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TNS Retail Forward
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Rising Gasoline Prices Drive Shoppers to Alternative Retailers—C-Stores Must Re-evaluate and Reposition TNS Retail Forward Reports

COLUMBUS, July 2, 2008—Alternative gasoline retailers, including supercenters, supermarkets, and warehouse clubs, are chipping away at the convenience store industry’s gasoline shopper base, reports TNS Retail Forward.  Recent TNS Retail Forward ShopperScape™ survey results indicate that one-third of shoppers are buying most of their gasoline at alternative outlets, up from 22% just three years ago.

“Fewer shoppers filling their tanks at convenience stores mean fewer shoppers filling their stomachs with higher-margin goods inside the store,” comments Jennifer Halterman, Senior Consultant with TNS Retail Forward.  “Sky rocketing gasoline prices also leave little change in shoppers’ pockets for in-store purchases,” she adds.

Alternative gasoline retailers now capture an estimated 13% of U.S. gasoline sales.  TNS Retail Forward projects this figure will grow to 16–17% by 2012.  “Continued high gasoline prices are making alternative players’ cents-off promotions very attractive.  As a result, we expect more shoppers to take advantage of the increasing number of fuel-reward programs,” Halterman notes.  “Aggressive fuel-reward programs combined with the convenience of one-stop shopping makes it no surprise that more shoppers are filling up at these alternative outlets,” she adds. 

While gasoline helps generate traffic and boost inside sales, alternative gasoline retailers must continue to explore ways to offset hefty fuel discounts and a low-margin business.  “Campaigns that tie fuel rewards to high-margin purchases such as private brands, non-grocery general merchandise items or in-store services will be critical going forward,” Halterman comments. 

Likewise, convenience stores must reduce reliance on gasoline and focus efforts inside their stores.  “Convenience will remain key,” notes Halterman.  “However, adding destination appeal with unique product offerings, innovative marketing and new service offers will help drive traffic, retain shoppers and increase profitability,” she adds. 

Convenience stores also need to pay attention to the growing number of small-store food concepts rising on the scene. “C-stores must prepare for a future retail landscape that will be filled with an increasing number of small-store concepts that home in on convenience,” Halterman adds. 

“C-stores must deliver a differentiated offer that not only delivers convenience but adds destination appeal,” she adds.  “Ultimately, convenience stores that reduce their reliance on gasoline by focusing efforts inside the store will be best positioned for the future,” Halterman concludes.  

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About TNS Retail Forward
TNS Retail Forward (www.retailforward.com ») is a global management consulting and market research firm specializing in retail intelligence and strategies. The company's syndicated research and executive development program, known as the Retail Forward Intelligence System™, provides members with an authoritative perspective on the retail and consumer products industries. 

About ShopperScape™
TNS Retail Forward’s ShopperScape™ survey is conducted monthly with a nationally representative sample of 4,000 U.S. primary household shoppers.  Survey results are available to members of the Retail Forward Intelligence System™ and ShopperScape™ as well as through individual reports available for purchase. For more information on ShopperScape™ or the Retail Forward Intelligence System™, contact kclarke@retailforward.com » or visit www.retailforward.com ».

About TNS

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