“C-stores will have to battle e-commerce and discount”. Interview with Director of NACS Europe

We sit down with Mark Wohltmann, Director of NACS Europe, to discuss Convenience Summit Europe, NACS' goals for this new phase in Europe, and the general situation of the convenience sector in the continent.

Mark Wohltmann is the new Director of NACS Europe. He is responsible for the strategic development of the NACS brand on the old continent. Prior to NACS, Mark worked with the Nielsen Company, where he held the position of Director Product Management Europe. NACS, founded August 14, 1961, is an international trade association representing more than 2,100 retail and 1,600 supplier company members.

Q: You just took over the new position of “Director Europe”. What is NACS’ goal in coming over to Europe?

A: In a sense we are not really “coming over”, but have already been here all the time. Convenience is a very connected global industry and as NACS we have always been very engaged in the different markets to provide knowledge, identify best practice, meet with industry leaders to learn and connect, and to support local associations in their local advocacy efforts by being an advocate for the industry ourselves. And this is not going to change, we will just intensify what we already are doing, together with our partners.

Q: You have referred to ‘providing knowledge’, what can the US learn from Europe? And vice versa?

A: Our experience tells us convenience retailers face very few unique regional or country-specific issues; rather each country experiences a different phase in the life cycle of each issue affecting the market. US retailers e.g. can learn from the aftermath of European tobacco regulation or from the vast variety of highly innovative new store-formats in Europe’s metropolis. European retailers, on the other hand, can learn a lot from the US, as the sheer size of the convenience market over there has brought up some of the most profitable and innovative convenience players in the world. In the end it all comes down to sharing knowledge, providing thought leadership and insights, and to bring the industry together in a European Convenience Community.

Q: How does the ‘Convenience Community’ bring the industry together? What’s behind that?

A: One key task of any association is to help connect people. If you are a single-store operator, the owner of a small chain or the CEO of a multi-country operation, you have a limited amount of time to spend networking, so it is necessary to spend it on meeting with the right and relevant people in an efficient way. You want to meet your peers to discuss trends and learn from other’s experience. We are helping to connect our members with their relevant counterparts and make the most of their time spent. This is why in the US we have the annual NACS Show, which is a combination of being a trade show, an annual member-meeting, offering open sessions for everyone, as well as a place to have 1-2-1’s.

Q: As part of strengthening your position in Europe, are you planning on having a “NACS-Europe-Show” then?

A: Not in the way we do it in the US. Our European members are mainly multi-store chains and multi-country operations. They are asking for thought leadership and insights on a global scale and that is what we are offering. We do have our annual, European member-meeting, including an open conference where everyone is welcome to join. This event that we call “Convenience Summit Europe”, as we have a similar event in Asia, is taking place in London every year, with a store tour before the event in a different city in Europe each year. In 2017 we will be in Zurich and London. In addition, while we are expanding our community in Europe, we will offer multiple platforms, online and offline for our members to meet, inform, and share.

Q: We have talked about promoting knowledge and connections in the industry. What about advocacy? Is NACS planning to get involved in government relations in Europe?

A: In the US, government relations are a big part of our advocacy strategy. In Europe we support the existing associations with our knowledge and connections. But advocacy also means ‘being an advocate for the industry’, i.e. talking positively about it. And that is what we do in the US and are planning on getting involved in Europe much more. An example from the US: When Michelle Obama first moved into the White House, she didn’t have much good to say about our industry that sells fuel, alcohol and sugary sweets… But by the time she moved out of the White House she was full of praise for a sector that keeps consumers moving, that plays an important role in the neighborhood community and that quite often helps keeping children off the streets. I won’t say that this is just our success but communicating and making sure people – lawmakers, influencers – know about the value of the convenience sector for society, that is what ‘being an advocate’ is about.

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Q: Where do you see the convenience sector heading in Europe?

A: There is a certain path of retail development that occurs in most markets. It all starts with simple neighborhood sales, via organized retail, and then to large scale hypermarkets. The next step after that can be seen in many developed markets: The anonymity of hypermarkets is being rejected by more and more consumers and they are looking for advanced, modern, local neighborhood stores – a place where they know who is selling and where they sourced it from. Market data shows growth in Europe for e-commerce, discount and small stores, the latter basically meaning convenience-retail. So the market for convenience stores in growing, but ahead lays the battle against e-commerce and discount, and it will be a tough one.

Q: There are new convenience store concepts every day around the world. Perhaps one of the most innovative is Amazon´s new physical stores with no counters or cashiers. Could this be a threat to other convenience retailers?

A: The Amazon concept offers convenience by embracing technology, which is not a bad thing. Technology is progressing and retailers will have to embrace it. However, this kind of concept won´t become the norm until way down the road. I believe the effect will be positive, as these innovative companies will push competitors to improve instead of being a threat to them.

One key technological step forward is the development of selective marketing, which is amazing. By using this you can really target messages to specific customers, therefore improving overall sales and customer experience. I expect this trend to increase in the coming years. Retailers can enhance their loyalty programs by using targeted promotions. It is a ‘win, win’ situation for both, retailers and customers.

Q: Do you think systems such as pay at the pump or in-car payment technology will translate in lower sales at the store?

A: Pay at the pump is good for the overall business. You will always have people who just want to fuel up, and if you annoy them by making them wait, they won´t come back. Also, there are new ways of communicating with the consumer without the need them of entering a store: technologies such as TV at the pump allow for retailers to push promotions while people fuel up. Stores have less people waiting in line and become more appealing and pleasant to those who do want to purchase an item.

Q: Are there any European countries that are taking the lead in terms of offering the best convenience possible?

A: There is no country that really stands out from others in an overall sense. In all of them you can find interesting concepts and ideas. For me, it comes down to the degree of organization and size of the companies. Independent retailers are more innovative as they can adapt to market trends a lot faster than large ones. At the same time, we do see some large companies, using their strength of corporate operations to push out those ideas that work through the whole network.

Q: What advice would you give to the industry?

A: As they say in the movies: “Lock ‘n load. It’s gonna be a bumpy ride.” In Europe we face many unknowns: politically, economically and fiscally. Our society is changing. Hot topics are basic salary, algorithms that will take over white collar jobs, and how far globalization should go. So it is going to be a bumpy ride. Things will change, but if there is one sector that has shown in the past how to successfully deal with change, that is convenience retail. But we need to get ready for it, so ‘lock ‘n load’, get prepared, be informed, get connected and stay engaged.