Convenience Matters Intro:
[Music] You’re listening to Convenience Matters, brought to you by NACS. We’ll talk about what we see at stores and what the future may hold for our industry.

Donovan Woods:
You know, most of us have mobile apps for our favorite stores. Do your customers have your c-store app? Do you even offer a mobile app? You know, c-store customers aren’t just looking for another mobile application to clutter up their phones. They want one that’s intuitive, easy to use and like all things delivers real value. How can you deliver the digital experience they expect, and they deserve? Welcome to Convenience Matters. My name is Donovan Woods with the Fuels Institute and NACS and I’m joined today by my cohost….

Chris Blasinsky:
I’m Chris Blasinsky with NACS.

Donovan Woods:
Chris, today we’re joined by two gentlemen who can help convenience store owners out on all different levels, no matter if you’re a single store owner or if you have multiple stores. And that is by taking that next step in their digital journey. We’re going to talk a lot about that because what I thought was that the digital journey is a lot different than what this company presents. And I think our audience is going to want to hear this. So our guests are Matt Carinio, the VP of Strategy and Sam Herro the Director of Business Development, both are from Hathway. Gentlemen, welcome.

Sam Herro:
Thanks for having us!

Matt Carinio:
Thank you, Donovan. Thank you, Chris, for having us!

Donovan Woods:
Thank you. And you know, first, before we get started, I like to never assume that everyone knows who everyone is, but who is Hathway – can give us any background on what your company is about and how long you guys have been around.

Matt Carinio:
Yeah, sure. So Hathway was started just like many technology companies over the last 10 to 15 years by two college students in San Luis Obispo, California. We’ve been around a little over 10 years, started as a website development company and over the last five years, we’ve focused on the foodservice vertical and most recently in the last few years have expanded into the c-store vertical also. So our services and solutions include consulting, creative and development, as well as loyalty and CRM programs, as well.

Donovan Woods:
Good deal, good deal. And you know, I want to make sure our audience realizes this. I think sometimes when we hear the word mobile app or digital experience, we kind of focus in on what it was like maybe five or 10 years ago when these things were new and they didn’t really meet that. But I want to ask you about something. You did a survey and I’ll go to you, Sam, or Matt, if you want to jump in, feel free, but I’ll go to you, Sam. You did a survey where you surveyed about a thousand convenience store customers. What were some of the interesting things you found or you learn from the responses?

Sam Herro:
That’s a good question. You know, what we found was – and I think this is probably not new news – you know, there’s a widening gap between what customers are expecting and what’s being offered out there. Today’s experiences are being driven by digitally native companies. We did a survey of a thousand customers and we found that less than half are actually using apps. But on the flip side, 84% would actually use an app if it did save time and money. So obviously there is a need and c-stores have an opportunity to fulfill on that need.

Donovan Woods:
I like that. And I think one of the things you said, one, there’s a need, but then you said 84% – that’s a huge number. So, people are used to it. Almost everyone I know has a mobile app…or not a mobile app, but a mobile phone or mobile device. And we use them. I think about not just c-stores, but any store. My favorite stores that I go into, they have to have another platform that feels like, gives the same service, and I know it’s just as reliable as going into the store. Is that what you’re really saying that c-stores should have? Go ahead, Sam.

Sam Herro:
Oh yeah. I was going to say that, I think the expectation now is cross-channel, right? So it’s not just the app. It’s not just the website. It might be a kiosk in-store, but really you’d have to look at the whole digital experience now. And how does that mesh with the physical experience? What we found were shoppers are really looking for features and capabilities that fell into three categories, convenience, obviously, personalization, and ease of use. And I think those all wrap back into what is a c-store industry, what we’re trying to accomplish.

Chris Blasinsky:
I’m glad that you mentioned the physical and the digital compliments there because that’s the basis of a….that is the strategy, right? Like it builds that cohesive whole of what the retailer or the brand is trying to do. It’s not one or the other, it’s not all, you know…and there’s 150,000 convenience stores in the U.S. alone. Four walls. It’s a physical space. So bringing that digital experience, I mean, it is…you don’t want it to get too buzzy to the point where somebody doesn’t know what to do. Digital shouldn’t scare retailers away, right? It is something that anyone can do regardless of store size. And have you found…I guess, how do you talk to customers or what are some of the things that you guys bring to the table to them to kind of let them know like, “hey, you can do this. You can absolutely do this.”

Sam Herro:
Chris, I think there’s a lot to unpack there. Maybe I’ll let Matt touch on a little bit more, a little bit more on the execution side of…strategically how we look at that, but I would tee it up…you know, we talked a little bit about apps. We kind of, we had that in the intro. We were talking about apps, but at Hathway, we like to say that an app is not a strategy. And so what you want to do is take a step back and say holistically, what are my goals and what are we trying to achieve? And then app is absolutely part of that as a tool. But as we were talking before cross-channel, there are many different touchpoints in the journey. And, we talked about that in the c-store space where all the touch points. Well, there are a lot of touch points in the c-store industry, from the forecourt to the inside. So just to tee that up, that when we think of apps at Hathway, we think, okay, let’s back up and let’s talk about the strategy and then we’ll talk about what tools do we need to add into that digital roadmap to get there.

Matt Carinio:
Yeah. Chris, I think some of the things that you were just mentioning, we would kind of describe as the digital maturity model. So Sam and I kind of talked about this pretty frequentlyactually just had an hour-long conversation probably a week ago, nerding out on quite a few things and the digital maturity model was one of them. So one of the things that we kind of looked at is starting with the consumer in mind and also looking at what are some disruptors and influencers within any vertical that we’re working in. So like specifically the c-store space, right? So if you look back at retail, 10, 15 years ago, digital was still relatively new. What’s happened at the society level is there’s been an acceptance within society of digital payments and it’s led to…and during that same period of time, mobile devices have, have become more you know, prolific within everyone’s within everyone’s lives so it becomes more normal, right? So as the foodservice space, as well as the c-store verticals, start to move into this disruptive area as well, they’re starting to become…they’re starting to take advantage of some of the learnings of other vertical industries to accelerate some of these solutions. And so as Hathway, since we’ve worked in the foodservice space and work with 30+ brands and have delivered close to a hundred applications in market, there’s a lot of overlap between what the foodservice space has done the last five years and where the c-store space is currently at and where they want to go.

Matt Carinio:
So that experience for us as a c-store client, there’s a lot of things that you’re considering right now. Let’s try to break things down into something that’s actually doable because one of the things, when you’re very early into a disruptive market is it can be very overwhelming. So understanding where to start is where we help them first. So breaking down something complicated and try to simplify that for them. We have a lot of different tools, systems and teams that are experts in doing that. The second thing is Donovan, like you mentioned, every brand has very specific goals for a variety of reasons that we need to understand the nuances for. And so right now, some, c-stores might be leaning into value of product – of their foodservice product – that based off of price. Others might be leaning into quality of foodservice product. Others might be leaning into the integration of fuel services plus foodservice products. So these are all completely different things that we need to take into account when we’re thinking about strategies so that the rest of the team from the product and our growth marketing organizations can come with the correct approaches to help solve these business challenges.

Donovan Woods:
I’m so glad you broke it down like that, Matt, and not saying that Sam, your answer wasn’t great. It was very well-spoken, but Matt, the way you gave that a little more meat, I say that because, again, we can kind of downplay the idea of a mobile app or digital journey and something that Sam said that I’m going to probably bring up at the end of this, an app is not a strategy. And I think that goes with anything, right? This podcast is not a strategy. It’s a piece of the puzzle of what you’re doing in trying to communicate with your audience. But can we go back just a little bit, because I do want to touch more into those five stages, but let me ask you guys this, from your perspective, I’ll start with you, Sam, if you go into a c-store – let’s go specifically with convenience stores – if you were to go into one c-store that has a mobile app and you go into another brand completely that doesn’t have a mobile app, does it change your viewpoint of that particular organization?

Sam Herro:
That’s a good question. I think that from my opinion, probably. I would look at a brand and think, how are they providing convenience? You know, how are they making my day easier to execute all the functions that I have during the day? And so over time I would start to use the c-store. If everything was equal, I would start to use the c-store that is making my day easier and better and that would probably be the one that is giving me the most options and the most choices to choose where and when I purchase, how I interact with the brand. And so it kind of goes back to what we talked about before is that expectations are really not being set by the convenience store channel. Right now they’re being set other brands who are digitally native. So let’s take Airbnb, your interaction with Airbnb, you get off of that app and you go onto a c-store app. What do you expect? You expect the exact same functionality as the Airbnb app. And so you’re competing against that type of experience. So that’s really where we’re going. And at the end of the day, obviously this last year, we’ve all purchased differently and then different channels. So I think digital is just in the forefront now, and it will continue to accelerate. So it’s important to have an assessment to say, where are we at? We’ll talk about the…I think we’ll talk about the digital maturity model that we have here in a little bit, but I like to use that as a self-assessment tool. You know, I take a look at that and say, okay, where are we at on this model? Let’s take a look and see where we’re at. Where do we think we are? Individually…where do we want to be? And, how do we get there and who do we get there with? So I think those are all…it’s kind of a great way to use it as a self-assessment tool on the roadmap.

Donovan Woods:
I like that.

Chris Blasinsky:
Yeah. Within the maturity model, the first two stages, which are inactive and initiation, I believe you guys say about 90% of convenience, retailers are sitting there, but they aspire to move up obviously and get into that foundational stage. What’s holding them back. I mean, what do you guys find that’s holding them back from taking that next step?

Matt Carinio:
Yeah, just like any industry. I think that the first thing is paralysis-analysis, right? So taking that first step, and in any significant initiative for any company is is a leap of faith to some extent, right? And so I think one of the challenges in the digital age today is the amount of information both vetted and unvetted that is available and that can become very confusing and then start to make decision-makers question their thought process. And so the first thing that we tried to do is, in our communication and when we start forgin, any type of relationship with a brand is to try to make them comfortable and show that we have experience and where they’re coming from. Here’s all the things that you’re probably considering. Here’s the things that you probably need to de-prioritize, here are the things that you probably need to prioritize. So that maturity model of inactive and newcomers is, part of it is they haven’t done anything yet. There’s also a component there of what is their organization experience and their decision-maker thought process of, do they have investment, do they have a digital DNA within their organization? Because if you do, it is probably going to be a lot easier to move through the model faster and to get started faster. And with c-stores, we know that there’s a legacy things within organizations that are difficult to overcome. And so from brand to brand, there’s a myriad of various types of challenges, but we’re starting to do even a little bit more consulting just from the internal organization side, when it comes to transformationa linitiatives and not just thinking about, ‘oh, you need these types of technologies, you need this type of research’.

Donovan Woods:
You said something about the levels and I hear that term a lot when it comes to whether it’s hip hop music or whether it’s sports, there’s always that term of ‘there’s levels to this.’ I don’t want someone listening who has a c-store or it’s within the business at any level to feel as though, ‘okay, I can’t do this.’ When I look at your five steps of digital maturity, there’s a term I hadn’t heard. Or if I, excuse me, if I was the one who was ignorant on it, but the white label to custom experience. Can you explain for those who don’t know that that means like if you’re starting out, why would maybe that white label to custom experience be something that is a good start?

Matt Carinio:
Yeah. So we actually partner with a couple of platform companies that kind of piece together the most underlying technology platforms, which is really the point of sale systems. And so as you start to consolidate point of sale systems through these third party platforms, what they’ve done is they’ve created these out of the box solutions that have certain types of features and functionality that are, used to get get a brand off the ground, especially when it comes to commerce and commerce functionality. What we’ve done at Hathway has partnered with those companies, knowing that there becomes a time that a brand will outgrow, for various reasons, the features and functionalities of those white labels provide as well as the ability to create a more customized branded experience specific to that client in order for them to differentiate against their competitions that might also be using white label.

Matt Carinio:
And that’s really our bread and butter as an agency is extending white labels into semi-custom and custom applications over time. And working with both these software companies are our platform partners, as well as these clients to kind of create a best in breed solution. So what we’re really talking about as a value proposition within our space is accelerating solutions for these brands so that they can get and we can kind of show business impact for them.

Donovan Woods:
And Matt was that the…when I was looking over everything about Hathway and what your offer is, there’s a term you use on each level of that digital maturity journey. I said that technology partner integrations with each step is that…did you kind of explain that there is…that basically saying that there is, for each step, you go through, you guys already have the partners to work with to get them up to speed, is that what that means?

Matt Carinio:
That that’s correct. Right. So we have an e-commerce platform that is probably like step number one, right? And as you start to extend your need as a brand. You know, loyalty programs and the platforms that are associated to supporting that. CRM or engagement marketing programs, or other platforms and technologies that you’ve required. So correct. We have preferred partnerships across those, those various technology stacks that we work with.

Donovan Woods:
And Sam and Chris don’t…I’m talking a lot because it’s actually excites me this idea. I worked on a mobile app for the NACS Show years ago. And at that point, Sam, it was pretty much, we went to a different vendor and they had a cookie cutter thing. And you basically just said, I want this, this, this, and it needs to look like this. We immediately went to the layout. There was no strategy. It was just features that we’ve seen elsewhere. Let’s do these. How did…yeah, it seemed to work, but looking at it now 10 years later probably could have been better. Basically what you guys are saying is, that’s not the way to approach this, correct?

Sam Herro:
Yeah. I would say that like most things that starting with a strategy in mind is probably the best way to approach it. And then you can piece together the best of breed of technology stack to compliment that goal that you have. So, Matt talked a little bit about the white label solutions, great way to get started. We have a lot of partners that have a white label solution, but when you get to that point – I kind of like to call it the twin effect, when everybody has – Donovan, like you were talking about – let’s just add our logo, let’s add our name, a little bit of information and then you have these two boxes to change, whatever you want to change, but it all starts looking the same. So it’s like a twin effect. You know, if you know the twins are in your family, you can tell them apart, but anybody else outside, they have a lot of trouble differentiating between the two. So once you get to that point where you want to use digital as a differentiator, that’s a lot of times when brands would come to Hathway and say, hey, now we’re at that point, we really want to use this as a differentiator and we know that this is the future ad so let’s sit down and let’s talk strategy here and make sure that we have the right base technology in place so that as we grow and get to that, we go from initiation to foundation to acceleration to innovation that we can hit those targets because we have the technology in place to do that. So that when we want to get to the really personalized marketing and really pushing the envelope, that we’re not held back by the technology, but that’s all driven by the strategy that you have in the first place.

Chris Blasinsky:
Yeah. And I think with any digital…well, any strategy really, but especially with digital, like it is a journey, right? I mean, digital, it’s always, always changing and there’s always a new innovation, there’s always something around the corner, and I think with this industry too, I mean, we saw how much, how far folks can go in a short amount of time given the pandemic and how they’ve embraced some technology/digital solutions relatively quickly. If they were fence-sitters, they quickly jumped off. What are you guys seeing is the next level for this industry, or are we really just trying to focus on the fact that we need to get that 90% really up and moving? And either one of you can take that one on.

Matt Carinio:
Yeah, I’ll start. I think that the disruption in the c-store space is kind of twofold. I think at the end of the day there’s legislation in place that’s driving alternative fueled vehicles so it’s directly impacting a significant portion of their traditional legacy business. And you’re starting to see it’s no surprise to these brands, right? They’re super smart. So they’re already starting to put together some strategies to remedy this.In some of your previous podcasts, you talked about a few of those strategies. And one of the things that they’re starting to do is, where do we start to maybe re-imagine the value that we can provide our, our customers. And that’s starting to come into the foodservice space. You’re starting to really see a lot of c-store brands redefining themselves in the future as QSR or fast-casual, or limited-service restaurant-types of organizations and operations, because they have the real estate. There is a brand recognition, they have products and meals for their consumers. And so you’re…the redirection of objectives are starting to change there. So I think that’s the biggest thing. And when it comes to the strategy like you mentioned about the application that you had created 10 years ago – and it still happens today -these are things that are challenged with us like how do we not get to tactic-oriented too early? One of the things that Hathway that we’re pretty obsessed on isn’t necessarily what consumers are doing, but why they’re doing it. So, what is their motivations, right?

Matt Carinio:
And so we start breaking these things down into what environment are they in when they’re starting to interact with a c-store, like how far away, what is their proximity and typical usage of c-stores when they want to go there and interact with them. What type of value exchange are they expecting, are they someone that is…their loyalty is going to be based on price or is it going to be based on the quality of product that they’re getting there? And so these are things that COVID has accelerated, and it kind of changed some of these motivators, so we’re continuing to do some first party research to monitor how these things are changing moving forward into quote unquote, what the new normal is, which I don’t know if anyone really has a great answer for that. I don’t think we’re going to say we do, but those are things that I think agencies like ourselves are always continuing to monitor and to reinfuse into all these strategies with our clients.

Donovan Woods:
Very nice, very nice. And if someone is a small retailer, or if they have multiple stores, it seems like your…the way you guys set it up at Hathway in terms of your digital mapping the digital foundation, in terms of five steps, you have a process in place that is kind of separates you from just being focused on a mobile app. It’s focused on a strategy to actually bring customers not only into the store, but also whether they’re out of the store, but to still have a type of a connection with you as a store owner, or as a brand as one that they want to return to that as a positive experience for them. So for any of our listeners out there, whether they are just a single store owner, or they have multiple stores, Sam, where can people learn about Hathway?

Sam Herro:
Donovan, the best place to learn about Hathway and what we have going on is WeAreHathway.com.

Donovan Woods:
Perfect. WeAreHathway.com, very easy. And gentlemen, again, thank you very much. We appreciate you guys for being on the podcast with us today. Thanks Chris for joining me. And you know, for listeners, remember this, if you don’t remember anything else: an app is not a strategy. I love that saying, it’s perfect. It’s spot on. And Sam, you owned it. I’m going to put it out there for everyone because really taking a reactive approach and waiting to see what your competition is doing Well, as it says from Hathway, it means you’re already behind. So we encourage you to take a proactive approach that will increase your incremental sales and continue to build was most important customer loyalty by setting the bar instead of just reaching it. Thank you guys. And thank you for listening to Convenience Matters.

Convenience Matters Intro:
Convenience matters is brought to you by NACS and produced in partnership with Human Factor. For more information, visit convenience.org.