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CONVENIENCE ESSENTIALS TFROM PAGE 47 he role of the convenience Stock of essential products is key IBISWorld Senior Industry Analyst Matthew Barry also underscores to Convenience World the importance of supplying essential products, which could boost in-store visits over the outbreak period. In addition, as it’s anticipated there will be less foot traffic than usual into the foreseeable future, retailers that focus on online marketing and platforms to leverage their sales and deals are projected to have a boost in sales over this period, he says. On the ground, Nestlé Head of Marketing Confectionery Joyce Tan cites increased demand for grocery products and the broader Nestlé portfolio in convenience as shoppers take advantage of these products being available in their local convenience outlets, to minimise trips and exposure to large crowds. Convenient essentials consumed for the most part IRI food and grocery consultant Brooke Olliver-Burnside points out to Convenience World that despite the best intentions, supply chain blockages have affected the entire country during lockdown, including for the supply of convenient essentials to convenience stores. Within shortages, the stock categories most of interest to convenience outlets are grocery and household products. This is backed by IRI Lead Consultant Jan-Willem Verstraten, who points to a significant decline in non-food essentials in convenience stores, with Ms Olliver- Burnside highlighting that this trend had been in the making for quite some time in the pre-coronavirus period. “The trend to use convenience stores as a place to pick up convenient essentials such as meals on the go, snacks, salads or something health related such as nuts, protein bars and protein bowls, and of course, coffee, has been gathering momentum,” Ms Olliver-Burnside said. “This is in contrast to the past where the grocery section was pretty flat with a few pasta or cracker and cheese products. That hasn’t been the case for a while, with the grocery section experiencing double-digit growth, especially during COVID-19. “That’s where the movement is, as well as in the household section for medicinal and cream products – especially during lockdown.” Mr Verstraten says this focus on grocery and household products has lessened demand for non-food or what is termed general merchandise in convenience stores. “Non-food products have been draining the convenience segment,” he said. “We really haven’t seen a lot of growth there. “Things like car accessories and magazines haven’t been doing well for some time, not to mention communication and travel ticket items, as people access these online now.” Based on such trends, Mr Verstraten feels that convenience will continue in the direction of being a one-stop food shop and quick fresh-food alternative to a supermarket or cafe. Ms Olliver-Burnside says convenience stores are enticing not just in terms of food on the go, but also for essentials such as bread and milk as people reduce their visits to supermarkets. “This leads me to believe there’ll be a return to the traditional values of convenience stores, as opposed to them being a unique destination shop,” she said. Mr Verstraten says he doesn’t foresee coronavirus influencing store formats unless it comes to ranging different stock, but that the overall trend will be food getting more retail space. “I suspect that ‘Australian made’ on packaging didn’t do too much to trade a product up in the past, but at the close of the pandemic I think it will have more clout as there’s a perception of health around it,” he said. “It could even boost profit as the ingredients in the product could be cheaper to make and yet have the same effect on the consumer as the idea of organic.” As to marketing tools, Mr Verstraten says it’s clear from conversations with clients that they’re putting “all their eggs into the digital marketing basket because they’re unsure of everything at the moment”. “I feel this approach makes a lot of sense,” he added. This is echoed by Nielsen Australia’s Fresh Industry Lead, Melanie Norris, who comments that the expansion of e-commerce and home delivery services will be key areas of transformation in the coming months, as well as specialisation of small stores to match surrounding demographics. store is one that seems to have shifted the most during the pandemic, with Aussies now seeing it as one of “essentialness”, Wunderman Thompson Managing Partner and Director of Shopper Georgia Bruton tells Convenience World. This appears to be driven by people aiming to avoid the high foot traffic at major supermarkets, and not wanting to travel far from home, while many convenience stores have adapted to the needs of consumers, she says. She highlights that the pandemic has seen retailers stepping up in a way that creates pride in the industry, the brands and the “essentialness” of what they do for communities. “This is seen in opening an hour early so senior citizens and people who are high risk can shop without crowds, offering new products such as fresh produce and hand sanitiser at the smallest convenience store or pop- up cafes, redesigning store layouts to allow for social distancing, or simply offering free coffee or food to people who are working in the medical field,” she said. Ms Bruton says the convenience stores that have done well include those that have pivoted their businesses to adapt their product offering to be more focused on specific categories, such as nutritious and fresh, ready-to-heat at-home meals, personal hygiene, and cleaning; those adapting their store designs to allow for space between and within aisles for social distancing, and positioning essential products at the front of the store where many impulse category items would usually be placed; and those offering delivery or click and collect services that not only allow consumers to socially distance but also guarantee that products will be available. The role of corporations and brands, she says, is to step up and show consumers how they can play a role in their lives and society. She points to examples such as 7-Eleven improving lives and society through its new delivery service, many convenience stores now offering more fresh produce and cleaning products, and Nestlé helping to deliver meals to seniors. 48 CONVENIENCE WORLD JUL/AUG, 2020