During the first lockdown, many quickly realised their businesses needed the capability to do things like accept payments and orders remotely, first over the phone and then, increasingly, via the internet. This was crucial in order to keep up with the requirements of shoppers, who turned to online shopping and home delivery in their droves. A report from market analyst Lumina Intelligence earlier this year found nearly one in five shoppers had changed their primary method of grocery shopping to online, while 8% of convenience stores were now offering delivery.
One of the leaders in the field is Snappy Shopper, a home delivery platform that has been tailored for the convenience sector. It now supports online ordering from more than 730 stores across the UK, ranging from unaffiliated retailers through to Spar, Nisa and Premier outlets, as well as regional co-ops.
Marketing director Philippe Rondepierre says: “It is important for convenience stores to embrace technology, because customers want it and all local competitors will be offering it. Home delivery is a game-changer for convenience, because it is the one initiative that will add thousands of pounds to a store’s weekly turnover and will enable retailers to tap into a customer base beyond the physical catchment area of their stores.”
According to Lumina Intelligence, in those stores that have adopted home delivery, the channel now accounts for 7% of their sales on average. Snappy Shopper says its top 10 retailers have been generating more than £17,000 a week in delivered turnover, while its leading retailer has achieved £1.25m of home delivery sales over the past year. Says Rondepierre: “Our most successful store has as many as 1,000 orders a week, but the average is around 80 orders a week.” Basket spend is also higher, with Snappy Shopper customers spending an average £27 online, compared with £7.60 when walking into a store.
Rondepierre adds: “Home delivery is ultra-convenient for consumers who will have got used to ordering online during lockdown. There is no need for them to get out in the pouring rain or carry heavy bags of shopping back to their home.” The technology is also easy for retailers to use, he says. “Orders are captured via website or an app available from the Google Play and App stores. The platform transfers those orders to a terminal located in the store and staff assemble the order before it is delivered to shoppers. The driver has their own app, which includes age verification, and shoppers get notified when the driver is on their way.”
The other big trend accelerated by the pandemic has been the move towards contactless payments. The Association of Convenience Stores (ACS) Local Shop Report 2020 revealed that while 100% of retailers accept cash as payment, 94% take cards and 88% accept contactless payment. Tom Fender, development director at data analyst TWC, says: “Following Covid-19, the vast majority of transactions are now contactless, with consumers saying they don’t want to use cash for fear of transmitting or catching the virus.”
A recent report from TWC found 60% of consumers said they had made more use of contactless payments, while 44% said contactless was now a ‘must-have’ for consumers in convenience stores. However, the ACS says retailers should not go fully contactless, as a significant proportion of the population still prefers to pay in cash. Says Fender: “It is really important that convenience retailers cater to this cohort of customers who are slower to adapt to contactless payment. They are a core group for our sector.”
While home delivery and contactless have been the most visible beneficiaries of changing shopping patterns during lockdown, other emerging technologies are likely to return to the fore as restrictions ease over the coming months. Darren Nickels, retail technology operations director at Henderson Technology, says the group’s EDGEPoS self-checkouts are now live in more than 170 stores across Northern Ireland, Scotland, England and Wales.
“Retail technology has evolved over the last 12 months, and thankfully we have been prepared for any change in the forecourt and convenience sector,” he says. Henderson’s self-checkouts are designed to be cost-effect with no additional floor space or man-hour requirements and can be added to existing checkout lanes.
Spar Loughbrickland, located between Banbridge and Newry in County Down, is a purpose-built forecourt that opened in June 2017 and is one of three sites owned by brothers Aaron and Dale Beckett. “Reacting to the trends of our shoppers, we saw the advantages immediately of adding self-checkout to one of our tills,” says Dale Beckett.
“For our rush of school children who mainly pay by Apple Watch or smartphone, self-checkout has eliminated the queues at this time. Our customers still have the option of being served by a cashier, so we are able to provide both experiences to our customers, and EDGEPoS self-checkout enhances the unique and modern feel of our busy store.”
Another product Henderson Technology has developed and deployed is electronic shelf-edge labels (ESELs). Spar Loughbrickland adopted the technology in March 2020, with some 3,500 labels on products in-store. Dale Beckett says: “One of the biggest attractions to the ESELs is the fact we know everything on the shop floor is priced correctly. This gives us peace of mind and ultimately ensures customer complaints about incorrect pricing are eradicated. We also expect to see an increase in margin, and promotion change-overs are now effortless.”
So where does retail technology go from here? Fender at TWC says the possibilities are endless and are likely to include everything from click-and-collect to payment apps, loyalty schemes to augmented reality – where a shopper could hover their phone over a product and a video will pop up providing further information. “It will also be about better personalisation – for example, being able to adapt your order online and having more direct contact with customers so relationships can be built on,” says Fender.
But the big future trend remains how convenience retail adapts and shapes itself around delivery, he believes. “Consumers increasingly want to order impulse lines from their phone and have them delivered. The big question is how convenience retailers develop a solution to meet this emerging need in a way that is profitable and does not compromise on quality or customer service. One thing is clear – convenience operators need to be working on this puzzle.
“This is not just a technology problem, it is also a marketing issue – creating a differentiated proposition that means your store stands out from the crowd is going to be essential.” With competitors such as Amazon busy ramping up their grocery offers, he adds, there is a risk consumers will not care where they buy products from, as long as delivery is instant.