Are Convenience Stores Becoming the New Quick-Service Restaurants?
Traditionally, food from convenience stores often focuses on packaged snacks, and hot food offerings may be perceived to be of dubious quality. Yet according to research from Nation’s Restaurant News, convenience store food quality is improving, shifting consumer perceptions and becoming a threat to fast food restaurants.
However, if a fast food restaurant has moved in the direction of fast casual, as many have in recent years, they will likely be unaffected by this shift by convenience stores, since the convenience stores are catering to a market that they have left behind. Fast casual offers elevated design, better food quality, and better experiences for slightly higher prices, while new convenience store strategies appear to be all about value (and one-stop shop convenience). Many fast food restaurants are also phasing out low priced value menus, showing a move away from the value strategy, which opens up space for convenience stores to meet this need.
If a fast food brand has resisted the fast-casual play, they may now be facing direct competition from convenience stores offering better experiences and higher quality food. The following convenience store examples demonstrate this shift.
Sheetz is an convenience store and gas station that aims to rival quick-serve restaurants. It claims to be a “mecca for people on the go” and to “have what you need to refuel your car or refresh your body”, 24/7/365. They offer better experiences and products with made to order food that can be ordered online or through a touchscreen, as well as prepared ready-to-eat items, a bakery, and an espresso bar with coffee beans that are freshly ground in-store. The loyalty program consists of three tiers depending on each customer’s number of points, labelled as Fan, Friend, or Freak, that get progressively better rewards. Rewards include invitations to events, opportunities to be the first to try new items, surprise freebies, and exclusive offers.
Key Takeaway: Sheetz moves into quick-service restaurant territory with its made to order food selection and strong loyalty program.
Similarly, Wawa is another convenience store that has elevated their customer experience and menu offerings in recent years with a great deal of variety. Food selections are fresh Built-to-Order (custom ingredients) or Ready-to-Go items for all dayparts. For breakfast, there are breakfast sandwiches, bagels, muffins, egg bowls, and oatmeal, while lunch and dinner items include hoagies, salads, wraps, soups, meatballs, chicken strips, mashed potatoes, mac n’ cheese, and burrito bowls. Snack items such as fresh fruit, ice cream, soft pretzels, and a wide variety of beverages are available as well. Wawa also has a rewards program and mobile/touchscreen ordering.
Key Takeaway: Wawa offers a menu for all dayparts and occasions to meet the needs of a wide variety of customers.
Casey’s General Store
Casey’s General Store is a convenience store chain in the Midwest US that aims to be a community gathering place similar to a local restaurant. The brand supports local charities and values friendliness and a welcoming atmosphere. Its messaging speaks to making you feel at home and being a great neighborhood place. On the menu are items such as homemade pizza (with delivery available), burgers, salads, sandwiches, and donuts baked fresh in-house. Online ordering is available and there is a loyalty program.
Key Takeaway: Casey’s General Store creates stronger brand loyalty and awareness through community support, social space, and proprietary food items.
7-Eleven is a major convenience store brand around the world. While associations with the store in North America may still be of Big Gulps and chips, in other countries it is a go-to fast food option. In Japan for instance, 7-Eleven has many stores which are popular destinations for hot and freshly prepared food, such as onigiri and meat skewers, with frequent deliveries and microwaves available on site. Free wifi is available and staff are friendly and helpful. Family Mart and Lawson are other convenience stores in Japan that also offer quality food items at low prices. With success in improved offerings in other countries, it is likely that 7-Eleven in North America will follow. In fact, this seems to be beginning already, as 7-Eleven has recently introduced fresh brewed ice coffee, a mobile rewards app, and more diverse food options.
Key Takeaway: 7-Eleven appears to be on the path of transitioning to a fast food style experience.
For a convenience store operator, it is important to recognize this trend and consider the opportunity it presents. Many fast food restaurants are leaving space in the market for value fast food as they create more upscale experiences, and brands such as Sheetz, Wawa, Casey’s General Store, and 7-Eleven are capitalizing on this shift by improving their menu offerings. These convenience stores are also developing stronger connections with their customers by offering better experiences, service, and loyalty programs. These changes will attract new customers and keep the regulars coming back. Offering affordable, convenient, quick, quality ready-to-eat food and beverages in a pleasant environment is a value proposition that customers with busy lifestyles will appreciate.