By Kim Stewart
ALEXANDRIA, Va.—Ahead of the novel coronavirus pandemic, the top-performing convenience stores were clean, well-maintained and focused on fresh, healthy food and quality products, Jose Gomes, president, North America, dunnhumby, shared as part of the NACS SOI Summit Virtual Experience. Now, retailers can fully lean into their roles as essential businesses as they feed and support their communities amid the crisis.
In the session, The Voice of the Convenience Customer: Winning Their Preference, Gomes outlined key markers to watch as the United States progresses through the pandemic.
“We believe that there’s this real opportunity for retailers to lean into this sense of community, to be seen as the centers of food and support,” Gomes said. Think about “how you can leverage that in your messaging, and how you can win the trust and confidence of customers for the fact that you’ve stayed open, that you’ve supported them.”
Gomes outlined three phases of how society is dealing with the pandemic—and indicated that the United States currently is in the transition phase:
- COVID cases and deaths rise
- Price sensitivity isn’t a consideration as people stock up
- Customers treat themselves to wine, chocolate, other discretionary products
- Fewer trips due to social distancing and shelter-in-place orders
- Profound effect on growth of global e-commerce
- Convenience sales start to fall as economy softens
- COVID cases and deaths plateau and begin to fall
- Price sensitivity increases as more households are impacted by job losses
- People consume existing stockpiles
- Perishable mix will increase
- Grocery prices under pressure
- Deflation is possible due to low oil prices, strong dollar and weak economy
- People begin to return to work
- Retailer focus shifts from supply to demand
- Convenience sales could be broadly negative
- COVID cases and deaths decrease significantly
- Most people are back at work
- Travel resumes
- Economy and prices begin to rebound
- Grocery and food prices begin to rebound
- Convenience sales begin to rebound, particularly gasoline
- Price sensitivity will linger until consumer confidence gains
“We expect consumer attitudes to move from this period of real uncertainty right now, to actually move quite quickly through to the higher levels of confidence as the worse is behind us and as people go back to normal lives,” Gomes said. He adds, “if there were for whatever reason, a need to shelter in place again, in the model we would just go back to the beginning of that transition phase.”
Gomes advises retailers to map out their strengths (beverages, foodservice, locations and hours to capture impulse and emergency trips outside of normal hours, for instance) and weaknesses (price perception, cleanliness and healthy food options, for example), along with opportunities (e-commerce growth, drive-thru, people reconnecting with their neighborhoods) and threats (consumers making fewer quick trips in favor of bigger stock-ups, price sensitivity and aggressive pricing by grocery stores).
“The work needs to start now to be able to execute in that transition period, which we expect to be short—anywhere between 6-12 weeks. And then of course the recovery period when that comes in,” Gomes said.
Retailers can offer new and added value for customers—especially at-risk shoppers—with specially priced bundles of goods. At the same time, it’s crucial that retailers support their team members on the front lines of customer engagement by recognizing their work as essential employees and being transparent about things like stock availability, sanitization and product handling procedures so they can inform customers.
“We think it’s an unprecedented moment, but also a real opportunity to reconnect with customers and to build on the community experience,” Gomes said.
(View this session and the complete NACS SOI Summit Virtual Experience on demand by clicking here. Video presentation viewing is available for download until September 1, 2020.)
Kim Stewart is editorial director of NACS and editor-in-chief of NACS Magazine.