Pulse report:Convenience Stores: Keep the Core; Appeal to More

The convenience channel was the only channel to experience both dollar sales and unit growth in 2012, according to the IRI report, "Convenience Stores: Keep the Core; Appeal to More."

The channel is experiencing above-average growth due in part to an increase in the number of stores and a business model tailored to the needs of on-the-go consumers. In fact, in 2012 convenience stores overall posted 1.2 percent unit sales growth and dollar sales growth of 2.4 percent, according to the May 2013 edition of IRI's Times & Trends.

Success in the convenience store arena is not without challenges, however. Because many stores sell fuel and sales are somewhat tied to those purchases, if gas prices spike, consumers have less money to spend on additional purchases.

Piyush Chaudhari, President of the Americas and Global Strategy, IRI

Convenience store sales also are concentrated in a limited number of categories. For example, of the six largest convenience categories, three are related to tobacco.

Competition from other channels, namely drug and dollar stores, is intense. These channels share many of the same attributes as convenience stores, including size, location and some similarities in product mix.

To continue to generate healthy growth in the coming months and years, convenience store marketers must stay on their toes and cater to evolving trends.

The foodservice segment is currently experiencing strong growth within convenience stores. Prepared food is designed to appeal to on-the-go shoppers and should be used to elevate the perception of convenience stores as destinations for convenient and healthy meal and snack solutions.

Health and wellness is another key opportunity for convenience store marketers. To excel in this area, marketers must cultivate an overarching promise of health and wellness for their consumers, with special attention to the specific perspectives and goals of their core shopper base at the store level.

And, outdoor advertising remains a key to maximizing fuel-up visits by acting as a tool to lure shoppers into the store.

Same-Store Convenience Dollar Sales Growth Source: IRI AllScan™

CPG Industry Growth Trends: Dollar & Unit Sales Multi-Outlet + Convenience and by Channel, 2012 & 2011 Source: IRI AllScan™; 52 weeks ending Dec. 30, 2012, and same period prior year.

Thanks to an expanding store base and its ability to connect with time-starved consumers, the convenience channel enjoyed strong dollar sales and unit sales growth in 2012.

Top 10 Growth Categories Based on Unit Sales Percent Change 2012 vs. 2008, Convenience CHANNEL *Among the top 50 categories based on convenience channel dollar sales. **Average price change based on price per volume analysis. Source: IRI AllScan™; 52 weeks ending Dec. 30, 2012, and same period prior year.

Nutritional Profile: Weighted Average Content Per Serving Multi-Outlet versus Convenience Channel Source: IRI Market Advantage

Convenience stores' focus on quick, convenient–and sometimes indulgent–products is evident in the channel's 10 top-selling categories. Increased product availability is a significant driver of sales momentum.

TIP:Identify opportunities to develop new offerings that solve the key needs and wants of target consumer segments.

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