C-Stores Race to Meet Instant Needs With On-Demand Delivery

For today’s consumer, convenience is often not about geographic proximity but about digital accessibility.

As such, leading convenience retailers are in competition not only to get their stores nearest to consumers’ homes but also to provide the most convenient and affordable delivery experience.

Noting this demand, Couche-Tard’s Circle K brand has been getting into quick commerce in partnership with ultrafast grocer Food Rocket. The company is piloting a program whereby the latter delivers the c-store’s products from two locations in Charlotte, North Carolina, as the National Association of Convenience Stores (NACS) reported Wednesday (Nov. 30).

“As consumer needs and expectations continue to evolve, we’re exploring ways to bring the Circle K brand experience to them where they are and make their lives easier,” Kevin Lewis, chief marketing officer at Couche-Tard, told the NACS. “We’re looking forward to seeing how this pilot in Charlotte resonates with our customers.”

Quick-commerce delivery services having been having a difficult go of it in recent months, with some, such as Jokr (per TechCrunch’s report), backing out of many of the markets in which they operate, and others, apparently including DoorDash-owned Wolt (as implied in CEO Tony Xu’s statement Wednesday), laying off staff to cut costs. These moves come as global inflation has many consumers cutting back on unnecessary spending.

Circle K’s move to trial ultrafast delivery in this challenging macroeconomic environment follows Couche-Tard’s investment in Food Rocket, announced earlier this year.

For all the belt-tightening, consumers do still look for ways to get their last-minute needs met on demand. Research from PYMNTS’ July study “ConnectedEconomy Monthly Report: The Rise Of The Smart Home,” which draws from surveys of nearly 2,700 U.S. consumers, finds that, in May, about 1 in 3 consumers made a purchase from a same-day delivery website such as Shipt, and the majority of them did so weekly or more.

Get the study: ConnectedEconomy Monthly Report: The Rise Of The Smart Home

Meanwhile, convenience retail giant 7-Eleven has been building out its own on-demand delivery infrastructure with its 7NOW delivery app and its 7NOW Gold Pass free delivery subscription. With the presence of the offering across both 7-Eleven stores and subsidiary Speedway locations, it spans around 95% of 7-Eleven’s footprint, as Ryuichi Isaka, president and representative director of the company, told analysts in a presentation last month.

“We will seek to leverage as a strength this service, through which we deliver in 30 minutes or less an attractive merchandise assortment through quick commerce,” Isaka said. “As such, within this scope during the current fiscal year, we aim to expand coverage to enable delivery across approximately 6,000 stores.”

He added that the delivery service’s sales have grown “11-fold” relative to the first quarter of 2020.

Meanwhile, Casey’s General Stores, a U.S. convenience retailer with more than 2,400 locations, noted in a call accompanying its September earnings report that its digital business is strong, helped by an increasing selection of delivery items.

“Our mobile app now represents 65% of all digital revenue which is primarily driven by whole [pizza] pies. We’ve added more grocery and general merchandise items to the app as well,” CEO Darren Rebelez said. “We have also made great strides in delivery for beer and hard seltzers, which are a great complement to our pizza orders.”