Leroy Kelsey:
Hi, Chrissy. It’s a pleasure to be back on.

Chris Blasinsky:
Yes, you are a frequent guest.

Leroy Kelsey:
I appreciate the opportunity. Anytime I can talk about the channel and what’s happening, especially when there’s so much anticipated excitement in terms of reconnecting. I think our customers are looking forward to our peak season, which is coming up.

Chris Blasinsky:
Yes. Our summer drive.

Leroy Kelsey:
Absolutely. As we come out of what I would call peak season in terms of the winter or COVID cases and issues with health in general, I think that people are ready to get mobile again and reconnect. So I’ll talk about some of that and optimism.

Chris Blasinsky:
We saw some of that optimism coming out of the pandemic in 2020 at our NACS State of the Industry Summit when we revealed all of our financial and operational performance metrics, including the presentation that you gave, which is our program called Convenience Voices. You’ve been working on that program for while. You’ve been doing this for well over a decade, so you’re a wealth of knowledge on how convenience store shoppers think, the path to purchase, they’re purchasing decisions, where they make them and what they ultimately do. I got to see you sweating bullets a little bit putting your presentation together but you always do a phenomenal job on stage. So we know that every customer is on a path to purchase.

Leroy Kelsey:
Yes, absolutely.

Chris Blasinsky:
What do we know specifically about our convenience store shoppers? Do they walk in the door already knowing what they want? Is it premeditated? Where do they make these decisions? What is the data or the research telling us?

Leroy Kelsey:
As you know, one of the things that makes us unique as a channel is that 80% of what we sell gets consumed within the hour, and 65% before the customer even leaves the parking lot. So they’re already sampling the products as they leave. And I think that immediacy is one of the reasons why we chose mobile intercepts to talk to people. We wanted to capture that retail moment of truth. When we talked to our colleagues in the convenience industry at the State of the Industry Summit this year, I stressed that there are four shopper trends that need to be shaping their strategy. And you just touched on one of those, which is we believe that digital is going to continue to influence every stage of the customer or the buyer’s journey.

Leroy Kelsey:
I spent some time talking about the details of that. And one of the things that I thought was most interesting is when you look at where shoppers decide to purchase and we ask them, you’re here today, where did you decide to purchase? Was it before they left? Where they’re coming from? Was it before today? In other words, was it a premeditated purchase decision or was it en route. So while they were driving or walking or once they got to a location where they could actually see the store. Maybe they’re not there, think about our signs that are very transparent. We uniquely show our prices on our signage even before the customer gets onsite in terms of fuel. Or was it onsite in the forecourt, in the parking lot or inside the store where they made the purchase.

Leroy Kelsey:
And surprisingly only 19% of shoppers, or about one out of five, said, I just decided to make my purchase onsite. So the lion’s share of those purchase decisions actually happened before the customer even left where they’re coming from, or even before that day. So 43% of shoppers said, I made the decision to buy before I left. And so that was a really interesting data point. And what it suggests to me is, when we look at digital, whether it be using our loyalty programs in terms of apps, whether it be geofencing to contactless, or whether it be coupons or special offers that we’ve issued to them, that they can come in and redeem digitally. We think that digital is extending the retail runway. What we mean by that is instead of being restricted to four walls, in terms of that 19% as far as building relationships with your shoppers, you’ll be able to build relationships with your shoppers

Leroy Kelsey:
before that day based on their past experience, you’ll be able to build relationships based on what your brand promises, how they perceive your brand, and also be able to build relationships en route with shoppers as well using digital technology. We really wanted to drive that point home. In fact, whether you’re investing in digital technology to build relationships with shoppers in that premeditated stage or that en route stage, those relationships are already happening. They’re developing whether you’re proactive about it or not. The way we illustrated that is we found that 19% of the shoppers we talked to that told us they searched for a product or service on a digital device in order to select the convenience store that they visited today.

Leroy Kelsey:
And so that told us that shoppers are not only very premeditated, but they’re using digital to identify which offers are going to be in their consideration set. Are you famous for a great coffee or pastry that goes with that coffee for the breakfast occasion? Are you famous for a foodservice offer that could provide a great lunch experience for a shopper? So they’re doing the math in their head in terms of what your brand promises and what type of experience they can expect from you, and that runway or that approach to the actual purchase is going to get longer thanks to digital technology.

Chris Blasinsky:
I love that quote. I wrote it down when you said it that digital will expand the retail runway beyond the four walls of your store. When we started at NACS in the early 2000s, iPhones were just getting their start. So we’ve seen a lot of growth and a lot of opportunity in this channel. And I think today retailers are capitalizing on those opportunities way more than we could have predicted that they would’ve in the past.

Leroy Kelsey:
I agree with you. If there’s any silver lining to retail in having to pivot because of the pandemic, I think that that’s the key. We’ve sped the development curve up and we’ve invested in technology because it was a necessity when we tried to reduce friction between shoppers and being able to make their purchases. But a byproduct of that is we’ve seen shoppers adopt our digital apps and our loyalty at a much higher clip. We’re above 50% in terms of the shoppers that have convenience loyalty on a mobile device. And the beauty of that is when we talk about digital search and the digital relationship, 79% of those shoppers that conducted a digital search did so on a mobile phone. So it really plays into our recent strengths. And there’s a ton of upside in terms of continuing to develop that relationship and make sure our channel remains competitive.

Chris Blasinsky:
And it’s not just the younger generation, right? You found that the baby boomers are heavy mobile users in finding convenience stores.

Leroy Kelsey:
Absolutely. We looked at the digital device that was used for digital search to select stores across generations. And what we found was the pandemic really democratized digital influence across all generations. But there were specific devices that got more traction with specific generations. For example, we noticed that boomers had the highest incidents of using car navigation systems to perform their or search for convenience stores.

Chris Blasinsky:
Because they can afford the cars. Three quarters of the wealth in the country is with the boomers.

Leroy Kelsey:
Exactly. When we look at the buyer’s path to purchase, 39% of their purchasing decisions were made en route. And by the way, they index higher in terms of car navigation. So we can really start to unlock growth opportunities if we implement purposeful placements along that buyer’s journey. If I know that 39% of boomers are going to make purchasing decisions en route, and I know that 18% prefer to do digital searches on a car navigation device, then I can start to give them little reminders like, ‘Hey, stop in and pick up those last minute necessities for your barbecue on July 4th, or stop in and pick up a nice adult beverage to go your occasion to reconnect with friends or family,

Chris Blasinsky:
Right. Grab that four-pack of sparkling wine.

Leroy Kelsey:
Exactly. So that’s going to be key moving forward.

Chris Blasinsky:
I think what you’re touching on is that it seems like consumers are much more intentional with their time and their choices of where to shop, and they’re much better using digital to make those decisions ahead of time so that when they get to where they’re going, they find exactly what they want.

Leroy Kelsey:
That’s exactly what I’m saying. We’ve even seen that, not just in terms of inside the store, but also when people are going to be purchasing gasoline, especially if we see prices increase moving into the summer, which we typically will see a little bit in terms of more expensive blends of fuel.

Chris Blasinsky:
Sure, coming out of the winter months into the summer blends there’s always a little spike.

Leroy Kelsey:
Exactly. So thinking about that, it’s going to be important to communicate to the shop even before they come inside the store. One of the things that we found is that customized promotions can do a great job with communicating value to shoppers in a relevant way. Digital helps with that. The other thing that we found is, there’s a significant number of shoppers that feel like they don’t have enough time to stop. In other words, they typically shop convenience, but they perceive that because they don’t have enough time on this occasion, they can’t actually shop. So leveraging what we would call last mile or ways for shoppers to connect with products. Think about curbside, picking up product or think about pre-ordering products that shoppers can then go inside and pick up…

Chris Blasinsky:
Click and collect.

Leroy Kelsey:
Absolutely. Those occasions are going to help save time and we made significant investments as a channel to upgrade those services because of COVID and allowing people stop in and connect with product in unique and new ways. And that’s going to continue and that’s a great strategy for us to use for those time-starved folks.

Chris Blasinsky:
It kind of comes full circle, right? Because our older time metrics study, which was done quite some time ago, no pun intended, showed that it took a customer about three minutes and 33 seconds to park, get out of their car, do what they need to do inside the store and make the purchase and leave. That’s not a lot of time. So now we’re even more time-starved than that under four-minute timeframe.

Leroy Kelsey:
You’re right. And we’re uniquely focused-based with that. When you look at future consumption like grocery above 40 minutes on average, it’s a different type of challenge in terms of getting feedback from the shopper. We have a very finite window to get the type of feedback that we need to continuously improve and to raise the profile of our overall experience.

Chris Blasinsky:
Experience is the key, right? Is the experience at the store because, hearkening back on the good old days when you and I started at NACS, the age-old question has always been how do you get the fuel customer inside the store? Because they’re missing out on great shopping opportunities for food, for new products, new packaging innovation, all the stuff that our channel has a great opportunity and luxury sometimes in being first market with. And if you’re so time-starved that all you can do is get gas and go away, the customer is really missing out on all the great things that are happening inside the store.

Leroy Kelsey:
Absolutely. And not just with time but also with their budget. A Higher percentage of shoppers are telling us they aren’t coming in to shop on occasions because they’re on a limited or strict budget or because they perceive that the products inside store are expensive. So we’ve always had a premium associated with the convenience that we deliver. And so for some shoppers, they want to connect with products, but they perceive they may not be able to. One of the things that we think is going to be a good strategy moving forward for those folks that are on a limited budget is communicating custom promotions, discounts, rewards, things that communicate value to shoppers. A couple of fun facts: 30% of shoppers noticed promotions while visiting convenience stores, and 15% of those noticed promotions were receive via mobile.

Leroy Kelsey:
So, the shopper will be actively looking for value. We have traditional ways to communicate value on the forecourt, whether it be pump screens, pumptoppers, bollard signs, all types of different ways. But we have some new ways as well. Thinking about that digital runway ways we can take advantage of customization. 71% of shoppers also said they would likely purchase a private label or value brand from the convenience store that they’re shopping. So without taking focus away from the core and national brands, there are opportunities for appropriate value brands or private labels to play a role as well to communicate.

Chris Blasinsky:
I want to go back to the word experience because you touched on something during your presentation around gas prices. We know that historically people will shop for gas based on the price. There’s no other ,that I know of, retail channel in the world that posts their prices on the street so you can either say that’s great or you can keep driving. The Convenience Voices research found that 31% of fuel shoppers are selecting a site on price only. So that’s not the majority. Experience seems to be having some influence on just price alone.

Leroy Kelsey:
I’m glad you touched on that. So that’s pretty impactful because we’ve done research that shows how people will make a left-hand turn across traffic to save 2 to 5 cents a gallon. The point that we wanted to drive home was that price alone will be less of a factor than price as a part or a contributing component of your overall brand. Are you competitively priced and do you deliver consistent service to customers? Do you have quality products? Are you in stock? Do you have friendly staff?

Chris Blasinsky:
Your store clean?

Leroy Kelsey:
Is your parking lot clean?

Chris Blasinsky:
Is your bathroom clean?

Leroy Kelsey:
There are all these touch points that are part of the experience that are key. When we looked at price, price was actually ranked number four in terms of fuel customers that chose a convenience store. But what was interesting is once you got past a distressed trip—I’m running out of fuel, I need to stop in and get gas and this is the closest location—once we got past that, the next thing was familiarity with the location. So this is the brand, this is the type of experience that I can expect based on historic performance, and that was really the key for driving folks into parking lots and into the store. And that’s going to be key moving forward.

Chris Blasinsky:
Leroy, this is the most in-depth and comprehensive research available in our channel. And that’s my bias and honest opinion, but I believe that the data that you guys have collected over the years is phenomenal and a lot of work and time goes into it and a lot of retail and supplier member engagement to make this data what it is. How can our listeners find you and find more about Convenience Voices?

Leroy Kelsey:
If you go to www.convenience.org/voices, you can get to us or search under Research and you’ll find Convenience Voices.

Chris Blasinsky:
Before I let you go, I’m going to put you on the spot for a little bit of trivia. I have a gut feeling you may not know the answer to this. It’s a sports question and you and I are both decent at sports, but this may be the one that we’re not. Here we go. I’m going to give you a question and then you’ll get four options. And if you get it right I’ll buy you lunch. The NBA allows ads on player jerseys. Which NBA team jersey features a NACS retail member ad. Is it 7-Eleven with the Dallas Mavericks? Is it the Atlantic Hawks with RaceTrac? Is it the Oklahoma City Thunder with Loves, or is it the Philadelphia 76ers with Wawa?

Leroy Kelsey:
I going to go with Dallas Mavericks.

Chris Blasinsky:
It’s actually Oklahoma City Thunder.

Leroy Kelsey:

Chris Blasinsky:
I knew you and I would both not get this correct but I’ll still buy you lunch because you are one of my favorite people. We’ve been working together for a long time, and we’ll have you on another episode so that we can get delve more into Convenience Voices because it is a wealth of knowledge.

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

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