Table of Contents
Executive Summary
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- The market
- Multi-track growth
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- Figure 1: Convenience store sector sales and forecast (incl. VAT), 2010-20
- Multiples account for over half the market
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- Figure 2: Estimated leading retailers’ share of the total market, by type of operation, (excluding VAT) 2011-15
- Deflation: Holding back value
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- Figure 3: Annual percentage change in the price of food and non-alcoholic beverages and alcoholic beverages and tobacco, 2010-February 2016
- Growth in other channels benefiting the convenience market
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- Figure 4: Market size for both online grocery retailing and grocery discounters, 2011-16
- Leading retailers
- Market shares: Tesco continues to gain
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- Figure 5: Leading convenience retailers’ estimated market shares, 2014 and 2015
- The consumer
- Convenience stores remain primarily a top-up destination
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- Figure 6: Where people shop, by shopping behaviour, February 2016
- Younger consumers driving the market
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- Figure 7: Usage of convenience stores, by age and shopping behaviour, February 2016
- Where they shop
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- Figure 8: C-stores used, February 2016
- What they buy
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- Figure 9: Products bought in c-stores, February 2016
- Driving footfall with services
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- Figure 10: Services used in convenience stores, February 2016
- Satisfaction with convenience stores
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- Figure 11: Overall net satisfaction with last convenience store used, by criteria, February 2016
- C-stores seen as a good option for food-to-go but variety is needed
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- Figure 12: Attitudes towards food-to-go in convenience stores, February 2016
- What we think
Issues and Insights
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- Getting food-to-go right
- The facts
- The implications
- 7-Eleven and Postmates: A logical online grocery solution for c-store operators?
- The facts
- The implications
- Consolidation in the market: a necessary evil?
- The facts
- The implications
The Market – What You Need to Know
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- Market growth slows but continues ahead of the wider grocery sector
- Food price deflation affecting the market
- Growth in other channels benefiting the market
- A move back to urban areas, and into rented accommodation, a driver
Market Size and Forecast
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- Figure 13: Convenience store sector sales and forecast (incl. VAT), 2010-20
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- Figure 14: Convenience store sector sales and forecast (incl. VAT), at current and constant prices, 2010-20
- How the market is made up
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- Figure 15: Estimated leading retailers’ share of the total market, by type of operation, (excluding VAT) 2011-15
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- Figure 16: Store numbers of the leading convenience operators, by operation, 2011-15
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Market Drivers
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- Figure 17: Annual percentage change in the price of food and non-alcoholic beverages and alcoholic beverages and tobacco, 2010-February 2016
- Real wages rising
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- Figure 18: Real wages growth: Wages growth vs inflation, 2011-16
- Growth in other channels benefiting the c-store market…
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- Figure 19: Market size for both online grocery retailing and grocery discounters, 2011-16
- Rise in renting fuelling top-up shopping…
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- Figure 20: UK household tenure status, 2010-14
- …particularly amongst younger consumers
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- Figure 21: UK household tenure status of 16-34-year-olds, 2010-14
- Growth in larger household sizes
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- Figure 22: Household size as a percentage of total households, 2010 and 2015
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The Consumer – What You Need to Know
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- Convenience stores remain primarily a top-up destination
- Usage being driven by the young and affluent
- Tesco Express comes out on top
- Fresh an important category
- New services can replace lost footfall
- Satisfaction with convenience stores
- Many see convenience stores as a viable alternative to foodservice outlets
How They Shop
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- Figure 23: Where people shop, by shopping behaviour, February 2016
- Where people do their top-up shopping
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- Figure 24: Where main shoppers do top-up shopping, by grocery format used for a main shop, February 2016
- How grocery shopping habits are evolving
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- Figure 25: Where people do their main shopping, 2014-16
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- Figure 26: Where people do their top-up shopping, 2014-16
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Demographics and Frequency of Convenience Store Use
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- Younger consumers driving the market
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- Figure 27: Usage of convenience stores, by age and shopping behaviour, February 2016
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- Figure 28: Convenience store usage, by socio-economic group and shopping behaviour, February 2016
- Urban areas: A key battlefield for c-store operators
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- Figure 29: Usage of convenience stores, by type of area lived in and shopping behaviour, February 2016
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- Figure 30: Usage of convenience stores, by region lived in, February 2016
- Frequency of convenience store usage
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- Figure 31: Frequency of c-store visits by c-store shoppers, February 2016
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- Figure 32: Profile of c-store shoppers, by frequency of use, February 2016
Where Do They Shop?
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- Figure 33: C-stores used, February 2016
- Symbols gaining shoppers
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- Figure 34: Convenience store retailers used, 2014-16
- Co-op sitting outside the growth areas
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- Figure 35: Profile of convenience stores, by any shoppers who have used them in the last three months, February 2016
- The focus on urban areas paying off for the multiples
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- Figure 36: Convenience store retailers used, by area lived in, February 2016
- Store repertoire
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- Figure 37: Store repertoire of convenience store users, February 2016
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Products Bought and Services Used in Convenience Stores
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- Figure 38: Products bought in convenience stores, February 2016
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- Figure 39: Profile of convenience store shoppers, by what products they buy, February 2016
- Multiples over-indexing on growth categories
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- Figure 40: Products purchased in convenience stores, by convenience store retailer regularly used, February 2016
- Repertoire of products purchased
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- Figure 41: Repertoire of products purchased in convenience stores, by age, February 2016
- Services – A traffic generator
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- Figure 42: Convenience store services used, February 2016
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- Figure 43: Profile of c-store shoppers, by services used, December 2015
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Satisfaction with Convenience Stores
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- Figure 44: Overall net satisfaction with last convenience store used, by criteria, February 2016
- Key driver analysis
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- Figure 45: Key drivers of overall satisfaction with convenience stores visited most often, February 2016
- Figure 46: Overall satisfaction with convenience stores visited most often – Key driver output, February 2016
- Overall satisfaction with retailers
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- Figure 47: Overall satisfaction with last convenience store used, by type of convenience store used most often, February 2016
- How do the big three fare?
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- Figure 48: Overall satisfaction with last convenience store used, by retailer used most often, February 2016
- Pricing, range, quality and availability
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- Figure 49: Satisfaction with factors relating to range, by retailer used most often, February 2016
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- Figure 50: Satisfaction with factors relating to availability, quality of fresh products and pricing, by retailer used most often, February 2016
- The store experience
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- Figure 51: Satisfaction with factors relating to availability, quality of fresh products and pricing, by retailer used most often, February 2016
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Attitudes towards Convenience Stores
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- Figure 52: Attitudes towards food-to-go in convenience stores, February 2015
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- Figure 53: Agreement with statements regarding food-to-go in convenience stores, February 2016
- Convenience stores and loyalty schemes
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- Figure 54: Agreement with the statement ‘Loyalty schemes would encourage me to shop at particular convenience stores’, February 2016
- Opening hours and free time
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- Figure 55: Agreement with statements regarding free time on the impact of convenience store use, February 2016
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- Figure 56: Agreement with statements regarding free time on the impact of convenience store use, by age and socio-economic group, February 2016
- Sunday trading hours
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- Figure 57: Attitudes towards a potential change in Sunday trading regulations, February 2016
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Key Players – What You Need to Know
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- Multiples continue to gain share
- Competitive strategies
- Multiples give over more space to fresh
- Spar and the Co-op struggle in the brand perception stakes
Leading Retailers – Key Metrics and Market Shares
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- Figure 58: Leading convenience retailers’ estimated market shares, 2014 and 2015
- Sales
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- Figure 59: Leading convenience retailers’ net revenues, 2011-15
- Outlets
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- Figure 60: Leading convenience retailers’ outlet numbers, 2011-15
- Sales per outlet
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- Figure 61: Leading convenience retailers’ annual sales per outlet, 2011-15
- Detailed market shares
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- Figure 62: Leading convenience retailers’ estimated shares of sector sales, 2011-15
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Competitive Strategies
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- Multiples
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- Figure 63: Major grocery multiples, key sector metrics, 2011-15
- Tesco Express: Consolidating a commanding lead
- M&S Simply Food: Appealing to the affluent Millennials and branching out in food-to-go
- The Co-op: Expansion into urban areas crucial
- Sainsbury’s Local: Rapid expansion fuelling growth
- Little Waitrose: A smaller presence but growing quickly
- M Local: A cautionary tale
- Symbol and buying groups
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- Figure 64: Leading symbol, buying and retail groups, key sector metrics, 2011-15
- Booker: Now the leading symbol operator
- Spar: Continues to perform well but the brand may need a refresh
- Costcutter Supermarkets Group: A diverse range of operations
- Nisa: Looking to modernise its approach
- Lifestyle Express: Member numbers falling
- Best-One: Continuing to attract members
- Leading forecourt operators
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- Figure 65: Leading forecourt operators, key sector metrics, 2011-15
Space Allocation Summary
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- Space allocation overview
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- Figure 66: Convenience stores: Summary space allocation, by percentage share of in-store shelf space, April 2016
- In-store food mix largely dictated by space and refrigeration capacity
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- Figure 67: Convenience stores: Fresh food and other food mix, by percentage share of in-store shelf space, April 2016
- In-store bakery an integral part of the c-store destination appeal
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- Figure 68: M&S Simply Food, Notting Hill Gate, London: In-store bakery
- Detailed space allocation
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- Figure 69: Little Waitrose, West Hampstead, in-store seating area
- Figure 70: Convenience stores: Detailed space allocation, April 2016
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- Figure 71: Convenience stores: Detailed space allocation, April 2016
Retail Product Mix
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- Figure 72: Leading convenience stores: key operating statistics, 2014/15
- Figure 73: Leading convenience stores: estimated sales, by broad product category, 2014/15
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- Figure 74: Leading convenience retailers’ sales mix, 2014/15
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Innovation and Launch Activity
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- Drive-thru convenience store
- On-demand delivery
- Targeting ‘Transumers’
- New value-driven c-store formats
- New supermarket convenience store formats
- ‘Black Friday’ comes to the c-store sector
- Smartphone app loaded with special offers and benefits
- Medical centres
- Unmanned 24 hours a day convenience store
- Meeting on-the-go consumers’ service needs
Brand Research
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- What you need to know
- Brand map
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- Figure 75: Attitudes towards and usage of selected brands, August 2015 and January 2016
- Key brand metrics
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- Figure 76: Key metrics for selected convenience store brands, August 2015 and January 2016
- Brand attitudes: The Co-op hits the ethical mark
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- Figure 77: Attitudes, by convenience store brand, August 2015 and January 2016
- Brand personality: M&S Simply Food stands exclusively on its own
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- Figure 78: Brand personality – Macro image, August 2015 and January 2016
- Sainsbury’s and Tesco seen as being reliable but Spar disappoints
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- Figure 79: Brand personality – Micro image, August 2015 and January 2016
- Brand analysis
- Sainsbury’s Local: scoring well with the key demographics
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- Figure 80: User profile of Sainsbury’s Local, January 2016
- Tesco Express: High trust despite some negatives
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- Figure 81: User profile of Tesco Express, January 2016
- M&S Simply Food: High prices and high earners
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- Figure 82: User profile of M&S Simply Food, August 2015
- Spar: An outdated image
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- Figure 83: User profile of Spar, January 2016
- The Co-operative: Getting the message across in the right way
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- Figure 84: User profile of The Co-operative, August 2015
Advertising and Marketing Activity
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- Total advertising spend down 3.7% in 2015
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- Figure 85: Recorded above-the-line, online display and direct mail total advertising expenditure by UK supermarket and convenience store operators, 2011-15
- Biggest c-store brand advertiser spenders in 2015
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- Figure 86: Leading UK supermarket and convenience store operators: Recorded above-the-line, online display and direct mail total advertising expenditure, 2011-15
- Press and TV dominate
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- Figure 87: Leading UK supermarket and convenience store operators: Recorded above-the-line, online display and direct mail total advertising expenditure, by media type, 2015
- Nielsen Media Research coverage
Appendix – Data Sources, Abbreviations and Supporting Information
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- Data sources:
- Financial definitions:
- Abbreviations
- Trade definitions
- VAT
- Consumer research methodology
- Key driver analysis: Methodology
- Interpretation of results
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- Figure 88: Overall satisfaction with convenience stores visited most often – Key driver output, February 2016
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- Figure 89: Satisfaction with convenience stores visited most often, February 2016
- Market size and forecast: Forecast methodology
- Space allocation methodology
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