New Convenience Stores Push Grungy Standalones

With new brick-and-mortar and digital competition, convenience stores can no longer afford outdatedness or grunginess.

The number of convenience stores is rising in the United States, as the National Association of Convenience Stores (NACS) noted this week in its 2023 NACS/Nielsen Convenience Industry Store Count report. The 150,000+ locations in operation in the country mark a 1.5% increase from last year, a finding that is especially notable, seeing as it comes on the heels of four years of decreases.

Many of these new stores are more upscale locations that offer more than just gas-station-side snacks and beverages. For instance, Getty Realty announced last week that it invested $44 million into nine store acquisitions throughout 2022. Meanwhile, 7-Eleven is modernizing its stores with omnichannel convenience, building out its on-demand delivery infrastructure with its 7NOW delivery app and 7NOW Gold Pass free delivery subscription.

Additionally, convenience stores are now competing with digitally native players such as online-only convenience hubs from restaurants and eCommerce brands branching into brick-and-mortar such as Foxtrot Market, which provides a sleek, upscale in-store experience. Consequently, consumers are coming to expect more from their convenience stores — selection, convenience and digital connectivity.

Research from PYMNTS’ recent study “The Instant Payments Transformation Guide: Grocery, Pharmacy and Convenience Retailers,” created in collaboration with ACI Worldwide, which drew from a survey of 300 United States and United Kingdom retailers, found that 77% of merchants, including convenience retailers, view digital rewards and coupons as being key to in-store customer loyalty. Plus, 81% said the same of access to mobile apps.

“Modern convenience stores and pharmacies may find themselves in more intense competition with each other and online services,” the study notes. “As an influx of independent, mobile-only online pharmacies and convenience services drive up competition, the savviest convenience stores and pharmacies are driving engagement through features that reward consumers for shopping and remove friction from transactions.

Indeed, digital upgrades can go a long way. Last month, Casey’s General Stores, the nation’s third-largest convenience retailer with nearly 2,500 stores, touted its rewards app strength on a call with analysts.

“As of Oct. 31, we were at 5.8 million rewards members, adding over 400,000 members in the quarter, because our team continues to drive value for rewards guests,” CEO Darren Rebelez said. “This has resulted in our rewards participation rate reaching 37.8% which is a 600 basis point increase from the prior year’s second quarter.”

Previously, Casey’s shared with PYMNTS how the industry has some catching up to do when it comes to loyalty programs relative to competing sectors.

“The c-store loyalty space is still generally new in the industry, and the ones that will tell you ‘Well, we’ve had it for a while,’ they’re kind of nascent,” Art Sebastian, Casey’s vice president of omnichannel marketing said in an interview. “Like, hey, there’s coupons and maybe a couple nascent ways to save. So, I think it’s still kind of new. But what I would challenge the industry to do is think about how to … make sure you’re doing something different to have your program stand out.”

PYMNTS Data: Why Consumers Are Trying Digital Wallets

A PYMNTS study, “New Payments Options: Why Consumers Are Trying Digital Wallets” finds that 52% of US consumers tried out a new payment method in 2022, with many choosing to give digital wallets a try for the first time.


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