THE RACE IS ON.
In the sprint for the consumer dollar, it appears the c-store industry is in a position to snatch more sales of healthy grab-and-go items.
C-store sales of energy bars and other nutrition bars, for example, jumped 13% to more than 65 million units for the 52 weeks ending in late August 2004, according to research firm ACNielsen, Schaumburg, Ill. While supermarkets grabbed a larger share of that category at 223 million units, they only moved 0.2% more units than the same period in 2003.
In addition, grocery's sales of breakfast bars during the same period fell by 1.1% and granola/yogurt bar volume dropped by 0.6%, whereas c-store sales of breakfast bars rose 19.7% to nearly 44 million units, and granola/yogurt bar sales increased 2.3% to more than 112 million units.
Convenience stores' move toward healthier grab-and-go items is a reflection of the overall shopping trend: Consumers are buying more food they perceive to be healthier for them, better for the environment, or lower in carbohydrates or fat.
"Over the last few years, we've seen a tremendous growth in energy bars. As far as things like organics, you're seeing convenience stores reflect consumer trends," said Jeff Lenard, director of public relations for the National Association of Convenience Stores, Alexandria, Va.
In the organics arena, Dallas-based 7-Eleven stepped up to the plate last year by marketing several varieties of Lay's Natural chips, made with organic and natural ingredients, on its endcaps. Single-serve bags of Terra Chips, organic veggie chips made by Hain Celestial Group, Uniondale, N.Y., have also received prominent display at the front counter of 7-Eleven stores.
Several other chains and independent operators have gotten involved by marketing Atkins and other low-carb items, and carrying more natural foods and beverages.
"We're seeing a large increase in c-stores coming to us," said Shawn Dean, foodservice sales manager for organic and natural distributor United Natural Foods, Dayville, Conn. "They are coming to us because their customers are asking them for low-carb and organic items."
While c-stores are carrying more organic and low-carb selections, supermarkets still have several advantages in marketing this type of food. They are better identifying and merchandising natural and organic grocery items, offering more healthy single-serve items near the front of their stores -- a prime grab-and-go area -- and educating their shoppers on these new types of foods.
Schnuck Markets, St. Louis, has special labels on its organic, natural and low-carb items, so shoppers can find them more easily. The chain recently added green "Low Carb" stickers to more than 200 items integrated throughout the store.
In addition, Schnuck's overall shopping layout has been altered to make the shopping trip quicker for those who want to grab items and go, said Lori Willis, the 100-store retailer's director of communications. It has added refrigerated glass coolers with sodas, juice and water at the checkout areas of some of its stores. Customers can pay for some items at the deli counter, instead of going through the main checkouts. Similarly, self-checkout lanes have been added. Most importantly, when shoppers come in with questions on organic or low-carb foods, store personnel can refer them either to an employee who is educated on the products, or to the chain's Customer Affairs department.
"More and more of our staff are learning about low carb. We're not promoting a certain diet or low-carb products. It's explaining what things like 'lower in carbs' mean," Willis said.
In addition to verbal education, shoppers can go to Schnuck's Web site to get information on health and diet.
Several other supermarket chains are also better merchandising whole health and diet-related items to cater to convenience shoppers.
Albertsons, Boise, Idaho, has refrigerated coolers with healthy beverages at the entrances to some of its stores. At an Orlando, Fla., store SN visited, three glass refrigerated cases were added near the store's entrance and deli, featuring Snapple's new Snapple a Day Meal Replacement drink for $1.79 each, along with related beverages like vitamin water, Gatorade, water, Lipton Iced Tea, Starbucks coffee drinks and a small selection of sodas.
Publix Super Markets, Lakeland, Fla., also caters to the organic shopper who is interested in convenience, with its Greenwise organic and natural food sections, a separate department near the entrances at some of its stores.
C-stores themselves are adding small natural and organic food sets with natural snacks, such as Kettle Chips and Pirate's Booty, along with nutritional bars and low-carb items. C-stores have added the healthier items -- and transformed their stores in other ways -- to appeal more to the female shopper, supermarkets' primary customer, experts said.
"C-stores are trying very hard to get the female shopper into the c-store, but not lose the male customer. So the newest c-stores are designed to be well-lit and have low-profile shelves," said Ron Coppell, vice president of business development for Eby-Brown, a major c-store distributor in Naperville, Ill.
So, while c-stores still feature staples like cigarettes and beer, they have added fresh fruit, yogurt and other items. Whether those items are big sellers is not the point; they were added to get the female shopper in the door, Coppell said.
As an example, c-store giant BP, which operates 900 gas station-convenience outlets, has transformed many of its stores into the sexier, "fresh" BP Connect format.
Convenience stores are not necessarily the predators, however, solely chasing after supermarket customers, analysts noted. While they have added fresh fruit, diet-sensitive foods and better-for-you beverages, the multi-channel world in which the food industry operates today means that c-stores also have their competitors. Operators have had to step up their game because they are battling almost every type of retailer for the "convenience customer," NACS's Lenard said, noting that even pet supply chain Petsmart has added glass refrigerated beverages cases -- for humans -- at its checkouts.
