CSD: What Will Be the Future of Convenience Retailing?
Through a special arrangement, presented here for discussion is a summary of an article from Convenience Store Decisions magazine.
Looking out over the next 10-to-20 years, one thing is clear. The primary value proposition of the convenience store industry — as with all retailing segments — will have to be radically redefined or the industry will become obsolete.
"Today’s consumers are increasingly living in a world of 24/7 real-time access to a broad range of goods and services delivered through an ever-broadening platform of devices and interfaces," said Ryan Mathews, CEO of Detroit-based Black Monk Consulting and a globally-recognized futurist and consultant. "Old concepts like viewing retailers by channels — and making allowances for channel idiosyncrasies like higher price points and margins — are rapidly become a thing of the past, and it’s therefore unlikely to survive into either future."
One could make the argument that there will always be a need for emergency or last minute purchases, "but this is hardly a formula for a robust future," Mr. Mathews said.
So what might that future look like? "There is an old adage to the effect that he who pays for his food by staring into crystal balls had better be capable of living on a diet of shattered glass," Mr. Mathews said. "I’ll avoid the temptation to become too prophetic here other than to say that in a decade, successful and profitable c-stores will be doing a good deal more with customer-specific data processing. Within two decades the channel — as a channel — will likely be either almost entirely automated or will have ceased to exist."
The question he suggested convenience store retailers should begin asking themselves is: "What is the industry doing to address the potential of what some call M2M (Machine to Machine) marketing facilitated by the emerging and far-reaching capabilities of the internet?"
"For example," Mr. Mathews said, "imagine an interface of your car’s internal temperature control mechanisms and the c-store of tomorrow. On a hot day the onboard telemetrics could receive a personalized message from a customer’s favorite c-store, or one where he already has a loyalty card tracking his sales, alerting the driver to special discounts on cold beverages."
Similarly, a tie-in of weather forecasting, retail intelligence and onboard computers could alert drivers to stock up on appropriate driving aids like windshield wiper fluid and ice scrapers for snow.
While there is no end to questions about the future, Mathews concluded, one thing appears certain. "Unless things change quickly, I’m afraid discussions about the future of the channel may all prove moot," he said.
How do you see convenience at retail being redefined in the years ahead? What will that mean for convenience stores?