7-Eleven’s new RTD line shows how convenience store coffee is evolving

  • 7-Eleven just launched a new line of flavoured RTD coffee drinks, joining a C-store trend of better quality and differentiated products
  • 82% of convenience services operators sell coffee, but now they’re using it to get customers to buy into broader fancy food and beverage propositions and a different space
  • RTD coffee rivals energy drinks and sodas in the C-store as it offers the convenience, premium quality and customisation that Gen Z craves

7-ELEVEN’S latest move to launch a new line of flavoured ready-to-drink (RTD) coffee beverages signals a significant shift in the way convenience stores (C-stores) are approaching their food and beverage selections. 

This strategic manoeuvre underscores a broader trend within the convenience sector towards diversification and a commitment to offering higher quality products to meet evolving consumer preferences.

The announcement of 7-Eleven’s flavoured RTD coffee line comes at a time when convenience spaces are facing mounting pressure to differentiate themselves in an increasingly competitive market. 

No longer satisfied with simply being a one-stop shop for snacks and sodas, C-stores are expanding their offerings to include a wider variety of food and beverage options, with a focus on quality, freshness, and customisation.

“In the US, the environment in C-stores is one where there’s a lot of innovation right now, as a range of operators look to upgrade and expand their foodservice programmes,” says Gavin Rothwell, Director and Founder of Food Futures Insights

“Whether it be Casey’s strengthening its offer beyond its core pizza proposition, TXB adding its foodservice programme to more of its locations, or 7-Eleven adding new foodservice lines across both food and drinks, there is a lot under way.”

Coffee has always been a popular beverage offering in C-stores. According to the NAMA Foundation’s latest survey, 82% of convenience services operators sell coffee, with 36% offering coffee in most or all micro markets. But now RTD coffee is emerging as a competitor to its more traditionally popular beverage categories, like soda and energy drinks.

“Across the C-store sector, we’re seeing a strengthening focus on developing better coffee solutions,” says Gavin.

Convenience stores are getting fancy   

Convenience stores are synonymous to most with cheap, low-quality products in flashy packaging. This makes the consistent push in recent years to increase coffee quality in the C-store a surprising pivot.

There is a growing demand for better quality overall – not just in coffee. Shifting consumer expectations and preferences are forcing convenience sector players to pivot their strategies to stay relevant and profitable. 

As consumers become more health-conscious, C-stores are adapting to meet these changing demands. Even gas station convenience store customers are increasingly looking for healthy alternatives to their “favourites”, which tend to be high in calories or sugar.

By offering higher quality options, C-stores are able to attract a broader customer base and compete more effectively with other foodservice outlets. This trend is also a response to other changing externalities, especially for gas station stores.

“Forecourts (stores in fuel locations) overall are increasingly rethinking their ‘raison d’être’,” says Gavin. “Fuel sales will slow. For those with the right location, footprint and ability to invest, there will be an opportunity in charging (electric cars).”

“That in itself brings with it different dynamics than traditional fuel purchases, and crucially a longer dwell time. Creating food and beverage experiences on the roadside is therefore an increasingly attractive avenue of development, and we expect more activity here in the future.”

The rationale for C-stores overall is similar. Their traditional core categories are diminishing in importance. This raises the question of how they can drive revenue and growth in the future.

Better quality food and beverage options appear to be a winning recipe. Across Europe and North America, coffee underpins broader food-to-go propositions – making it the perfect gateway to higher quality offerings, and higher sales. 

Gavin highlights Ireland as a great example of combining convenience and premium quality coffee, with Musgrave’s Centra (Ireland’s leading convenience brand) and Applegreen developing their own house coffee brands, with considerable success, respectively with Frank & Honest and Braeburn.

Reitan Retail, a leading retail company in the Nordic and Baltic countries and the business behind the 7-Eleven Denmark, is expanding its organic coffee chain Caffeine into drive-thru concepts. Convenience and quality are merging across the board.

RTD coffee is at the crossroads of quality, convenience, and customisation 

RTD coffee has emerged as a go-to beverage choice for consumers seeking convenience. With its portability and wide range of flavours, it is rapidly rivalling more traditional convenience store offerings like energy drinks and sodas.

It also has a quality proposition that aligns with a shifting consumer demand towards convenient products, but with better quality and ingredients

“Globally, more consideration is going into the coffee proposition overall, and operational and product standards are improving,” says Gavin. “We actually see a lot more opportunity ahead for those with the right propositions.”

Meanwhile, convenience stores are increasingly scaling their coffee portfolio to target a wider range of consumers, with a heavy focus on younger people.

This makes way for new lines of customised, flavoured, usually sweet RTD coffee drinks that fit perfectly in a C-store setting. They meet Gen Z demand for variety and personalization, catering to individual tastes and preferences and essentially offer “Starbucks in a can”. 

It’s no longer just coffee brands recognising this push from consumers to have RTD coffee “their way”. Other sectors are picking up on it too – increasing evidence that it’s a train retail actors need to hop on. 

“There’s a need to differentiate in coffee,” says Gavin. “Offering the same solution as your competitors is seldom a recipe for long term success.”

“Right now, we’re seeing a considerable focus on syrups, and customised and cold drinks from Starbucks. And while these solutions are often custom-made, there’s considerable opportunity in RTD products as well, looking to bring this same level of excitement to C-store shelves.”

By offering higher quality products, diversifying their offerings, and embracing trends like flavoured RTD coffee, C-stores are positioning themselves for success in an increasingly competitive market. 

As consumer preferences continue to evolve, the convenience sector will need to stay ahead of the curve and continue innovating to meet the demands of their discerning clientele.

Coffee Intelligence

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