With about 1.5 million convenience stores worldwide—and an immense amount of creative operators—there’s a huge opportunity for retailers in the United States to learn from their counterparts abroad.
“Convenience stores around the world are facing the same issues,” Mark Wohltmann, director of NACS Global, said at the 2024 NACS State of the Industry Summit. “NACS is all about knowledge, connections and advocacy, and that is what NACS Global is trying to support. By reaching out to our network around the world, we learn what is happening elsewhere, connect with the right people that are driving our industry forward and learn from policy issues.”
EV Charging Innovation
Car manufacturers have traditionally led the way in creating EV charging infrastructure, but there’s a growing need for retailers to step into this space and offer more than just a place to recharge vehicles.
“Car manufacturers, especially Tesla, out of a lack of anything else existing, are creating their own charging parks,” Wohltmann said, noting that these charging stations often just consist of a room with a vending machine for customers to get a snack and sit at a table to relax.
“They are not experts on hospitality. They are not experts on convenience retail sales. This is a lost opportunity and a threat to convenience stores,” Wohltmann said. “We need to make sure that wherever EV charging takes us, we as an industry will be there as well.”
Our store becomes way more than a store.”
GRIDSERVE in the United Kingdom is working on an EV charging-only forecourt—instead of fuel pumps, there are only EV chargers for customers. The building behind the chargers looks like a large c-store, but inside a different scenario emerges—the building has a classic convenience store but also a café, a gym and even a small meeting area to cater to the longer dwell times of EV charging customers.
“The needs of the EV customers are different than fueling customers,” said Wohltmann. “We need to think about what is it that the customer needs and what we can offer them in those 35 minutes they spend on site.”
Wohltmann shared that “if you ask the retailers in Norway [which leads the world in EV usage] what is it that EV charging customers want? Do they want to go into a store to buy a coffee? Do they want entertainment? Do they want to be left alone to sit in their car and answer emails? The answer to that is ‘Yes.’ You have all of these customers … That means we need to change what we’re offering and how we’re offering it. Our store becomes way more than a store. It becomes a hospitality environment. It becomes an entertainment environment. We will be in a very different kind of business—in some amount of years—in some locations.”
Repsol, a company based in Spain, debuted a store concept where the store is in front of the forecourt. The store is sleek, modern and high-end. “It’s not gas station first, it’s experience and hospitality first, and by the way we also sell fuel somewhere over there,” Wohltmann said.
‘Theater of Fueling’
Hospitality and convenience are converging, and that convergence is gaining in momentum. Wohltmann talked about the “theater of fueling,” a way to add excitement to one of the most mundane tasks for vehicle owners—fueling up. “Consumers today want more and more in retail—not just buying a product, but getting an experience,” Wohltmann said.
“People are paying for experiences. What is your main product? It’s fuel. And what’s the most boring thing you sell? It’s fuel,” Wohltmann stated. “What can we do to keep the fueling customer? We give them something back.”
In Columbia, Terpel was the first brand to build locations specifically for motorcycle fueling, using special equipment that makes filling up a cleaner, easier experience. Why? In a country where 65% of the vehicle fleet is motorcycles, the company was able to tap into an underserved market and create an improved, special experience.
Motorcycle drivers enter the fueling station through a gateway that evokes a motorcycle race and that is too small for a car. “They’re the first ones to do something specific for their biggest target group … Now ask yourself the question: Who is your biggest customer group?” asked Wohltmann.
Looking to the Netherlands, Wohltmann pointed to Loogman. Drawing from its carwash experience, the company created an experience that has customers lining up and that Wohltmann called “totally nuts, completely bonkers.” The brand introduced a fueling experience where the car moves slowly forward on a conveyor belt with a moving fuel pump and attendant. “Does that make any sense? No. It makes absolutely no sense at all,” Wohltmann joked. Functionally, it’s just a normal fill-up. But the experience is the point, and it’s working.
In-Store Hospitality
Oil companies are also expanding into hospitality, transforming traditional petrol stations into multifunctional destinations offering food, beverages and entertainment. Companies like PTT Oil in Thailand and Shell have successfully ventured into foodservice, establishing coffee chains and standalone cafes. Wohltmann said the key to success lies in authenticity and maintaining quality offerings, as shown by PTT’s Cafe Amazon rising to become the sixth-largest coffee chain globally.
Shell also expanded into hospitality and is changing perceptions with Shell Café. The oil brand has launched standalone coffee shops around the world.
Convenience stores around the world are facing the same issues.”
In Germany, where there are 14,000 gas stations and 40,000 bakeries, wholesaler Lana developed a bakery program for gas stations. Within the store, a gas station attendant and bakery shop server are separated by a wall, with completely different aesthetics on each side. Knowing Germans’ attitudes toward baked goods, the brand created an authentic, quality program to give consumers a more appealing experience at the gas station.
7-Eleven in Denmark makes more than 35% of in-store food and beverage sales from healthier-for-you options, showing that customers who say they want healthy options yet purchase the opposite may eventually find their way to healthier-for-you choices. In Spain, under the Spar brand are Spar Natural grocery stores, which have labels that list more than just allergen information, such as including what ingredients fight inflammation or have other health benefits. The staff is trained on the products and there is a consultation room to talk with experts.
“We are moving as an industry further and further away from being a gas station first and a convenience store second … we’ve already become way more than a convenince store that sells fuel,” said Wohltmann. “What we’re seeing around the world is a shift to where the industry becomes a hospitality and foodservice provider first that also sells convenience items and maybe has some fuel.”
Sustainability is also a factor shaping the future of convenience retailing. While Europe leads the way in sustainability initiatives, younger generations in the United States expect more sustainable practices from retailers. Wohltmann shared that Spar grocery stores in Norway have solar panels on the wall and floors that create energy when walked on. More importantly the retailer makes their sustainability efforts known: “They tell everyone how green they are,” said Wohltmann. “Make sure whatever initiative you have, you communicate it well for consumers.”
25 cameras on the ceiling … capture the current in-store demographic.”
Consumer Customization With Technology
AI-powered digital displays allow retailers to tailor advertising based on demographic and mood analysis, creating a more engaging shopping environment. In South Korea, GS25 convenience stores have a column in the store with digital screens on all four sides showing advertising. There are also 25 cameras on the ceiling that capture the current in-store demographic so that the screens will show targeted ads.
For example, if a woman enters the store, advertising for champagne may appear on the screens. Next, a man enters the store and beer advertisements launch. If it’s raining outside, perhaps an uplifting message plays, getting customers in a better mood. Technology that is available today can identify the demographic, establish moods and then customize advertising.
Amazon may have taken a step back on its Just Walk Out technology recently but Wohltmann says unmanned technology overall is on the rise. While it will not replace convenience stores completely, the experimentation is leading to hybrid models that have different store environments (staffed or unstaffed) during different parts of the day. Poland’s Zabka is Europe’s largest operator of unmanned stores, operating 70 locations.
Consumers are looking for ultra-personalization, which is made possible through technology advancements. At Vita Mojo restaurant in London, the self-ordering system allows customers to customize their meal ingredients and summarizes the macronutrients—not just the calories, but also the amount of fat, protein and carbohydrates. Then, a consumer can reduce the calorie amount if desired, and the system automatically adjusts the meal. The kitchen gets a list and exact measurements to make the personalized dish.
Urban Density
In the United States, the 1920 census marked the first time that a majority of the population lived in urban areas. Globally, a majority of the world’s population were city-dwellers starting in 2009. As c-stores evolve to meet this reality, new ideas are coming to the forefront for how to cater to customers who live in small housing units. “A really dense, urban population has different needs, but that’s where we’re headed towards,” said Wohltmann.
Wohltmann shared his experiences in Seoul, South Korea, where convenience stores are adding a few washer/dryer machines as a traffic driver. Some residents of the Korean mega-city lack full kitchens in their units, and c-stores are stepping up by offering more meals to go.
CU (a Korean convenience store chain) partnered with Hana Bank. “The bank realized, ‘hold on, we’re just doing online banking. We don’t have branches anymore. We’ve kind of lost our connection with our customer.’ The convenience store chain said, ‘well, what else can I do in my store to get my people in?’” The result was a location that combines a c-store and a mini-bank, which mainly consists of “a fancy ATM as well as some seating and an office. There’s only a bank person for about an hour a day … The rest of the time, the bank section is a seating area for the convenience store,” said Wohltmann.