The future of the convenience channel

LAS VEGAS – Americans between the ages of 13 to 29, also known as Gen Z, represent an estimated $6 trillion in convenience store spending over their lifetime, according to data presented by Jason Zelinski, vice president for retail-North America, NielsenIQ, Chicago. The young shoppers gravitate to convenience stores to spend their discretionary money on products that would not be readily available at home, items they or the gatekeeper do not stock during planned grocery shopping. Such items include energy drinks, protein bars and candy.

He added that Gen Alpha — children currently between 1 to 13 years old — is expected to have a similar influence to Gen Z once they start earning an income; however, they should already be on the radar of marketers, because the youngsters already know exactly what they want when they enter a convenience store.

Zelinski moderated a panel that focused on how Gen Z and Alpha will impact the future of convenience stores.

“They want what they want,” said Doug Yawberry, a panelist and president and chief executive officer of Weigel’s, a convenience store chain based in Powell, Tenn. “They’re very decisive in their product selection, so you’ve got to have what they want.”

The session included video-taped interviews with Gen Z and Gen Alpha consumers. Their comments emphasized the importance of convenience stores, especially when many live in households where groceries are often delivered. The impulse items they want are not at home, so the convenience store has become a destination for many. One Gen Zer said she expects the convenience store where she stops to have many flavor options of Monster-branded beverages to satisfy the taste she is craving that day.

That’s no easy task, as convenience stores are small-format retailers with limited space. They recognize the need for variety, but it’s a balancing act. Accommodating changing consumer tastes makes limited-edition offerings with special displays attractive merchandising options.

“We have to be a lot of things to a lot of people,” said Crystal Maggelet, CEO and chair of FJ Management Inc., which owns the Maverik chain of convenience stores, and is headquartered in Salt Lake City. “Young shoppers are constantly seeing variety on social media, and they want to try it. We need to offer it in our store, and quickly.”

This is where real-time category management becomes a powerful tool for both retailer and brand.

“There are so many trends out there,” Maggelet said. “You have to provide variety with all of these different brands and flavors and tastes to meet the consumer’s desire to always be on trend.”

Real-time category management is critical for both retailers and brands seeking to succeed in the convenience channel.

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An opportunity for convenience store growth is foodservice. Gen Z and Gen Alpha have always known convenience stores as another option to fast-food restaurants for breakfast, lunch and dinner, whereas older consumers grew up with limited convenience store menus, namely nachos, hot dogs and occasionally pizza slices. Today, convenience store menus include made-to-order poke bowls, automated smoothie machines and hot food bars.

“I predict we are going to see a lot of growth with the younger generation,” said Frank Gleeson, president and CEO of the National Association of Convenience Stores, Alexandria, Va. “They expect variety because they’ve traveled all over the world.”

Gleeson’s assertion supports what Suzy Badaracco, president of Culinary Tides Inc., Oakland Park, Fla., said in the education session titled “Food and beverage trends shaping convenience in 2027.”

Convenience, emotional reward, exploration, value and wellness are all shaping buying decisions as we head into 2027, Badaracco said. Consumers, especially younger ones, continue to explore new cuisines and ingredients, presenting innovation opportunities for food and beverage formulators that cater to convenience.

Some of the most popular flavor profiles in the convenience channel are based on citrus profiles, chili peppers and global seasonings. She cited hot honey, mango habanero and upgraded barbecue as examples, and emphasized that sauces are a low-risk way to introduce new flavors.

“Innovation should focus on making discovery approachable,” she said.