American, Canadian-owned multinational supermarket chain.
Budrul Chukrut | LightRocket | Getty Images
The convenience store chain Circle K is launching a beverage subscription program that is following in the footsteps of Burger King and Panera Bread.
Starting Wednesday, US customers paying USD 5.99 per month can enjoy a tea, coffee, frozen slushy, or polar pop fountain drink of their choice every day.
Circle K’s Sip & Save program aims to build loyalty on a regular basis and draw people back into its businesses. During the coronavirus pandemic, consumers made fewer trips to convenience stores.
The sale of self-service beverages has been successful across the industry. Hot beverage sales fell a third, while cold beverage sales contracted 7.9%, according to the National Association of Convenience Stores.
“We really see this as an opportunity to drive traffic at a time when people are just starting to get out of the understandable cocoons they’ve been in for over 12 months,” said Kevin Lewis, chief marketing officer, Alimentation Couche -Tard, the parent company of Circle K.
Couche-Tard, based in Montreal, operates more than 7,200 convenience stores in the United States, including other brands such as On the Run and Holiday. The company had US sales of $ 37.8 billion in 2020.
Circle K had plans to roll out the program last year, but the pandemic hit and health officials urged consumers to stay home, Lewis said. Now the consumer environment is changing again as Americans get vaccinated and states relax restrictions.
The Sip & Save program has been tested in more than 100 stores near Augusta, Georgia and Columbia, South Carolina in the past 90 days. According to Lewis, data from the study shows customers are visiting more often and exceeding Circle K’s expectations.
Test customers also bought groceries with their drinks. This is good news for the convenience store chain that is improving its hot food options. During the crisis, new items were introduced at around 1,500 locations. It is planned to bring the improved menu to a further 3,000 locations in the next year. Circle K adapts the menu to the location, like serving tacos in Texas.
Wawa, 7-Eleven and Sheetz have also revamped their fresh food offerings in recent years to capture market share from fast food restaurants. The hope is to increase sales from customers who are already buying fuel, staples, or packaged snacks in their stores. As in the catering industry, however, food sales in convenience stores weakened last year due to the pandemic.
Lewis said the drinks subscription’s low price was the chain’s way of thanking its customers and celebrating the end of the pandemic. Panera Bread launched its coffee subscription last year to lure customers into its restaurants in the morning hours in hopes of getting a taste of the chain’s new breakfast items. Restaurant Brands International’s Burger King launched its version of a coffee subscription in 2019 to convince consumers to try the revamped Java. The burger chain quietly ended its program after a few months.
Circle K currently plans to run the Sip & Save program for 90 days.
“But if the feedback we get at the national level at the end of the 90 days is the same, we are unlikely to be able to stop,” said Lewis.
