C-stores may be the most straightforward of shopping channels. They provide people with items they might need in transit, whether that’s simply to and from work or on a cross-country road trip.
As American culture becomes mobile and meals are replaced with more substantive snacks, c-stores have become a natural place for people to find sustenance on the go. While the majority of purchases are still driven by gas, much of the growth in c-stores comes down to food purchases, whether it’s packaged snacks or food service items.
“Consumers are coming into the store because they have a need to satisfy hunger or boost their energy,” said Krisanne Flamini, category manager, total snacks, confections and packaged cake, Wawa, Pa.-based Wawa. “If that’s dictating their purchase, they might grab an energy bar, but if they are looking for something to satisfy an emotional need, they are going for the more indulgent snack.”
The numbers, as reported by Information Resources, Inc., reflect this. While overall dollar sales for fresh bread dropped 10.4% in the 52 weeks ended Dec. 2, 2018, individual categories were up such as bakery snacks (0.6%), donuts (5.2%), pastry/Danish/coffee cakes (1.7%), muffins (4.7%), other fresh rolls/bun/croissants (2%), bagels (7.7%), and pies and cakes (8.8%). Many of these increases confirm that breakfast is the biggest opportunity for baked foods in this channel. Salty snacks apparently pick up the slack throughout the rest of the day, showing a 5.2% increase during the same time period with only a few categories — corn snacks, nutritional bars and granola bars — seeing a decrease.
“Convenience stores have seen the most growth in Food Forward c-stores that focus on preparing fresh foods,” said Jennifer LaPaugh, senior director, global market research and insights, Dawn Foods, Jackson, Mich. “Consumers see these stores as a convenient way to get their breakfast and snacks as well as an alternative to quick-service restaurants and other food service segments.”
The growth of food service doesn’t mean the decline of packaged snacks in c-stores.
“Shoppers tend to gravitate more toward flavored snacks and purchase snacks used as an accompaniment for quick-serve meals throughout the day,” said Chad Matthews, senior vice-president, sales, small format channels, Frito-Lay North America, Plano, Texas. There are several strategies bakers and snack manufacturers can use to snag this impulse purchase.
High visibility and displays help get product in front of the shoppers. Consumers are drawn to the snacks when c-store operators place product in their way next to or on the way to the food service counter.
“Snacks need to be very visible in the store, so your product needs to be right there in the middle of the store in a kiosk so consumers are walking past snacks as they head to prepared foods,” Mr. Clark said.
Size and variety also come into play.
“C-stores have gone from selling big bags to much more emphasis on single-serve,” Mr. Clark said. Larger bags don’t lend themselves to the on-the-go lifestyle convenience stores serve, nor do they make a natural counterpart to a food service meal.
Bakers and snack manufacturers need to provide c-store shoppers with a wide variety of flavors and products. This channel isn’t heavily driven by price. Its shoppers could be considered captive as they are there and buying for convenience, so companies have to win the impulse purchase another way than a hot deal. Extreme or innovative flavors and new products is one way to do that.
“In c-stores, we’re seeing snack manufacturers coming out with extreme flavors across all categories, whether it’s something that’s completely unique or an intense flavor,” Ms. Flamini said. “We’ve seen a blend of snack and confection where they’re mixing sweet and salty together.”
The c-store shopper comes in and out of the store day after day, said Bob Clark, vice-president of marketing, Herr Foods, Nottingham, PA. And because they are individuals making impulse purchases, companies can use c-stores as incubators for new ideas.
“There is a lot of desire for variety, and it drives us to develop more flavors, even limited-time only flavors, to keep excitement going and keep them engaged,” he said. “We’ll put the newest flavors in the c-store immediately. People are going back to the convenience store every day for lunch, and they’re always trying something new, and that’s driving innovation.”
Compared with supermarkets, c-store purchases are primed to encourage shoppers to try something new instead of grabbing a standard favorite.
“It’s an individual purchase that you’re buying for yourself, while in the supermarket, it’s usually mom buying for the family, so she has to know the product is a winner before making the purchase,” Mr. Clark said. “At the c-store, it’s a one-time purchase, so it’s grab-and-go by nature.”
Shoppers also find products in the c-store aisles that they wouldn’t find in supermarkets, where shelf space is at a premium. While a bakery or snack company may be wary to dedicate supermarket shelf space to a new product that isn’t a sure-thing, the c-store is a completely different story. In fact, the channel is a playground in which a company can try out its new ideas.
“While I wouldn’t call it a test, we’re introducing a new product in a single-serve size in this channel,” Mr. Clark said. “If it does well, we’ll consider selling it in a full-size bag and offering it to supermarkets.”
Herr’s has seen recent success with its pub-style pretzels. With pretzels being a popular snack in the company’s mid-Atlantic market, a sourdough variety was an obvious choice. The company also launches limited-time-only flavors in its kettle chip line alongside its ever-popular jalapeño flavor. Herr Foods’ is pursuing cheese curls, which Mr. Clark said are seeing rapid growth among younger consumers.
Frito-Lay North America uses a rigorous process relying on consumer insights to link demand to unmet needs and marketplace opportunities.
“Our innovation pipeline for the c-store channel is a result of this deep consumer understanding,” Mr. Matthews said.
As people redefine the way they eat and shop for their food, the c-store holds a lot of opportunity for baking and snack companies. Bakeries can find opportunities in the food service operations, breakfast foods and clean label comfort foods. Snack companies can leverage their products as counterparts to food service purchases, and they can generate excitement with innovative flavors and products. With freedom and permission to experiment in this space, baking and snack companies can grab consumers’ attentions and get that impulse purchase.