Howland Blackiston, Principle of King-Casey, recently spoke at the 2017 AACS Leadership Summit in Sydney. Howland shared some valuable insights into what is working for C-Stores in the USA. Attendees learnt plenty of actionable strategies to implement in their stores.
During the AACS Leadership Summit, nearly every speaker alluded to the fact that C-Stores must cater for Millennials and Howland was no exception. Wanting to share these strategies with ServoPro members and the wider community, I caught up with Howland Blackiston to talk more about his trip to Australia and the message he had to share. Enjoy…
How did you find Australia, Howland? Was it what you expected?
By now, I have managed to get around over 45 different countries but, until this trip, Australia had not been one of these. So I wholeheartedly welcomed this opportunity to give the keynote at the 2017 AACS Leadership Summit. That added another country and another continent to my travel log. I was not disappointed – Sydney is a vibrant, sophisticated and beautiful city. The awesome beauty of the Blue Mountains is deeply impressive. All of the Australians I met were friendly, hospitable and sincerely welcoming. I only wish I had more time on this trip to see more of the city and explore more of what is clearly a magnificent continent.
When you were in Australia, did you get a chance to have a look at some petrol and convenience stores? What do you think we are getting right and what areas could we improve on?
Alas, I only managed to visit a few different C-Store concepts within the city of Sydney. So that’s not a good sampling upon which to draw meaningful conclusions. But I suspect the challenges and opportunities facing your brands are likely not too different than those facing C-Stores in the USA. And that is, how can brands differentiate themselves in the market? What can C-Stores do to be more relevant to millennial customers? What can we learn from leading international food-service brands (e.g., Starbuck, McDonalds) to better merchandise a C-Store’s profitable food and beverage offerings?
Howland, could you give us a brief outline of who King-Casey are and the services they offer?
King-Casey, founded in 1953, is a renowned American-based retail branding and design firm. King-Casey has a particular expertise in helping many of the best-known Quick Service Restaurant (QSR), Fast Casual and Casual Dine foodservice brands by strategically improving the customer in-store experience. In recent years, we have been working with innovative C-Store brands who are focusing on building their profitable food and beverage businesses. In the USA, some C-Stores are actively and effectively competing with large QSR and Fast Casual restaurant brands. Because of our decades of experience in these restaurant channels, we bring proven solutions to C-Stores building their F&B business.
Millennials and Technology are two areas in which petrol and convenience retailers must focus on in order to stay relevant. What sort of strategies would you suggest they should focus on?
Technology is an integral part of Millennials’ everyday lives. They expect it everywhere and they use it continually. So leveraging technology is one of the areas that C-stores need to address to remain relevant to this customer base. Brands that embrace technology will be more popular among Millennials. C-Stores should be active across all social media platforms and offer different benefits for “following” them on each one. Look for ways to leverage technology in the store as part of a visual merchandising strategy (touch screen ordering, tap and pay technology, etc.).
But technology is not the only thing that’s important to Millennials. It’s clear that Millennials seek out and favor brands that deliver distinct qualities. It isn’t necessarily the name of a brand that draws them in, but rather the retail environment and overall customer experience. By leveraging technology and some or all of the below strategies, C-Stores can better attract Millennials, differentiate their brand, and grow overall business.
Millennials seek the “wow” factor. They love retail environments and experiences that are unexpected and remarkable. They crave the joy of adventures and discoveries and view commerce as an opportunity rather than a burden. Millennials seek out thrills and long for an experience that will give them something to talk about and share with others. C-Stores should be surprising and innovative when it comes to the look of the environment – the way a store is shopped. The overall experience should be unique, wonderful, fun and surprising. This not only differentiates a brand, it creates the unexpected and valued “wow” factor that Millennials crave.
Millennials want to feel entertained. They view shopping as social and a form of entertainment. Brands should be engaging and entertaining. We call this “retailtainment”. Include in-store communications that anticipate customer needs, and thatare educational, informative and help customers shop and compare. Use visual merchandising that is engaging and highly interactive. A study by Infographics Media showed that Millennials are 216% more likely than other generations to be influenced by a store’s interactive touch screen displays.
Millennials want to be well educated and informed. Unlike baby boomers, who have long exhibited consistent brand loyalty, 57% of Millennials are comparative shoppers. Brands should be educational and informative. The more information that is available, the better the chances of appealing to Millennials. Customers should be given enough information about a product to make a wise shopping decision (how it compares to others, what are its key features, where is it sourced from etc.).
Wellness is a daily active pursuit. Many Millennials exercise more than their parents did at their age and live active lifestyles. They are twice as likely to care about whether or not their food is organic than non-Millennials. C-Stores should be health conscious. Food and beverage offerings need to respond to this need. Brands that give off a healthful vibe will likely be more popular than those that don’t. We are seeing a trend in made-to-order gourmet sandwiches.
Millennials care about the greater good. They care about more than just political and ethical issues. They are attracted to brands that are genuine and authentic. Millennials go out of their way to find brands that they can respect or relate to. They are concerned with a company’s beliefs and behaviors. More than 50% of Millennials make an effort to buy products from companies that support the causes they care about and are more likely to question a company’s ethics.
As it relates to a C-Store’s fresh food offerings, be sure to source local foods to reinforce “sustainable, fresh and local”.
Howland, during your keynote at the AACS Leadership Summit, you focused on the benefits of having a drive-thru offer. Could you give us a brief outline of these benefits and your top tips for retailers looking to add a drive-thru to their store?
If C-Stores are serious about growing food and beverage sales, and if they intend to compete with QSR and Fast Casual brands, then the inclusion of a drive-thru is paramount. For most QSR and Fast Casual brands, sales at the drive-thru account for 50-70% of their business. Why? Convenience. Consumers demand convenience. The drive-thru is a proven way of delivering convenience as it relates to foodservice. As to my “top tips”, I have three biggies to offer:
- Learn from successful QSRs and Fast Casual brands what works and what doesn’t work at the drive thru. There’s a half century of lessons learned out there. Copy the best-practices shamelessly.
- Don’t try to sell everything at the drive-thru. Limit the drive-thru to food and beverage sales. The logistics of trying to include other items in the C-Store are impractical.
- Don’t just glue the drive thru onto an existing store. The drive-thru is more than a hole in the wall from which customers place and receive orders. To do it right, you must invest in thoughtful layouts, optimised operations, new equipment, additional personnel and drive-thru specific customer communication and merchandising.
What are the most important things retailers should be thinking about when merchandising their C-store?
Retailers should start thinking in terms of “Customer Zones”. The most successful retail concepts have recognised that their stores are not just branded boxes. Each store is actually a collection of many individual “customer operating zones”. Customers behave differently in each zone. Their needs and expectations are different. Their retail experience is different from one zone to the next. Each of these unique zones is right for one merchandising strategy, and dead wrong for another.
By identifying these zones, understanding how customers behave in each zone, and establishing specific business goals for each zone, we can craft zone-specific merchandising strategies that are responsive to how customers use these zones and which are designed to achieve specific business objectives. This makes the customer experience faster, easier, and more enjoyable, while distinguishing your brand and maximising business results.
The concept of developing merchandising and communications strategies based on “customer operating zones” was pioneered by King-Casey decades ago. This blend of science and creativity is used to help retail stores manage the entire customer experience. A curb-to-curb journey. The acronym “COZI®“(Customer Operating Zone Improvement) captures the methodology used by leading retail concepts.