The Changing Role – and Growth – of Convenience Stores
Once upon a time, convenience stores were gas stations with a small retail establishment attached. Consumers would visit these places to fill up their cars and maybe buy a pack of gum or another small item for good measure.
But in its recently released white paper, “C-Store Trends & the Brands Leading the Way,” Placer.ai explained that convenience stores – or “c-stores” these days aren’t anything like those of yesteryear. Some convenience stores still obtain their revenue from gas and car services. But others “places to grab a specialty coffee, get a quick dinner, or pick up a few grocery items on the way home from work,” the white paper said.
The Rise of the C-Store
Another fun fact: In recent years, c-stores have done remarkably well on the retail scene, outpacing some related categories, including grocery. “Though the sectors’ YoY gains fell behind those of the coffee and QSR segments, this appears to be due largely to convenience stores’ already stellar 2022 performance,” according to the white paper.
“There had been some anecdotal evidence that c-stores had started to become more competitive against other food retailers,” R.J. Hottovy, Placer.ai’s Head of Analytical Research, told Connect CRE. “But we were surprised by the magnitude of visitation share gains the c-store category has made the past few years.”
Additionally, while higher gas prices meant fewer visits to fueling stations, “foot traffic at convenience stores trended sharply upwards,” the white paper said.
There are two reasons for this:
Inflation. In the face of higher prices, people look for affordable luxuries. Additionally, consumers would stop at a local C-store to pick up a few essentials instead of going on a time-consuming, large grocery run. Hottovy said inflation had driven more consumers to shop at dollar and value-oriented grocery stores. “But many C-store chains are also seeing a similar lift in visits as well,” he said.
Better food offerings. C-stores provide more choices, including fresh coffee, baked goods and tasty fast food. Customers can buy and enjoy a 7-Eleven Slurpee and hot dog, a Wawa hoagie, a pizza from Casey’s or a Buc-ee’s brisket sandwich.
“If we compare the c-stores that have captured the most visitation market share over the past several years, it’s the chains that have really prioritized their food offerings,” Hottovy commented. “Wawa is a great example of this, with several new menu additions and an increasing number of drive-thru pickup windows.”
Regionalization and Summer Fun
The Placer.ai white paper also noted that:
The C-store segment is highly regional. 7-Eleven, while a national brand, dominates on the West Coast, Maverick – Adventure’s First Stop is famous in Wyoming and Utah; Cumberland Farms is the C-store mainstay in New England, Buc-ee’s is highly popular in Texas, and the go-to convenience store is Wawa for residents of Florida, Maryland, Pennsylvania, Virginia and New Jersey.
C-stores are highly popular during the summer months. The white paper suggested that people increase their visits to convenience stores during warmer weather, especially those that offer more of a recreational vibe. From a regional perspective, colder northern states experienced higher summer peaks than their warmer counterparts, like Florida or California.
Will it Continue?
Due to the sector’s strong performance, many of the C-store brands are in the midst of expansion. They’re building new stores while growing their footprints in other ways. For example, the C-store space “has seen a flurry of mergers and acquisitions in recent months,” the white paper said. In 2021, 7-Eleven acquired Speedway, while in April 2023, Maverick inked a deal to buy the Iowa-based chain Kum & Go.
The white paper noted that c-stores’ repositioning as inexpensive grocery stores and quick-service restaurant venues means “they’ve flourished even as high fuel prices kept gas station visits down.”
“While we’ll likely see some moderation in c-store visits as we move past the peak summer travel season, we expect this category to continue to see positive visitation growth for the balance of 2023 and 2024 through affordable food options and expansion into new markets,” Hottovy added.
I love content. I love writing it, visualizing it, and manipulating it to fit into different formats. I have years of experience in working with content, both as creator and editor. The content I create and edit provides assistance with many goals, ranging from lead generation, to developing street cred through well-timed thought-leadership pieces. Content skills include, but aren't limited to, articles and blogs, e-mails, promotional collateral, infographics, e-books and white papers, website copy and more.