The Future of Convenience Retailing in Europe—Aarkstore Enterprise

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The Future of Convenience Retailing in Europe—Aarkstore Enterprise

Introduction

Socio-demographic changes and new consumer trends are combining to create new convenience trends across Europe, and many retailers are already on the path of developing their store formats to capitalise on a growing demand for convenience. In response to varying consumer demands retailers are trialing new concepts tailored to specific convenience needs, creating a broader range of c-stores.

Scope

*Insight into the beliefs and behaviours of convenience consumers covering their shopping habits as well as their cooking and consumption preferences.

*Analysis of retailers and their response to growing opportunities in the sector including store expansion, format diversification and brand convergence.

*Coverage of the key threats facing the traditional convenience retailer including supermarkets’ and discounters’ continued focus on the sector.

*A comprehensive set of recommendations surrounding store expansion, product ranges, private label strategies, in-store services and format customisation

Highlights

European retailers are rapidly growing their convenience store bases as smaller formats outperform ailing hypermarkets. Many smaller formats have been adapted to suit the different convenience trends such as increased demand for food on the go and food service options.

However convenience stores’ growth is not all smooth sailing. The stores face growing pressure from discounters also entering the sector and expanding their convenience offer.Furthermore, the success of smaller formats has pushed more retailers to downsize their stores, further encroaching on the neighbourhood market.

Despite increased competition in the convenience market, established multiples continue to stay ahead of the game introducing new concepts and formats to differentiate their stores and sustain footfall. New product ranges, revamped private label offers and extra services and facilities are all helping propel the convenience concept further.

Reasons to Purchase

*Lead innovations within you company by accessing lots of ideas from across Europe which can be applied to your own convenience operations.

*Develop strategies that respond to the latest consumer eating behaviours and preferences across areas such as organics produce and private label.

*Ensure that decisions on location, formats, brand and range response to the competitive threats facing the convenience retailing sector.

 
 
 
Table of Contents : 
Summary points 2
Smaller formats outperforming the rest 2
Rise of the multiples 2
Regional expansion of multiples’ convenience formats 2
Traditional convenience store and independents diminishing 2
Discounters venturing into convenience realm 2
Increased competition from retailers downsizing formats 2
Changing demographics and consumer behaviour creating new fields of convenience in Europe 2
More single person households and an aging population boosts demand for shopping locally 2
More urban living provides boost to City formats 2
Consumer purchasing habits are becoming more erratic 2
Consumer eating habits are becoming more varied 2
As one size does not fit all retailers need to adapt convenience concept to target local market 2
Main conclusions 3
Smaller formats outperforming the rest 3
Rise of the multiples 3
Regional expansion of multiples’ convenience formats 3
Traditional convenience store and independents are diminishing 3
Discounters are venturing into the convenience realm 3
Increased competition from retailers downsizing formats 4
Changing demographics and consumer behaviour creating new fields of convenience in Europe 4
More single person households and an aging population boosts demand for shopping locally 4
More urban living provides a boost to City formats 4
Consumer purchasing habits are becoming more erratic 4
Consumer eating habits are becoming more varied 5
As one size does not fit all, retailers need to adapt the convenience concept to target the local market 5
Table of Contents 6
Table of figures 7
CONSUMER DEMOGRAPHICS AS DRIVERS OF CONVENIENCE 8
Many socio-demographic trends create a business case for investment in convenience 8
Europe’s ageing population – time for retailers to respond 9
Retailers must be mindful of the new financial constraints of the aging population 10
Case study: German grocer Edeka has adapted its stores in response to the ageing population 10
More people are shopping for one 11
A growing urban population across the EU will influence retailers’ expansion plans 11
CHANGING SHOPPING HABITS AS DRIVERS OF CONVENIENCE 13
The top-up shop is growing in popularity 14
Extended store opening hours suit busy lifestyles 15
For top-up shoppers store proximity has a high influence on where they choose to shop 16
Online grocery shopping is also a form of convenience retailing 17
The vast majority of consumers don’t currently buy groceries online 17
Shop and delivery options are broadening the appeal of online grocery shopping 20
Pick and Drive models are emerging 20
The way things are going – Internet for main food shop, local store for top-up 21
COOKING AND EATING HABITS AS DRIVERS OF CONVENIENCE 22
Meals and snacks continue to become more fragmented 22
Consumers are increasingly prone to skipping meals 23
Food to go is a growing sector 25
Consumers are less willing to spend their free time on food preparation 27
There is a rise in the variety of foods consumers are willing to try 29
Healthy eating is a growing concern among consumers 30
There is demand for fresh food options in local stores 32
Demand for organic and locally produced goods varies 33
A proportion of convenience customers are value seekers 36
The propensity to buy private label is currently lower among convenience customers 37
CONVENIENCE RETAILING COMPETITIVE LANDSCAPE IN EUROPE 39
Convenience and local stores are outperforming hypermarkets 39
Case study: Casino riding on convenience stores’ resilience 39
Case study: Carrefour’s hypermarkets suffering while convenience is outperforming 41
Retailers are expanding their convenience store base 42
The multiples have been expanding their convenience store estate 43
Multi-format strategies are being developed to encompass convenience 45
European grocery retailers are also increasingly implementing brand convergence strategies 45
Case study: Carrefour extends multi format single brand strategy to convenience 46
Case study: Rewe’s brand convergence strategy – from many to one 47
Brand convergence has operational advantages 48
Independents have to respond to the expansion of the multiples 48
Acquisitions will provide a quick route to convenience growth for some 48
The focus on the convenience format is forecast to continue 49
The convenience concept is being revitalised in Central and Eastern Europe 50
Smaller formats are being used to exploit opportunities in smaller catchment areas 50
Foreign entrants are involved in format diversification 50
Some domestic players are extending their store network 50
Legislation issues are driving growth of the convenience format 51
Easing of the loi Raffarin in France provides boost to small store openings 51
Opening hour liberalisation in Germany has been taken advantage of by most grocers 52
In Italy, regional differences make legislation challenging for all retailers 52
Polish retailers target small store expansion at petrol station locations exempt from trading bans 53
THE FUTURE OF THE CONVENIENCE MODEL 54
New formats and concepts are emerging 54
Retailers are extending the food to go offer to include coffee and hot food to take away 55
Case study: Billa grabbing a share of Austrian food to go market 57
Food to go offers increasingly cover all mealtimes 58
Food service offers have resulted in seating areas in some stores 58
The inclusion of delicatessens is growing in popularity 59
New formats are stretching traditional perceptions of the convenience model 60
El Corte Inglés has opened a convenience department store 60
Retailers are mixing and matching new concept ideas 61
Chez Jean is the new generation convenience store in France 61
A range of innovative technologies are very relevant to convenience retailers 65
Digital display technology creates a platform for consistent pricing and promotional messages 65
New payment technologies can increase transaction times and reduce cash handling and labour costs 67
Self-service check-outs have been installed throughout Europe 67
Contactless payment technology features in some inner city stores 68
Mobile phone payment is being piloted by some convenience retailers 68
Biometric payment methods are relatively uncommon in convenience stores 69
Click/text and collect will become more popular 71
THREATS TO TRADITIONAL CONVENIENCE RETAILERS 72
Discounters pose a major threat to traditional convenience stores 72
Discounters are making inroads into city centre locales 72
Discounters are venturing into the convenience realm 72
Lidl Express case study: Revamping offer to meet demand for convenience and value 72
Dia case study: A discounter’s response to proximity shopping 74
Competition from the traditional grocers is also escalating 75
Smaller supermarkets pose an increasing threat to the traditional convenience model 75
New players are entering the convenience realm 76
STRATEGIC RESPONSE – PRODUCT RANGE 77
Launch value ranges and focus on own brand categories 77
Offer low priced own label alternative to price sensitive shoppers 77
Extend private label ranges to grow sales 80
Identify product ranges and categories that create differentiation 80
Implement a stock rotation strategy 81
Ensure products are aligned with key demographic and behavioural consumer trends 82
Offer smaller portion packages for single person households 82
Exploit the trend for entertaining at home 82
Respond to healthy and ethical eating demands 82
Provide locally produced goods where consumers demand it 83
Provide a variety of foods for different preferences 84
Increase promotional activity 85
STRATEGIC RESPONSE – CONVENIENCE STORE OPTIMISATION 86
Respond to changing demographics and consumer behaviour 86
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http://www.aarkstore.com/reports/The-Future-of-Convenience-Retailing-in-Europe-45506.html

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