A new animal: Why foodvenience represents the future, by Joe Bona

If a biologist in the Amazon rainforest finds a new frog species, the next step is to give it a name. And since a new animal clearly has evolved in the convenience retail ecosystem, we might as well do the same. The animal in question is neither a full-blown QSR/fast-casual chain nor a traditional convenience store. Rather, it skillfully blends elements of these established concepts in ways that are both advantageous and new.

What to call this new creature? My vote is for the term foodvenience.

In the natural world, new species evolve in part because of changing environmental conditions. In the same way, foodvenience concepts are an adaptive response to significant shifts in the retail jungle—a kill-or-be-killed world in which finicky consumers increasingly expect higher quality and healthier foods (with customisable choices to boot) pretty much anywhere they go.

Today’s consumers are eating out more frequently and tilting toward premium offerings. They also crave something that is even more challenging for retail operators to provide—authenticity. This is not just a Millennial thing. These days, Gen Xers and baby boomers are just as likely as Millennials to shop at farmers markets, eat at “farm-to-table” restaurants or carefully scrutinise ingredient labels to avoid GMOs, added sugars or food allergens.

In nature, adaptations allow new species to out-compete older “models.” But in the retail world, do traditional c-stores selling mostly beer, cigarettes and lotto tickets truly represent where the industry is headed, or is the future better represented by the evolutionary efforts of Irish chains such as Topaz and Applegreen, or U.S. concepts like Sheetz and Wawa?

To be sure, thousands of traditional, no-frills c-stores will continue to exist. However, they will not be able to crawl onto dry land and exploit the new niche increasingly occupied by foodvenience concepts. While these next-generation stores do sell beer, cigarettes and lotto, they happen to be so focused on food and the customer experience that they can actually steal market share from both fast casual and QSR formats alike.

In years to come, the best foodvenience chains will give the likes of Pret A Manger, Itsu, Chipotle Mexican Grill, Five Guys Burgers and Fries, Shake Shack, Planet Organic and Leon a run for their collective money. More and more consumers will buy into the notion that they can get customised, high-quality tossed salads, pizzas or fresh-made sandwiches (not to mention some petrol) at stores that happen to be an easy stop on their way to work.

As foodvenience becomes more commonplace, players in this space will need to up the ante. The fast-casual arena offers a picture of what this will look like. Twenty years ago, a concept like Sweetgreen would have been viable in just a few “granola” college towns around the United States. Today, Sweetgreen has 51 locations across the country, with nine more on the way. Walk into a Sweetgreen and you’ll find a dizzying array of greens, grains, bases, proteins and dressings— all of it marked to indicate gluten-free or vegan, of course. Some customers buy readymade dishes such as “Rad Thai” or “Guacamole Greens,” while others build their own creations. Everything about Sweetgreen suggests a cut above. In marketing materials, Sweetgreen describes its cornerstones as “scratch cooking, transparency, sustainability, local sourcing and food safety.” It highlights store finishes that include “reclaimed hickory, barn board pine and bowling alley tables.” Not so long ago, all of this would have been unthinkable for a restaurant at this price point. But retail evolves.

Moreover, the appeal here is broad-based. When I was at a Sweetgreen location in New York City recently, I couldn’t help but chuckle at the hardhat-wearing construction workers standing in line alongside bearded Millennial hipsters and affluent moms in yoga pants. By offering healthier options, convenience-oriented food retailers are not just widening their appeal among women and younger people— all around the world, health-consciousness, choice and customisation are on the rise.

In the fast-casual space, some operators are seeking an edge by taking these trends even further. Oath Craft Pizza, a new U.S. fast-casual chain, strives to be much more than “the Chipotle of pizza,” as has been the goal for so many others in this particular category. With a brand rooted in an “oath” of quality and sustainability, Oath Craft Pizza offers high-quality ingredients, easy customisation and a 90-second cooking time. Thanks to the seriousness of its commitment, Oath Craft Pizza succeeds in conveying a greater sense of authenticity. And the pizza happens to be incredibly delicious.

Who would have thought that the likes of Oath Craft Pizza and Sweetgreen could ever represent competition for c-stores? In fact, they do. To remain competitive, the new foodvenience concepts must continually get better. In Boston, we recently helped Global Partners at its new Alltown Market modify the menu and up the ante on its ingredients. The goal was to offer more quality and customisation, precisely because of today’s competitive dynamics in convenience retailing.

Alltown also added touchscreen ordering, which highlights a potential competitive strategy for foodvenience concepts. The right technology, after all, can allow you to save on payroll costs even as you boost convenience. At the California concept Eatsa, people walk in and see no employees whatsoever—because the employees are literally behind the walls. The entire process, in fact, is automated, sort of like a 1950s-era automat. The four-store chain offers customisable bowls with names like “Yogurt Quinoa Parfait” or “Mediterranean Scramble,” along with fresh gourmet coffee and tea. You order and pay using a touchpad, then pick up your food at glass windows in the walls of the store. It is an easy and novel experience. In the years to come, count on evolving foodvenience retailers to tap tech solutions that boast similar advantages.

So what’s the formal definition of foodvenience? I’d say it’s any retail business that strives to give the public a highly convenient location; fast, efficient, takeout-ready foods at affordable prices; and a wide array of consumable products and services. Within this broad template, there’s plenty of room for creativity and growth. I can’t wait to see how foodvenience continues to evolve.

Joseph Bona is President of Franklin, Mass.-based MoseleyBona Retail, which specialises in elevating the convenience retail experience; info@moseleybonaretail.com

Source: Insight Global Convenience Store Focus