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Convenience Capitalises on Its “On-the-Go” Advantage through Channel Innovation in Australia

August 8th, 2017

Aware of time pressures in trying to achieve a positive work-life balance, Australian consumers are increasingly rewarding retail formats that take the stress out of day-to-day shopping. In response, a growing number of local businesses are leveraging various aspects of one-stop convenience that can be incorporated into the retail experience.

The convenience channel, convenience stores and forecourt retailers, are particularly well-placed to tap into consumers’ desire for speedy and simple solutions. Yet it’s not just about the pace of service delivery. Australian consumers are largely cautious when it comes to discretionary spending, but can be coaxed into parting with their hard-earned for novel concepts that embrace premiumisation, healthier living and the all-important, barista-made coffee.

Thus much note-worthy innovation in grocery in recent years has been driven by forecourt retailers and convenience stores, as they experiment with new concept store formats, adding new services and products such as coffee, fresh fruits and juices and food for in-store consumption.

For example, On The Run Pty Ltd opened a new 24-hour convenience store in May 2016 that offers locally-roasted barista-made coffee, a designer seating area and incorporates foodservice providers Brumby’s Bakery and Moe’s Dog & Shake. In June 2016, Puma Energy launched 7th Street, a café concept rolled out in selected stores across their network. As in the case of On the Run, the 7th Street café concept offers customers barista-made coffee, fresh food and a seating area, as well as free Wi-Fi and recharging stations for mobile devices.

More recently, Caltex Australia Ltd, the third-ranked player within the convenience stores fast food category, is accelerating its own forecourt retailer concept-store strategy, with the announcement that it would open as many as 30 outlets of its new-look retail offering, The Foodary. Launched in February 2017, The Foodary is a food and services convenience hub with modern interior design, a store-within-a-store Sumo Salad foodservice counter, barista-made coffee and services such as laundry, parcel collection and meal kit deliveries. The concept offers customers as much, or as little, retail engagement as they desire, with the option to pre-order food before refuelling via the store’s mobile app, or even to skip the whole in-store experience, paying for their fuel on-the-go via the app.

Looking towards the future, the performance of small format grocery outlets, such as convenience stores and forecourt retailers, will largely depend on the success of such recent innovations. Retailers focusing on providing a one-stop-shop for consumers, with an emphasis on driving frequency through fresh and flavoursome food offerings and premium coffee are likely to continue to experience growth in Australia in the short-term.

 

New concepts in convenience – and more – will be further explored at the Convenience & Impulse Convention & Expo 2017 to be held 23-24 August 2017 at the International Convention Centre Sydney, Australia.

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Bettina Kurnik

Bettina is a senior research analyst, specialising in retail and travel, with over six years’ experience at Euromonitor International. She holds a double Bachelor of Arts in Communication (Social Inquiry) / Bachelor of Arts in International Studies (Russian) degree from the University of Technology, Sydney.

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