It wasn’t long ago when “corporate directive” and “sustainability” would have found themselves in the same sentence, only if that sentence went something like: There will never be a corporate directive to pursue sustainability.

Times have changed.

Shoppers are no longer just consumers. They’re global citizens, continually evaluating corporate behavior to ensure alignment on their environmental, social and governance (ESG) priorities. For convenience store retailers, the movement’s connection to the industry may appear tenuous at best. After all, a store that helps power internal combustion engines is delivering a de facto environmental contaminant but one demanded by necessity. Surely consumer scrutiny will bypass their efforts—or not.

In a proactive effort to assess consumers’ expectations of convenience store operators on issues of sustainability and social responsibility, the NACS/Coca-Cola Retailing Research Council (CCRRC) engaged Shelton Group to conduct market research and offer recommendations for operators seeking to deliver the most impactful programs, actions and communications to reach consumers.

The NACS/CCRRC has a history of understanding and developing practical responses to strategic challenges. Known for providing key industry research, the group identifies the big issues facing convenience retailers and commissions industry research. Since its establishment in 2000, the NACS/ CCRRC has helped hundreds of retailers apply its tools to enhance various elements of their store operations—from growing basket spend among existing customers to broadening their customer base by tapping new business segments.

Timeliness

This year’s study could not have come at a better time, according to CCRRC leadership. “COVID-19 has created both challenges and opportunities for convenience store operators in regard to sustainability,” said Michael Sansolo, research director of the NACS/CCRRC. “During the pandemic, shoppers, our surveys found, viewed local convenience stores as an increasingly central part of their community and an essential retail establishment. But that also means they have a heightened expectation of the role convenience stores play on a wide range of social issues, including sustainability.“

Exactly what those expectations are and how retailers can best incorporate them form the basis of the report entitled, “Convenience Store Customers and Sustainability: The Journey to Creating Brand Ambassadors.”

The Survey

Over the course of seven months, from February to September 2020, Shelton Group conducted a quantitative survey of both frequent and infrequent convenience store customers from various regions and demographics to understand the role sustainability played in their convenience store shopping routine. Using a dedicated research app, Shelton solicited feedback on several sustainability-related issues, including whether the stores frequented provided cues that they were pursuing a sustainability initiative.

Tapping frequent customers was considered particularly instructive, as these are the shoppers who visit a preferred store three or more times per week and revealed a strong preference for stores that implemented ESG initiatives. In the survey, 64% of respondents reported that they are more likely to promote their favorite store to others and are informed about the store’s initiatives.

The Audience

The study categorized frequent convenience store shoppers in four categories according to their level of understanding of sustainability issues. The categorizations are critical for retailers seeking to engage customers on sustainability messaging. The categorizations are not static but indicate a progression of engagements, or journey:

No engagement with sustainability

• Basic: Concerned primarily with business ethics. Data privacy and safety dominate their concerns; sustainability is not part of their focus.

Engaged with sustainability

• Beginners: Comprised of 23% of frequent convenience store shoppers, these visitors are focused on social concerns and want to know that a convenience store is helping the community it serves.
• Deciders: Comprised of 45% of frequent convenience store shoppers, these visitors care about the same issues as beginners but with an additional focus on the products they purchase asthey relate to environmental impact.
• Involved: The remaining 32% of shoppers have an active interest in environmental issues. They seek retailers that have implemented programs to reduce their carbon footprint and conserve energy.

It’s important to provide context for these preferences, which requires an understanding of awareness levels of various sustainability practices.

Twenty-six percent of consumers don’t know whether their store has social initiatives, while 6% know if their store does not have initiatives. Forty-two percent of consumers don’t know whether their store has environmental initiatives, while 10% know that their store does not have initiatives.

Actionable Insights

No matter the size of operation, retailers will find relevant information throughout the report that’s easy to follow, whatever the current stage of their sustainability journey. “Retailers of all sizes can examine those steps to determine how best to engage on this topic,” Sansolo said.

Don’t feel pressure to adopt all changes, though. Sustainability joins a long list of operational priorities for retailers. “Sustainability strategies and goals can mean different things to different companies of all sizes. Our advice is to identify the metrics your company wants to measure, why you want to measure it and create goals that your teams can work toward,” said Lori Buss Stillman, NACS vice president of research and a member of the NACS/CCRRC.

The key is to understand the impact of your actions and ways to reach and engage your target customers. From there, you can balance the ROI (not measured strictly in financial terms) and whether the tactics are practical for your unique circumstances.

High-impact quick wins include those steps that have an immediate impact on frequent customers, such as:

• Two-thirds of customers said that providing hand sanitizer, requiring masks and encouraging social distancing during COVID-19 had a moderate to strong impact on store preferences.
• Diverse hiring demonstrates a commitment to the community.
• Giving back, such as encouraging employee volunteerism and monetary donations to charities, communicates neighborhood involvement.

There are several steps retailers can take to enhance sustainability efforts and increase store and brand loyalty.

• Energy consumption: 47% of Beginners and 65% of Involved customers would promote a store if they knew it uses energy-efficient lighting.
• Product certification: 50% of Beginners and 65% of Involved customers said they would promote a store if it offered products with sustainability certifications (Fair Trade, etc.).

Recycling has a moderate to very strong impact on store choice among more than half of consumers. According to an Eco Pulse Wave survey, more than 70% of Americans feel moderately to strongly responsible to modify their behaviors to positively impact the environment.

To align with customer recycling concerns, the report recommends:

• Offering products in recyclable packaging
• Offering refillable cup and mug programs
• Implementing food waste programs
• Providing recycling bins inside the store and at the pump

A long-term sustainability effort also includes less impactful initiatives that generate a sense of trust among convenience store shoppers with a particular brand. Steps in this grouping include:

• Installing electric vehicle chargers
• Stocking more sustainable products

Spread the Word

Whichever steps adopted, it is important to communicate actions clearly and effectively to maximize consumer awareness and loyalty. “Be ready to tell the story about what your company is doing. Customers want to know that your business supports its employees, customers and the community,” Stillman said.

Talking with customers in their preferred channels, for instance, can help shape your messaging while generating connections with your brand. To accomplish that, consider leveraging your loyalty program and its database of customer contact information to reach your consumers, crafting messaging that details your efforts. Additionally, most efforts will require an active and robust online presence, though involvement comes at a time and resource cost.

Final Words

While previous CCRRC reports focused on store fundamentals as critical to success, they are no longer the sole competitive differentiators, Stillman said. “Today’s customers are looking for companies with a purpose.” And for that, sustainability initiatives, when communicated clearly, can be a compelling selling point.

“Convenience stores are essential businesses because of what they do and not just what they sell,” Stillman said, quoting Don Rhoades, vice chairman of the NACS legislative committee and president and CEO of Vancouver, Washington-based The Convenience Group. “Insights from this report can help retailers tell their sustainability story and deliver a message of purpose and service to their communities,” Stillman said.