How Young Consumers Are Driving Convenience Store Shopping
How Young Consumers Are Driving Convenience Store Shopping

Global convenience store market has been growing rapidly along with te rising income and improving lifestyle across the globe. Convenience stores in India are still at a nascent stage, providing huge untapped market potential for future growth. Currently, convenience store market is approximately valued at INR 1 bn and is expected to grow at a CAGR of 2% to INR 3 bn in 2018.

In 2012, India´s central government approved retail reforms and these market reforms paved way for retail innovation and foreign direct investment in single- and multi-brand retail. Today unorganised retail (independent local stores) still amounts for over 90% of the market and the typical Indian retail shops are very small. In fact, over 14 million outlets operate in the country and only 4% of them being larger than 500 sq ft in size. However, according to PWC organised retail is growing by 15 to 20% per year and there are multiple brands driving this development – also in the convenience retailing space.

The prediction has been realized, but convenience stores, not large supermarkets, are the favored channel.

How Convenient It Is?

Market analysts have found that consumers now prioritize convenience when choosing shops. They are no longer excited about the opening of new hypermarkets as they were in the past, but often prefer to shop at convenience stores near their houses. 

Supermarkets and hypermarkets impress people with colourful opening ceremonies and good interior design, but the products displayed are nearly the same. Instead of spending time driving to large supermarkets and paying for products she does not need, it is better to go to convenience stores nearby. Convenience stores offer the most essential goods, so she avoids wasting money on unessential items.

Samir Modi, Promoter, 24*7 is passionate and serious about his ambitions for India convenience retailing. They have an innovative app with product specific loyalty and couponing mechanics.  He says,” We appeared to 7-Eleven in the Nordics as a global best practice on mobile marketing and the team is setting the standards for digital customer engagement in the Indian market.”

"We have changed our technology across the stores. We have invested Rs 30 crore last year on technologies like point of sale, analytics, syncing online and offline and empowering the manager”, Modi added.

If convenience stores want to compete and grow, they will need to increase their share of the food-service market, including adding healthier options.


Younger consumers (ages 18-34) are overwhelmingly more favorable toward convenience stores than other age groups. Convenience stores have become the preferred shopping destination for the Indian urban consumer demanding for convenience, quality & service. Unlike other options, the ease of grabbing food with an array of display pertaining to the likes & dislikes of the consumers is considered to be the most preferable one.

Consumers are also more aware of the convenience store industry’s efforts to provide fresh, healthy food. Mostly scattered around the towns, consumers are trying their hands on products in the most convenient way possible, with more speed and easily portable.

As compared to sales & penetration, hyper markets are losing the game to convenience stores, as more and more people, especially the young ones are highly favorable of this emerging channel.

Lagging Behind

Convenience stores in India are only 75% as efficient as stores in the US in terms of display, accessibility & service. Convenience stores are expensive as compared to other local stores. With variety of options under one place, the prices are high i terms of the quantity & quality. Food products expire, even if they are well-preserved. You can limit these losses somewhat by stocking snacks and drinks that have extended sell-by dates, but it can never be completely eliminated. Even when your customers are purchasing popular products on a regular basis, all it takes is one lull in the action to have an entire inventory purchase go bad on you.

Caring about the people who frequently visit the store will give it a strong reputation in the neighborhood. Once you achieve that, you can begin building a foundation for long-term success.

Shashwat Goenka, Chairman, RP Sanjiv Goenka Group says,” Grocery modern trade itself was a nascent industry at the time and both consumers are retailers were grappling to find a suitable business model. Some of the key learnings I had early on were the unpredictability of retail, and that India is extremely diverse from a consumer preference standpoint, and one size does not fit all.”

Influencing Consumers

In India, the digitally connected younger generation is driving the trend for increased visits to convenience stores. These smaller households are focused on shopping for what they need over the next couple of days, and they’re heading to smaller stores to get it.

When asked about the consumer demands, Goenka said,” The Indian consumer is gaining more exposure through easier modes of travel to other parts of the world, as well as through social media and the internet. Hence, their demands for more global products and more refined products to meet their specific requirements are also increasing.”

The increased availability of fresh and healthy products in convenience has changed significantly over the last two years, and c-store retailers have continued to invest in refrigeration to meet growing consumer demand—but there is still significant room for growth in this area.

“Our stores offer an international shopping experience stocking wide variety of products and provide an array of services, round the clock”, Modi said.

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