Navigating Growth in Convenience

The UK convenience channel has witnessed remarkable growth to £47.1bn in 2023, only slowing slightly vs. the previous covid affected years. It’s expected to grow by a further £3bn to £50.9bn by the end of 2026. This surge has been driven by evolving consumer preferences and an ever-changing retail landscape and is expected to continue, propelled by dynamic shifts in various product categories. With 42% of the channel having less than 1,000 sq. ft of space, a strategic combination of short-term field sales activities and innovative digital solutions like *shopt becomes imperative for brands looking to gain and maintain sustainable distribution in this competitive market.

1. Evolution of the UK Convenience Channel:

Over the past year, the UK convenience channel has seen a significant transformation, shaped by consumer demand for convenience, health-conscious choices, and a preference for local products. Whilst tobacco and alcohol remain as the two top value categories, categories such as fresh and chilled foods, snacks, and beverages have experienced notable growth. As the convenience sector expands further, brands need to adapt to these changing dynamics to stay relevant and capitalise on emerging opportunities.

2. Implications for Brands:

For brands navigating the crowded shelves of convenience stores, the evolving landscape brings both challenges and opportunities. With consumers seeking convenience without compromising quality, brands must strategise to secure prime shelf space and stand out amidst the competition. Local decisions on product stocking mean that distribution changes frequently - 70% of stores are independently owned (with 90% of these being <10k sq. ft) – so brands need to both earn their space initially but generate appropriate rate of sale vs. their POR to ensure products remain on shelf. In this environment, it's crucial for brands to not only focus on product innovation but also leverage field sales and digital solutions to establish and maintain a strong presence.

3. The Role of Field Sales in Distribution Growth:

Field sales play a pivotal role in supporting brands aiming for distribution growth. Leveraging the expertise of field sales teams, brands can establish direct relationships with retailers, ensuring that their products are not only stocked but also positioned strategically within stores. The hands-on approach of field sales fosters collaboration, provides real-time market insights, and facilitates the swift adaptation of strategies based on on-the-ground feedback. Cosine’s Connected model, which engages with retailers both physically and digitally improved interactions in 2023 by 11.9% vs. 2022 ensuring that brands can speak directly to their customers more often.  

4. Digital Apps and Distribution Expansion:

In the digital era, apps like *shopt are becoming indispensable tools for brands seeking to expand distribution efficiently and deepen their engagement with retailers across the country. *shopt offers a seamless platform that connects brands with retailers, streamlining a direct reward process and creating lasting advocacy for brands and products. Digital engagement is on the rise in convenience retail, driven by a generational shift in store ownership, with 50% of store managers/owners now under 40, and consumer demand, which has led over 30% of stores to offer an ‘online’ purchase option either self-delivered or through established services like Uber Eats.

5. Creating Advocacy Through Combined Services:

The synergy of field sales activities and digital apps doesn't just stop at distribution growth; it extends to creating brand advocacy among shopkeepers. Field sales teams build personal relationships with retailers, fostering a sense of trust and loyalty. When coupled with the convenience and efficiency provided by digital apps like *shopt, this combination enhances the overall experience for retailers, making them more likely to advocate for and support the brand. The synergy also allows brands to use their budget more efficiently; reaching more retailers, more often and delivering better returns from every engagement.  

In conclusion, navigating the complexities of the UK convenience channel requires a multifaceted approach. Brands must adapt to the evolving landscape by combining the power of field sales activities with digital solutions like *shopt. Through combining these services, brands not only secure sustainable distribution but also grow advocacy among retailers. This connected strategy positions brands for success in a rapidly growing and competitive market, ensuring they stay ahead of the curve in the dynamic UK convenience channel. 

Sources 

The IGD 

The ACS 

Mintel 

Blog Author Tim Harris, Business Unit Manager