Thirty-thousand: That’s the average number of new products that enter the market each year, according to Nielsen. 

The number is daunting. But with innovation making up anywhere from 10% to 20% of a convenience store’s set, it’s a critical part of a store’s offering—especially in a channel known for new items.

So, how does an operator decide which new products deserve shelf space? For Derek Gaskins, CMO of Yesway, it’s about taking risks—to a point. “There’s a difference between leading-edge and bleeding-edge: We don’t want to get that far out there,” Gaskins said. “You have to be careful with where you place your bets. I need to make sure anything on the shelves is productive.”

You want to have the tried-and-true, but you want something someone’s never seen.

It’s a valid concern: Only 30% of products launched in the U.S. will grow or sustain their sales in their first two years, Nielsen figures show. Striking the right balance between tried-and-true and new means taking a close look at trends, data and what customers want—all of which was made more complicated with the arrival of COVID-19 earlier this year.

A Matter of Taste

When considering a new product, M.J. Simons, category manager for beverages for the 340-store MAPCO chain in Franklin, Tennessee, starts with a basic guideline. “First and foremost, it’s the uniqueness [of the product],” he said. “Stay away from the same old, same old that everyone else is doing.”

Rachel Krupa, founder of The Goods Mart in the SoHo neighborhood of Manhattan, has very specific requirements for her small, 200-SKU store. The products she stocks have to be non-GMO, with no artificial flavors or preservatives. That’s the baseline. Also, does the product fill a void in her store? After that, it comes down mostly to one thing: taste.

Krupa has a lot of regular customers, and she often enlists them for taste tests as she’s deciding what to stock. Many of those customers (in non-COVID-19 times) are on a break from a nearby office building, looking for an interesting snack.

“We help customers by talking them through what they’re looking for,” Krupa said.

Other things customers are looking for, especially right now, are the brands they know.

“Brand recognition does matter in light of COVID-19,” said Brian Nichols, category manager for nonalcoholic beverages for Salt Lake City-based Maverik, which has 360 stores in 11 states. “It has power right now. People want comfort.”

Gaskins of Yesway, which has more than 400 stores, has a saying: “You win with winners.” If a supplier comes to him with something that’s going to be promoted in a campaign during the Super Bowl? “Of course I want that,” he said.

Because Krupa’s store is what she calls “community-driven,” she’ll stock items customers request. One asked for a Himalayan sea salt variety of popcorn from a brand she already carried, so she brought it in. Her customers also are open to interesting or slightly out-there items, such as mushroom jerky. “You want to have the tried-and-true, but you want something someone’s never seen,” Krupa said.

Tracking Trends

Beyond seeing what’s working for competitors and in the grocery channel, where many trends start, some retailers keep an eye on what’s already trending in their own stores.

Shelley Coleman, category and merchandising manager for Boise, Idaho-based Stinker Stores, which has 111 locations in three states, looks to trends that are already going strong. For example, in the beer category, IPAs are popular in some of the chain’s markets. “So if someone is presenting a new IPA, I know it’s on trend with what consumers are drinking,” she said. When considering if it’s a good fit for her shelves, “I’ll weight it more than something that’s off-trend,” she said.

Nichols of Maverik watches a category’s overall growth trends. “If it’s declining and I’m going to shrink its space, I’m not going to look at a ton of new stuff for that category,” he said. In categories that are growing, such as energy, isotonics and water, he has room for innovation.

It’s optimal if a product has “a little bit of a track record with some history,” Nichols said. He also won’t consider a brand unless it’s been in the U.S. market for at least a year. From there he decides based on brand recognition, the manufacturer’s go-to-market strategy and dollars per point of distribution. He won’t accept a new item unless it’s growing. “I have zero interest in a declining brand,” he said.

“Is it worthwhile taking space away from another category to give it space?” Coleman said. “Make sure your space assigned to each category is on trend for that moment.”

Meet and Greet

When you can’t get in the same room with a supplier or make an appointment at a trade show booth, finding out what’s coming can be a challenge. These days, products are being shipped to Gaskins of Yesway at his home; from there, he’s distributing them to co-workers (or sometimes neighbors) to get their opinion. Nichols goes into the office once every few weeks to sift through all the products he’s received. Coleman said she’s doing countless Zoom calls, which she called inefficient compared to walking around a trade show.

It also has become more challenging to find lesser-known suppliers. To help Yesway with that, the company enlisted the platform RangeMe to find new products from small startups. RangeMe has a global database of 175,000 suppliers. “If we’re looking for a new specialty item like a gourmet snack, fresh food or product good for our own brands/private label, it helps with that,” Gaskins said. “It helps on both sides: Suppliers develop a profile, and I can vet the company.”

Krupa of The Goods Mart asks suppliers that are interested in being included on her shelves to fill out an application. It asks questions such as why the company was founded and if it is committed to being an environmental steward.

Earlier this year, she did an audit of her brands and discovered that only three of them came from Black-owned businesses. Krupa put out the word to her network that she wanted to find more Black-owned brands to stock, and now she has 22. A happy coincidence of that, she said: The majority of them are also female-owned.

Space Invaders

Regardless of whether a category is growing, sometimes it just comes down to whether there’s room for one more. To that end, some retailers have found shippers to be effective.

“When you can set up a nice shipper that you don’t need a degree in cardboard engineering to set up, that can really help new products,” said John Archer, co-owner of Shell Food Mart in Hinsdale, Illinois. “It’s good exposure, and the customer realizes there’s something new.”

Coleman of Stinker Stores agrees, as long as the right product is on the shipper. “If it goes on a crazy promotion, it’s a good secondary location for the product,” she said.

No matter the placement of the product, Simons of MAPCO finds it hard to effectively promote it when the packaging or messaging doesn’t work or doesn’t resonate. “A lot of products really don’t call out on the packaging what customers are looking for,” he said.

“Sometimes, especially with new products, I look at the packaging and think, ‘Why did they think this was a good idea?’” Archer said. “It’s either too plain or too much.”

Krupa’s relationship with her customers allows her to help a product overcome unfortunate packaging. She’ll keep the item on her shelves if she and customers like the taste, but she’ll educate customers on the product, and she’ll also give feedback to the supplier on the packaging.

Exit Strategy

Muddying the waters in the time of COVID-19 is a problem that’s good to have: Because some consumers are avoiding or cutting their trips to grocery and other large stores, some of the stops for fill-in items are spilling over to convenience stores.

But when most of the store is selling well, what do you cut to make room for the new? “In previous years, you’d run the reports and see what’s working and what’s not,” Simons of MAPCO said. This year, “It’s going to be tough to make that distinction.”

Nichols of Maverik will give a new product a full year. “It gets the benefit of the doubt for the first year,” he said. But if it’s still not doing well after two cycles, “it’s time to look at moving on.”

Archer of Shell Food Mart has a credo when it comes to his shelves: “Don’t allow the dead to take over.” It’s critical, especially for smaller operators, he said, to keep track of new items: Don’t let it stay there until it’s out of date and then you have no choice but to replace it with something else.

Keep Calm and Sell On

In a normal year, a common refrain in the c-store industry is the dreaded “new product fatigue.” (One retailer interviewed for this story said he wouldn’t be surprised to see broccoli-and-cheese-flavored candy someday.)

But as with everything else this year, nothing is normal. At least two of the retailers interviewed cited innovations that were slated to arrive—and then didn’t. A few cited a lack of focus from manufacturers on new items. Others said they have seen products roll out with little advertising and promotion behind them. They want to know what’s going to happen. Will the product be reintroduced? What’s the plan?

Simons of MAPCO said some of the products he’d been expecting have been pushed back to 2021. He’s hoping for more innovation next year.

For Coleman of Stinker Stores, being deemed an essential retailer—and enjoying the sales associated with that—goes only so far. She’s been happy to keep her shelves stocked, but she still wants the innovation for which c-stores are known.

“Innovation was always such a big thing, and that was incremental dollars to our bottom line—and we’ve had to learn to live without that,” Coleman said.

Especially concerning to her: What products did she and her customers miss out on this year without that innovation?

“Retailers don’t know what we don’t know,” she said.