By offering strong additional services, c-stores can attract more evening shoppers. Aidan Fortune reports.
We may be living in a 24-7 society, but the person who coined that phrase has probably never had to post a parcel after 6pm.
Finding a Crown post office open after dark can be an impossible task for anyone working an ordinary 9 to 5 day. It’s equally challenging for consumers to find a bank open at night if they need to pay their bills. And this is where convenience stores come in.
By their very nature, convenience stores offer their services after everyone else has closed, providing - you guessed it - a convenient outlet for purchasing goods and services when customers actually need them.
Long hours for a retailer are nothing new, and given that the rest of the business world hasn’t yet caught up on the fact that consumers want to shop or sort their affairs at a time that suits them, means there is significant opportunity for store owners to offer additional in-store services you just can’t get anywhere else after 5pm.
The Association of Town and City Management (ATCM) has long called for retailers to take full advantage of their longer opening hours. Alex Smith, the night-time economy manager at the ATCM, says areas that have introduced late-night trading have seen increases in footfall and customer spending.
He reveals: “We have seen evidence of retailers taking in up to 40% of their daily sales after 6pm and none of the retailers we spoke to would go back to regular opening hours,” he says. “We have also seen that it’s not just the same daily income spread out over a longer period, but that income on average increased by 10% when stores changed to longer opening hours.”
Costcutter retailer Chaz Chahal believes there is huge potential in focusing on services in the evening. His Bromsgrove and Kidderminster stores in Worcestershire are open until 10pm and 9pm respectively, and he says there is a steady flow of customer traffic right up until closing time. He has a wide range of services in his stores including PayPoint, Payzone, National Lottery, Health Lottery and dry-cleaning, as well as being one of the first UK stores to offer the MyHermes parcel collection and drop-off service.
Chaz says that offering additional services is an opportunity for retailers to introduce your store to new customers. “All stores will have their core customer base who know it and will come in regularly,” he says. “But if you have services that people need and there’s nowhere else open, they’ll be coming into your store possibly for the first time, and you’ll have a chance to show them how good your store is. There’s a great opportunity to turn these customers into regulars.”
From morning till night
As part of its Network Transformation Programme, the Post Office has introduced a Local model, which is run through the main till of a store, allowing it to offer post office services whenever the doors are open. According to Post Office research, 15.5% of customers are visiting branches outside traditional hours and these extended service times have led to an average retail sales increase of 10% being reported across new-style branches.
The programme’s main objective is to make post offices ‘easy to do business with’, and longer opening hours are seen as an essential part of that to fit with people’s lifestyles.
According to Post Office head of Network Transformation Programme Neil Ennis, the branches that have converted are now offering an additional 17,500 hours of service between them - the equivalent of 382 new branches open for traditional hours.
“Services are available for longer - an average 87% increase in opening hours - and customer satisfaction scores have been consistently around 95%, according to independent research.”
While it may seem that offering late-night services is something that will only work in a big city, Ennis says that’s not the case and that evening openings are just as important in rural areas.
“Piccadilly Plaza in the busy heart of Manchester is a main-style branch, offering continuous access to post office services from 6am on Friday morning until 10pm on Sunday night, because it is in an area with a 24-hour economy,” he says. “But even in rural areas, being ‘open all hours’ is important for customers. In rural Trawden Forest, Lancashire, the Local-style post office and shop play a crucial part in everyday life in the village. The branch opens seven days a week with a single service point open from early in the morning until late at night.”
Max Matadar of Londis Piccadilly in Manchester is another recent convert to the night-time economy. His store recently started offering post office services from 6am, when the store opens, until 10pm when it closes. Max also opens 24 hours over weekends, and plans to extend the weekday opening hours to midnight in the coming weeks.
“We’re located in the heart of Manchester with lots going on at all times, and as well as grocery shopping at all hours of the day, people are looking to use additional services such as the post office outside of normal working hours,” he says.
He claims that customers are already using the post office late at night. “It’s amazing to see customers come in late at night needing a post office service,” says Max. “We’ve only had the service running for a month, but it’s created a lot of footfall and many of them have already become regular customers.”
Parcel collection and delivery is a real winner for stores that stay open late, offering the potential to attract new regulars, says Catherine Woolfe, marketing director at Collect+. “Almost two-thirds (64%) of customers have stated they had not used the store for other visits or purchases before using the Collect+ parcel service.
“With nearly 50% of Collect+ customers stating that they purchase other items from the store, as well as 63% stating they will use the store again, ensuring that local people are aware of the service is crucial to boosting footfall and securing incremental business.”
MyHermes head of marketing Jonathan Bennett agrees that parcel collection delivery is a perfect service for small businesses to offer.
MyHermes ParcelShops is proving extremely popular with small businesses, niche online retailers, ebay powersellers and anyone who wants to post a parcel and who doesn’t want to take time out from their busy day to stand in a queue at the post office,” he says. “Some 28% of parcel transactions take place outside traditional working hours during weekdays, with a further 10% occurring over the weekend.”
He believes there is an opportunity for retailers to exploit this. “As awareness of the service continues to grow through local publicity and prominent point of sale there is significant scope for growth. In addition, a collection service will be introduced later this year enabling online consumers to specify a MyHermes ParcelShop as an alternative delivery address, which will only increase volumes further.”
Chaz says that a service such as MyHermes serves two key types of customer at his store.”There are the small businesses who trade through ebay and will use the service quite often during the day, and then there’s the people who are returning items they’ve bought online who will use it more in the evening after work,” explains Chaz. “These are the additional customers - the new ones that you have the opportunity to win over into regulars.”
PayPoint retail director Andrew Goddard concurs that every night-time customer in search of in-store services is an opportunity for a retailer.
“Certain payments that can be made at PayPoint are often urgently needed by customers out of ‘normal’ hours.” he says. “This particularly applies to gas and electricity meter pre-payments, which customers may need to make at all hours. It is, therefore, a major benefit to retailers to be able to offer their customers PayPoint late into the evening to enable them to top up their meters. Inevitably, customer choice for many goods is reduced in the evening and later into the night, so offering PayPoint turns the shop into a more desirable destination to buy top-up goods. Every one of these visits is another opportunity to cross-sell and encourage impulse purchases, especially of products more oriented to night-time consumption.”
Goddard says 35% of PayPoint transactions take place outside traditional office hours of 9-5.
“About 27% of transactions take place between 5pm and midnight, and a further 8% between midnight and 9am,” he says.
But what types of services are people buying after dark? According to Goddard, shoppers are primarily looking for a late-night top up.
“There is little variation between type of transaction, though the proportion of both energy pre-payments and mobile top-ups taken later in the day is a little higher than the average, at about 30% between 5pm and midnight; a further 10% of mobile top-ups and 7% of energy top-ups are bought between midnight and 9am,” he explains.
“In total, this represents about 3.7 million visits every week to PayPoint shops by customers wanting to use the service outside the traditional 9-5 business hours, often up to midnight.”
E-money products, such as pre-payment cards and Ukash, are especially popular in the evenings, with 40% of these type of transactions taking place between 5pm and midnight, he adds.
Shout about it
Of course, there’s no point in offering after-hours services if no one knows about them. Goddard says marketing the fact that you offer these services is vital. “Some retailers are successfully using social media to promote their business, and opening hours should be part of the messaging,” he says.
In Manchester, Max uses POS material to promote the fact that customers can use postal services whenever the store is open. “We have signs outside the store letting them know our extended opening hours and we tell every customer that comes in that our post office is open whenever we are,” he says. “Even if they don’t need it that day, they may need it at some point in the future, and hopefully they will remember that you’re open late and they can get what they need at your store.”
MyHermes’ Bennett agrees. “Word of mouth is a powerful tool, so we encourage each location to talk with people entering the shop about their requirements and to make them aware of the services that are available,” he says. “Our best performing MyHermes ParcelShops are those that proactively promote the delivery service to existing customers and local residents and businesses.”
There’s no denying that offering additional services takes up time and space, and deciding which ones to take on takes careful consideration. “You don’t want it to overtake your core business with staff spending more time on a service than serving customers,” says Chaz. “While every service is important, you can never ignore the main elements of the business or give up too much space so that it takes away from other categories. Find the right level of services for your store that you can perform efficiently without disturbing the rest of the business.”
But despite the obvious challenges involved in offering additional services, the benefits speak for themselves. And after all, a convenience store needs to live up to its name. Says Max: “You need to be able to offer services that others can’t or won’t when people need them, and that’s not always between the hours of 9-5.”