benefiting all stakeholders in the long run.
However, managing tech stacks amid acquisitions and restructures like these can be difficult. It's important that c-stores can avoid the legacy tech trap and implement high-impact innovation with trust & contained operational disruption. C-stores need modern IT infrastructure that extends from the in-store edge to the cloud software, enabling a streamlined operating model.
The takeaway
"Convenience and fuel retailers will continue to be known for their speedy service and convenience," said Eric Schoch, executive VP and president, retail, NCR Voyix. "However, many changes are taking place — ones that follow consumer patterns: EV charging stations to attract the increasing number of motorists who've purchased electric vehicles. Patrons who will pass up candy bars and soda for a healthy salad and freshly ground coffee. And edge computing will help convenience store operators elevate the experience for both consumers and store associates.
"By keeping some of these emerging trends in mind, c-stores can look for a successful fall foliage and peak season — when consumers will be traveling more and looking for all that convenience stores have to offer."