Convenience stores offer waves of innovation
ALEXANDRIA, Virginia — In honor of the 60th anniversary of the founding of NACS on August 14, 1961, we look back and forward at how the sense of convenience has evolved.
NACS Vice President of Strategic Initiatives Jeff Lenard explains how there have been three distinct waves of convenience, each coming twice as fast as the last, in NACS magazine’s column, “Making History.” (Read the story in digital pdf or online.) And the fourth wave seems to be here. Here are some of the highlights:
Wave 1: Home delivery: 1785-On
Milk delivery was introduced in 1785 in Vermont, when milkmen roamed neighborhoods with essentially a giant vat of milk, and residents used whatever containers they had on hand to fill.
The strong post-war economy helped spur suburban growth in the 1960s, but the greater distances for travel between customers made traditional milk delivery from a dairy location inefficient. Wood Brothers, a 150-year-old dairy company, needed another distribution option for their milk and opened their first convenience store in 1964, now known as Wawa.
Today, Wawa offers home delivery of almost everything that is sold in stores, including milk. Wawa is one of several convenience store companies with roots tracing back to the dairy industry, and the word “farms” in the name is usually a key indicator, such as Weigel’s Farm Stores, Rutter Farms stores, and Cumberland Farms.
Wave 2: Vehicle Delivery Services: 1913-On
The invention of the automobile created a second “place” for Americans beyond their homes. It ushered in the second wave of last mile delivery – to the car.
Curbside delivery, for example, is a variant of the “carhop”. In 1921, a Texas barbecue joint called Kirby’s Pig Stand pioneered the car delivery concept. Parking spaces surrounded the building on all four sides, and the waiters, called carhops, brought food to people in their cars.
White Castle introduced a different level of convenience with its take-out bag in 1927. Customers could order food and take it to eat later or eat while driving, known as ‘dashboard dining’. . This concept continues to be adopted by convenience store customers today: 65% of items purchased in a convenience store are consumed immediately.
The curbside pickup and carry bag combined create another last mile delivery concept – drive-thru. Many convenience stores are adopting this model, whether for food or other items. Wawa garnered a lot of positive reviews and praise in January 2021 when it introduced its first drive-thru convenience store, a concept that has been around in the industry for decades, even if it looked slightly different.
Wave 3: delivery via mobile devices: 1985-on
Home delivery has always been linked to a device. Originally, the device was a pen and catalog order form, which was mailed to a company. Later, the device most used to place orders was a landline.
In the 1980s, new devices were also introduced to convenience stores. The first is payment at the pump, introduced in Europe in 1982 and in the United States in 1986 by EZ Serve and its subsidiary AutoGas in Abilene, Texas. The dispensers had a built-in credit / debit card reader system.
Convenience is closely related to speed of service and this was also improved at the pump in 1996 when Wallis Companies, a convenience store chain based in Cuba, Missouri, served as a test market for Speedpass. In testing, Speedpass reduced the average refueling time by 30 seconds from three to four minutes. In five years, more than five million customers were considered regular Speedpass users at Mobil, Esso or Exxon brand stations.
Wave 4: Approach?
Looking at the first three waves of convenience, each wave was roughly half the length of the previous one. Convenience continues to advance because consumers value convenience as much as anything in retail, including price. This means that all retailers, regardless of their channel, need to sell convenience.
While this makes the competition even tougher for convenience retailers, it reinforces two long-held beliefs: convenience is king, and those who win are those who can continue to redefine it.
Jeff Lenard is the vice president of strategic industry initiatives at NACS. He can be contacted at [email protected].