MAPCO, Hess Look to Distinguish Themselves in Changing Environment

Published in CSP Daily News

Retailers offer insights into their "visions of the future" at NACS Leadership Forum

By  Melissa Vonder Haar, Tobacco Editor

Igal Zamir (left), Chris Baldwin

MIAMI -- With trends shifting away from convenience store staples like fuel and tobacco and increased competition from the drug and dollar stores, preparing for the future may seem a daunting task. "Humility is the key to staying relevant," Hess Corp's senior vice president Chris Baldwin said during Monday's general session at this year's NACS Leadership Forum, going on this week in Miami. It's theme: "Visions of the Future."

Baldwin joined Igal Zamir, president of MAPCO Express, in a panel to address challenges facing the industry and how their organizations are evolving to succeed in the future.

Consumer attitudes on c-stores are a big issue facing the industry. Zamir shared some troubling results from research conducted by the Brentwood, Tenn.-based retailer, which found that c-store shopping trips are down while nonconvenience shopping trips are up. Additionally, MAPCO found that 51% if consumers believe all c-stores are the same and don't differentiate.

A lessening dependence on fuel is another challenge. Both Zamir and Baldwin agreed that fuel has hit its peak. "Higher-mileage vehicles are the wave of the future," said Baldwin, noting that the New York City-based operator is looking to natural gas alternatives to address this shift.

This decrease in fuel need has paved the way for drug stores like Walgreens, CVS and Duane Reade to become direct competitors of the c-store channel. Zamir described drug stores as "our primary competitor and after our customer."

Such challenges do not mean the industry cannot survive and thrive in the future. For MAPCO, the key has been distinguishing its locations as neighborhood stores designed to meet the unique needs of local consumers. The strategy has allowed MAPCO to hold the No. 1 or No. 2 positions in its key markets.

Zamir said that MAPCO will continue such tactics, sharing a model of a future MAPCO Express with a fresh and modern design. Featuring a separate space for foodservice outside of the actual c-store, the goal was to further differentiate MAPCO from the typical c-store model, Zamir said.

Adapting foodservice programs to meet changing consumer demand is another way in which operators can grow their business in the future. With obesity rates growing, more and more customers are seeking out healthier options.

"We need to be part of the solution," said Baldwin. "If we don't take a stand, others will do it for us."

Becoming a destination for fast, fresh food has already begun to pay off for MAPCO, which has seen a 12% annual growth in its foodservice program.

"QSR is key growth to our channel," Zamir said. "We need to deliver a new expectation."