NACS Convenience Summit Europe 2018: Technology Helps C- Stores Turn to Fresh Food and Food-Service Offerings - Coresight Research
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June 7, 2018
NACS Convenience Summit Europe 2018: Technology Helps C-
Stores Turn to Fresh Food and Food-Service Offerings
Jan-Willem Dockheer, General Manager at Dutch retailer AH to Go, at the NACS Convenience Summit Europe
2018
Source: Coresight Research
The Coresight Research team attended day one of the NACS Convenience Summit Europe
2018 in London on June 6. Here are our top takeaways from the day:
1) Technology will play a key role in the future of convenience stores (c-stores). In
digitalized c-stores, human employees will be assisted by computer vision and
artificial intelligence (AI) designed to enhance the shopping experience. Unstaffed c-
stores will complement, rather than replace, staffed c-stores as part of companies’
multichannel strategies.
2) C-stores need to meet the expectations of an increasingly curious, demanding and
impatient consumer base. To better serve shoppers, many c-stores are turning into
food-service locations. Shoppers dine in-store and retailers use technology such as
digital displays that show different meal options to adapt stores to different dining
occasions throughout the day.
3) C-store shoppers want speed in general, and 30% of visitors to c-stores located in
public transportation hubs have only two minutes for shopping. Self-checkout and
innovative payment options help retailers deliver faster shopping experiences.
4) Shopper behavior is changing as consumers visit stores more often, and that trend
favors convenience shopping. However, discounters, which provide proximity
shopping, present a competitive threat to c-stores. To ensure future growth, c-stores
should focus on fresh food, which is currently the largest category, and one of the
fastest-growing, in the c-store channel.
Highlights from NACS Convenience Summit Europe 2018
The Coresight Research team attended day one of the NACS Convenience Summit Europe
2018 on June 6. The conference focuses on the global convenience and fuel retail industry
Deborah Weinswig, CEO and Founder, Coresight Research
deborahweinswig@fung1937.com US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 1
Copyright © 2018 Coresight Research. All rights reserved.
June 7, 2018
and is taking place in London June 6–8. Coresight Research Analyst Filippo Battaini opened
the general session on the first day of the conference with a presentation on how
technology will impact the future of c-stores.
Below are our key takeaways from day one of the event.
1. Battaini said that technology will play a key role in the future of c-stores. In
digitalized stores, human employees will be assisted by computer vision and AI
designed to enhance the shopping experience—but human interaction will remain
important. Battaini said that retailers and manufacturers of fast-moving consumer
goods (FMCGs) will use unstaffed, automated c-stores to complement, rather than
replace, staffed c-stores as part of their multichannel strategies. He also expects
more retailers to use unstaffed c-stores to reach underserved areas with lower
traffic, where the cost of running a staffed c-store would be economically unviable.
2. Jan-Willem Dockheer, General Manager at Dutch c-store retailer Albert Heijn to Go
(AH to Go), talked about the innovation strategies the company is adopting. C-stores
need to meet the expectations of an increasingly curious, demanding and impatient
consumer base, Dockheer said. AH to Go is not classifying shoppers in target groups,
but as individuals, he said, and the company aims to target shoppers with a
personalized approach.
Dockheer also noted that c-stores are increasingly turning into food-service locations
where shoppers eat meals. He said that AH to Go uses technology—for instance,
digital screens showing different meal options depending on the time of the day—to
help adapt stores throughout the day. The screens provide different looks for
breakfast, lunch and dinner times.
Presentation showing AH to Go’s Tap to Go in-store payment system
Source: Coresight Research
AH to Go’s management thinks that new technologies should be adopted to help
improve the shopper journey. The retailer developed its strategy based on the idea
that the c-store customer wants speed. According to the company, 30% of visitors to
c-stores located in public transportation hubs have only two minutes for shopping.
To better serve these rushed consumers, AH to Go has developed “Tap to Go,” a
new, faster payment system. Shoppers tap an electronic card or an app on their
phone on a product’s electronic shelf label to pay for the item without having to
scan it at the checkout. The technology has been tested at an AH to Go store located
in the support office of Ahold Delhaize in in Zaandam, Netherlands (Ahold Delhaize is
Deborah Weinswig, CEO and Founder, Coresight Research
deborahweinswig@fung1937.com US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 2
Copyright © 2018 Coresight Research. All rights reserved.June 7, 2018
AH to Go’s parent organization). Tap to Go will be rolled out to other AH to Go stores
in the Netherlands in June 2018.
AH to Go has also replaced staffed checkouts with self-checkouts, and 75% of in-
store transactions are currently self-made by customers without staff intervention.
Finally, Dockheer mentioned how technology helps c-stores focus on expanding their
fresh food offerings and become more sustainable. For example, smart product price
tags can be used to detect when a fresh product is near its expiration and can
automatically adjust the price to encourage purchase.
3. Boris Planer, Chief Economist at research firm Planet Retail, talked through the
economic and demographic factors that shape the c-store market in Europe. An
aging population, smaller homes, lower car ownership rates and increasing
urbanization are all factors driving the need for convenience and proximity, which
favors c-store retailing, he said. Shopping habits have changed and, so, too, have
consumer expectations. For example, consumers expect a speedy visit and options
such as mobile payment when shopping in c-stores. Planer also noted that the
weaker outlook in the grocery market in Europe versus other world regions
encourages retailers to find alternative drivers for revenue growth beyond grocery
retailing. He said that retailers can provide experiences and social spaces in stores,
for instance, by enhancing their food-service offering.
4. Mike Watkins, Head of Retailer and Business Insight at market research firm Nielsen,
provided a macro overview of the retail landscape in Western Europe. Europe’s
consumer confidence is the lowest worldwide, Watkins said, but the good news is
that FMCG sales are projected to outgrow GDP in most European markets. In terms
of the competitive environment in European retailing, the growth of discounters
presents a threat to c-stores, he said. Discounters compete with c-stores by
providing proximity shopping, and they contribute to the growth of private labels,
whereas c-stores still rely extensively on brand promotion as a driver for growth.
Watkins said that shopper behavior is changing as consumers visit stores more often,
and that this trend favors c-stores. To ensure future growth, c-stores should focus on
fresh food, he said, noting that fresh food overtook tobacco in 2017 as the channel’s
largest category, accounting for 19% of total sales. Fresh food is also one of the
fastest-growing categories in the channel, with 5% growth last year.
5. Gray Taylor, Executive Director at nonprofit organization Conexxus, shared some
interesting insights on technology. Taylor said that we are in “Retail 4.0,” a stage of
retail technology development characterized by information and personalization.
The key technologies in Retail 4.0 are big data, the Internet of Things (IoT) and AI.
The IoT exponentially boosts data availability and collection, and AI helps retailers
make use of the data. From the consumer’s perspective, AI is a technology that can
reduce friction in the shopping experience. Taylor said that, according to research
from Oxford University and Yale University, there is a 50% probability that AI will be
sophisticated enough to completely replace human sales associates by 2030 and a
100% probability that this will be possible by 2048.
Deborah Weinswig, CEO and Founder, Coresight Research
deborahweinswig@fung1937.com US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 3
Copyright © 2018 Coresight Research. All rights reserved.June 7, 2018
Deborah Weinswig, CPA
CEO and Founder
Coresight Research
New York: 917.655.6790
Hong Kong: 852.6119.1779
China: 86.186.1420.3016
deborahweinswig@fung1937.com
Filippo Battaini
Analyst
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Deborah Weinswig, CEO and Founder, Coresight Research
deborahweinswig@fung1937.com US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 4
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