Shopper behaviour in Convenience Petroleum and

Shopper behaviour in Convenience & Petroleum … and how to leverage it for improved merchandise purchase incidence September 2007

The merchandise incidence opportunity Source AACS 2007 You can increase incidence by increasing relevance – play to occasions and dayparts

Contents 1. Shopper daypart occasions 2. Execution by C&P channel segment: • Segment shopper behaviour variances • What to do about it – visibility and merchandising, space & layout, persuasion and service

1. C&P shopper occasions by daypart

Daypart occasions: Monday-Friday 6 am 9 am Drive time Breakfast 12 noon 3 pm 6 pm Lunch AM break Healthy snack 9 pm 12 mid Dinner on the run PM Treat Incl post-school Snacks to stay in/DVD Late night munchies Drive time Dinner prep Emergency runs

6 am Daypart occasions: Weekends 9 am Newspapers Bread & milk 12 noon 3 pm 6 pm Emergency party pickups – Ice, softdrinks Chores – petrol, car wash, Tyres, auto care 9 pm Snacks to stay in/DVD Dinner prep Cool down (summer) – Ice cream, FCB 12 mid Late night munchies Emergency runs

Executing dayparts: some ‘whats’ Meals Meal Solutions Range ready to eat meals Range fresh fruit & veg Bundles eg mains + desserts + drinks + Snacks Bundle confec/snacks & bev + + +

Executing dayparts: some ‘hows’ Queue Merchandising n. By daypart – portable wheel-inwheel-outs n. Same 1 -2 units, restocked with different items n. Interchangeable header cards Offlocation Displays n. Gondola ends and in major traffic pathways n. Eg between back of store fridges and counter n. Occasion or daypart based, ideally Meals Specific area of store, clearly signed Opportunity for cross category occasion promotion in forecourts? !

2. Channel segment execution: key missions

The major missions – they change by daypart n Treat n Meal Express top up Emergency n Destination Craving n Services n n n The overall priority of these also varies a bit by channel segment, we’ll address this later

Shopper behaviour changes by channel segment Convenience Only Dual C&P Petrol Only More likely to be: • Inner city • Suburban strips • Apartment developments • Tier 1 and Tier 2 • Major arterial roads and highways • Tier 3 • Suburban • Some arterial roads

Convenience Only Shoppers Who? Dominated by male adults living at home or CBD professionals Both low and high incomes But more females in 7 ELEVEN than other banners Why? Missions Meal, Treat, Express Top Up, Craving, Emergency items When? Primarily evenings after 5 pm, afternoon How? Shop alone, may be buying for self or other Around 7 minutes in store Planned purchase but easily influenced What? Many buy drink only (opportunity!) Categories Around a quarter buy fresh meals Up to a quarter buy snacks & confec = dominated by food & beverage categories … and Telco also sells well

Dual C&P Shoppers Who? Dominated by male older adult workers (including tradies and truckies) Middle income Why? Missions Service, Treat, Craving (thirst, hunger), Meal (lunchtimes), Destination (milk, bread, newspapers) When? Primarily lunchtimes, drive times (6 -9 am, 4 -7 pm) How? Shop alone, buying for self Around 6 minutes in store Planned purchase but impulse purchases also Two thirds straight to the queue after fuel refill What? Only around 3 in 10 shop ‘rest of store’ (opportunity!) Categories Drinks, snacks / treats and auto (oil etc. )

Petrol Only Shoppers Who? Male younger adult Middle income Why? Missions Service, Craving. Meal if travelled long distance (regional petrol station) When? Before 9 am, 2 -5 pm How? Shop alone, buying for self Less than 6 minutes in store Vast majority straight to the queue after fuel refill Impulsive purchases in merchandised queue What? Categories Mainly drinks and auto, some confec / snacks

Shopping occasions change priority by channel segment Convenience Only Dual P&C Petrol Only Half of needs are food! Service here includes internet Local alternative to supermarket More impulse purchases ‘On the way’ to somewhere Tap into the service need. The basics. 1. Treat 1. Services 2. Meal 2. Treat 2. Craving 3. Express top up 3. Destination 4. Emergency 4. Meal 4. Treat 5. Destination 5. Craving 5. Emergency 6. Services 6. Emergency 6. Meal 7. Craving 7. Express top up

Convenience Only Variation/Emphasis n n Walk in, not drive Meals, Express top up, Emergency Higher incomes Some frequent locals Implication n n n Express Top Up Mini. Mart opportunity: n. Multiple brands per category • Aisles with category headers • Specials promoted on exterior of store Range: rte meals, emergency categories Range all food and grocery categories for top-up shops Meals destination in store Sign ‘what’s new’ for the locals Ensure telco offer is visible Staff incentives around basket size increase promotions eg drink + something else Emergency Category headers to make emergency purchases easy to find

Dual C&P Variation/Emphasis n n Queue paramount Tradies and truckies Meals and services Milk, bread, newspapers Implication n n Merchandise destination items in the queue – messaging and POS by daypart/occasion Tradies and truckies lunch deals Destination meal area of store Total Services offer for women – oil, water, tyre checks with while-u-wait coffee and car wash Services Increasing service portfolio drives frequency and destination: • DVD rentals (since they’re there for snacks anyway!) • Lottery • Dry cleaning • Photo processing

Petro Only Variation/Emphasis n n The basics expected, anything else a bonus All about auto Services and cravings Younger shoppers Implication n n n Merchandise destination items in the queue – messaging and POS by daypart/occasion Auto care products merchandised in the queue, staff persuasion for add on sales – coolant, oil etc Services for women – oil, water, tyre checks Telco products merchandising Drinks biggest opportunity/craving – ensure coolers in queue/front of store Ensure basics covered – adequate lighting, clean, uniform fixtures, merchandised queue, and shoppers can see in! Services Driveway service (for women): • Water, oil and tyre checks etc (at a fee!) • Cross promote with while-u-wait coffee Applies to Dual C&P also

Summary n Leverage dayparts natural shopper occasions and n Make it easy for them – overdeliver on solutions n Tailor execution by channel segment.

Questions? Norrelle Goldring Lee Mc. Allistair M: 61 -411 -735 190 M: 61 -414 941 585 E: norrelle@moxiemarketing. com. au E: lee@moxiemarketing. com. au 3 Burton St Linley Pt NSW 2066 P: 61 -2 -9427 7473 W: www. moxiemarketing. com. au Thank You.