How C-stores Can Attract Thrift-Savvy Shoppers

In a time when every penny counts, convenience store (C-store) consumers are becoming more deliberate with their purchases. Inflation has reshaped shopping behaviors, driving more focus on stretching dollars and finding value. For C-store operators, adapting to this reality is not just good business—it’s essential for maintaining customer loyalty and thriving in a competitive marketplace. Here, we explore how inflation impacts consumers and retailers, which products have been most affected, and strategies C-stores can adopt to attract thrift-savvy shoppers.

How Inflation Has Impacted Consumer Behavior

While inflation is currently (as of 12/2024) at 2.6%, consumers are reeling from an inflation rate of 7% in 2021 that stayed strong at 6.5% in 2022, finally coming down to 3.4% in 2023. Those two years of high inflation have kept prices high: increasing the cost of living and reducing consumers’ purchasing power. Many shoppers now seek cost-saving measures, such as choosing lower-cost alternatives, buying in smaller quantities, and prioritizing essentials over discretionary items. These behaviors have allowed C-stores to become the go-to destination for thrift-savvy shoppers.

Consumers have also shifted preferences:

• Increased demand for promotions and discounts: Shoppers actively seek deals, coupons, and loyalty rewards.
• Prioritization of essentials: Snacks, beverages, and fuel remain strong sellers, but discretionary spending has dipped.
• Willingness to switch brands: Brand loyalty has decreased, with many shoppers opting for private-label or store-brand products.

Which Products Have Been Most Impacted by Inflation?

Inflation has not affected all product categories equally. Here’s a closer look at the items most impacted:

1. Snacks and Packaged Foods: Inflation has led to rising costs in raw materials, packaging, and transportation. Prices for popular items like chips, candy, and baked goods have surged, with many companies shrinking package sizes while maintaining or increasing prices.
2. Beverages: Carbonated drinks, bottled water, and coffee have faced significant price increases due to higher costs for production, transportation, and materials like aluminum for cans.
3. Fuel: Fuel prices have been highly volatile, affecting consumer budgets. Shoppers may prioritize fuel discounts or loyalty programs when choosing where to fill up.
4. Tobacco and Alcohol: Regulatory fees, production costs, and distribution challenges have driven up prices, making these products less accessible to price-sensitive shoppers.
5. Prepared Foods: In-store foodservice, such as sandwiches and hot meals, has been hit by rising ingredient and labor costs, impacting pricing strategies and profit margins.

How Inflation Has Impacted Retailers

Consumers aren’t the only ones impacted by high inflation. C-store operators are grappling with several inflationary challenges:

• Rising operational costs: Increased labor, energy, and supply chain costs are squeezing profit margins.
• Inventory management: Balancing inventory to prevent overstocking or running out of high-demand items has become more complex.
• Price sensitivity: Passing on increased costs to consumers can drive away price-sensitive shoppers.
• Shrinkflation backlash: Consumers are becoming more aware of shrinkflation (reduced product sizes) and may feel they’re not getting good value for their money.

Strategies to Attract Thrift-Savvy Shoppers

To thrive in an inflationary environment, C-stores must align their strategies with the needs of value-conscious consumers. Here are actionable tips to promote value and attract customers:

1. Offer Competitive Pricing and Discounts

• Leverage loyalty programs: Implement or enhance loyalty rewards programs to offer discounts, free items, or points redeemable for future purchases. Most C-stores within our H&S Energy Group family promote value with our Power Market Rewards program.
• Promote bundled deals: Pair complementary items like coffee and pastries at a discounted price to encourage larger purchases.
• Emphasize private-label brands: Private-label products typically have lower prices while offering comparable quality, appealing to shoppers seeking value. Our H&S Energy family of C-stores has the opportunity to feature our private-label Papa Sal’s products.

2. Highlight Fuel Rewards

With fuel prices fluctuating, consumers are eager to save at the pump. Partnering with fuel reward programs or offering discounts tied to in-store purchases can drive fuel sales and foot traffic.

3. Focus on Value-Priced Essentials

Stock smaller-sized items or budget-friendly alternatives to provide options that meet varying price points. Promote these products through signage, endcap displays, and targeted digital marketing.

4. Optimize In-Store Promotions

• Use data-driven insights: Analyze purchasing data to identify top-selling items and create promotions around them.
• Time-sensitive discounts: Offer limited-time deals to create urgency and encourage impulse purchases.
• Cross-promotions: Pair slow-moving items with high-demand products in promotional offers to boost sales across categories.

5. Enhance Prepared Food Options

Consumers looking to save money often favor convenience over eating out at full-service restaurants. To attract thrift-savvy shoppers, invest in value-priced prepared food options, such as grab-and-go meals or meal kits. In addition to grab-and-go hot and cold food items, many of our H&S Energy C-stores feature Papa Sal’s Delis.

6. Invest in Digital Marketing

There are more options than ever before to get the word out about your C-store’s value proposition. Use digital platforms to connect with thrift-savvy shoppers:

• Promote deals on social media: Share weekly specials and loyalty rewards on Instagram, Facebook, or Twitter.
• Offer mobile coupons: Provide digital coupons that can be easily redeemed in-store.
• Geofencing campaigns: Target customers near your store with promotions to capture foot traffic.

7. Improve Store Layout and Merchandising

Make it easy for customers to find value items:

• Dedicate prominent shelf space to budget-friendly products.
• Use clear signage to highlight sales, discounts, and private-label options.
• Position essentials like milk, bread, and snacks near the entrance to appeal to grab-and-go shoppers.

8. Build Community Connections

Inflation has encouraged shoppers to support local businesses and “shop local.” Position your store as a community hub by:

• Partnering with local suppliers to stock unique, local products.
• Supporting local events or charities to boost brand goodwill.

9. Train Staff to Engage Customers

Empowered staff can make a difference by:

• Recommending value items or deals to customers.
• Offering personalized service that enhances the shopping experience.
• Ensuring speedy checkout processes, minimizing frustration for busy shoppers.

Why Partnering with H&S Energy Makes Sense

Inflation has reshaped consumer behavior, driving shoppers to seek value and stretch every dollar. This presents an opportunity for C-store operators to build stronger relationships that attract thrift-savvy shoppers by focusing on competitive pricing, loyalty programs, prepared food options, and community connections.

Navigating inflationary pressures requires innovative strategies and trusted partnerships. H&S Energy specializes in helping C-store owners adapt to market challenges with a suite of services designed to boost profitability and attract value-conscious shoppers.

H&S Energy can support your business by implementing customer-focused loyalty programs, encouraging repeat visits, and designing fuel discount strategies to drive in-store purchases and enhance customer retention. Our expertise extends to optimizing store layouts, inventory, and merchandising to attract and retain value-conscious shoppers. Additionally, H&S Energy provides professional consultation, offering tailored advice to address the unique needs of your store and community, ensuring your business thrives in today’s competitive market.

By implementing strategic changes and partnering with experts like H&S Energy, convenience stores can weather the challenges of inflation and thrive as a trusted destination for value-conscious shoppers. Contact H&S Energy today to learn how we can help your business attract customers and increase profitability in an inflationary environment.