Is it really a Convenient Store?

by Iris D’Souza, Bergent Research

The challenge for any industry is to survive during times of recession. The good news is that consumers will spend money on food and groceries regardless of the state of the economy, and the sector contributes more than $100 billion a year in turnover to the national economy. Then why is it, that the convenience sector has only a 20% share?

Considering this statistic and how people regularly top-up on fuel, it must be agonizing for convenience store management who wonder why their stores have perhaps not caught-on as well as they should have. Convenience stores should be perceived as a mod-con to ease our fast paced lives. After all, we can’t think of a better, more convenient place to grab that quick carton of milk, loaf of bread, and possibly even a more extensive grocery shop. Clearly though, there exists a gap that is not being addressed.

In this issue, we will take a look at potential reasons affecting footfall and/or spend in convenience stores.

Here are some of the most common issues plaguing the convenience sector and ways of addressing them. Remember though, as with any industry, one solution does not fit all:

1. Value

• Very often shoppers will only use convenience stores to buy essentials, leaving less urgent items for their supermarket shop. Clearly, value isn’t being communicated to shoppers and neither is convenience!
• Give shoppers a reason to justify their spend by improving adjacencies or using cues to communicate value.

2. Product Range

• When questioned, most shoppers will tell you there isn’t enough range in convenience stores. Interestingly though, narrowing the range can actually help shoppers be more efficient with their time. It is a fine balance between keeping it simple and yet giving the illusion of range.
• Know your local market, or route market. One of the key questions store management should be asking is what their core shoppers consider important - whether it be products, services or brand availability.

3. Navigation

• Convenience stores are a quick-shop destination. Shoppers typically want to be in and out in the shortest possible time. If shoppers feel they are spending more than the allocated time in-store; chances are they are unlikely to repeat the experience.
  
• Having a pleasant experience will make shoppers feel they have spent less time in-store. The reverse is also true.
  
• There are many different reasons why shoppers perceive stores to be too complicated to navigate. Paying attention to some of the following areas will help shoppers improve speed and efficiency through:
  o Targeted store layout
  o Adequate in-store signage
  o Appropriate in-store advertising
  o Well laid out planograms
  o Reduction in number of competing products to sift through
  o A simple yet intriguing store layout and design will allow shoppers to spend as little time as they want, but still encourage exploration by piquing interest.

Clearly with room and good reason to grow the convenience sector, stores should be taking a look at maximizing ROI. Each store is unique and comes with its own set of issues and solutions. Shopper research helps prioritize actions for improvement - it focuses efforts on how best to boost footfall and sales in-store. Research is proven to be the best way to uncover the reasons behind what is going on in shoppers’ minds and lend insight to help improve spends and increase sales.

With vast experience in this arena and a close connection with shopper research and insights, Bergent is pleased to offer a free consultation to convenience store management to help explore opportunities for their particular store through research. Bergent consultants can be reached on 03 9322 4000.