Consumers are increasingly demanding food service at forecourts to appease their growing appetite for food-to-go. This trend coupled with declining fuel margins is stimulating fuel retailers to develop better food service, either under their own brands or through partnerships. Specialist food service retailers are also keen to exploit the service station channel to tap the food-to-go opportunity.

1. SERVICE STATION RETAIL INSIGHT SERIES
Food Service at the Service Station
Channel in Europe
Consumer trends, competitive landscape, and strategies for success
Reference Code: CM00083-005
Publication Date: July 2012
OVERVIEW
Summary
With changing lifestyles, average time spent on meals is reducing while consumers' propensity for consumption on-the-
move is growing. Although consumers still perceive service stations primarily as refueling destinations, they are
increasingly demanding food service at forecourt outlets to appease their growing appetite for food-to-go. This trend
coupled with declining fuel margins is stimulating fuel retailers to develop better food service, either under their own private
label brands or through partnerships.
Fuel retailers are focusing on improving the quality and freshness attributes of their food service propositions and are
developing meal-oriented offers. Specialist food service retailers are also developing smaller retail formats suitable for
travel retail destinations and are looking for opportunities to establish their presence at service stations.
Food Service at the Service Station Channel in Europe examines the development of food service across Europe’s service
station networks in the context of the changing consumer trends and dynamics of the fuel retailing industry. It analyzes the
food service propositions and strategies of major fuel retailers in Europe and also profiles food service specialists for
potential partnerships.
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2. Consumer Trends and Market Context
Figure 2: The proportion of meal occasions conducted out-of-home and on-the-move in Europe will
increase by the end of 2014
Proportion of meal occasions conducted out-of-home (2011)
Proportion of meal occasions conducted out-of-home (2014e)
Proportion of out-of-home meal occasions conducted while on-the-move (2011)
Proportion of out-of-home meal occasions conducted while on-the-move (2014e)
45.0% 16.0%
Proportion of out-of-home meal occasions conducted while on-the-
40.0% 14.0%
Proportion of meal occasions conducted out-of-home
35.0% 12.1%
12.0%
11.9%
30.0%
10.0%
25.0%
move
8.0%
20.0%
30.6% 6.0%
15.0% 29.7%
4.0%
10.0%
5.0% 2.0%
0.0% 0.0%
France Germany Italy Netherlands Spain Sweden UK Europe
Source: Datamonitor Consumer Survey, Datamonitor analysis VERDICT RESEARCH
Breakfast is the most commonly eaten meal on-the-move
Typically, most people find themselves on the road in the morning and evening on their way to and from work. There has
been an increase in the average commute time as growing urbanization means that people are settling in the suburbs on
the periphery of the main cities and are traveling a greater distance each day for work. This coupled with rising traffic
implies that people are spending more time on the roads than before, and are often forced to leave home earlier than
normal, thereby missing the opportunity to have breakfast at home.
Moreover, the likelihood of feeling reasonably satisfied upon grabbing a quick breakfast-to-go such as a coffee and
croissant is much higher in comparison to having dinner on the go. People usually like to have a reasonably substantial
meal for dinner in order to feel satiated. Thus, consumers have the highest propensity to eat breakfast when they are on-
the-move, followed by lunch and dinner. Breakfast accounts for over 60% of all meals consumed on-the-move.
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3. Consumer Trends and Market Context
Figure 8: The proportion of motorists who would like more variety for various products at service station
shops in the Euro 8 region
Frozen food
Household goods
Grocery
Outdoor goods
Personal care products
Alcoholic drinks
Dairy products
Hot drinks (tea bags and packaged coffee)
Fresh produce
Ambient snacks
Confectionery
Tobacco
Soft drinks
Chilled snacks
Over-the-counter medicine
Bakery products
Lubricants and car products
Mobile top up
Hot food
Hot, ready-to-drink coffee and tea
News and magazines
0.0% 10.0% 20.0% 30.0%
Source: Datamonitor Motorist Survey VERDICT RESEARCH
By providing what consumers want most, fuel retailers will not only be able to leverage the growing opportunity in food-to-
go but will also be able to improve the overall consumer perception about forecourt shops. This can further help to win over
more skeptical consumers and grow shop profitability.
The need for food service at service stations varies across different consumer groups
Professionals on-the-move drive greatest demand for food service at service stations
Professionals who travel to and from work by car every day have a pronounced need for food service at service stations.
Mounting pressures at work and an increase in the average travel time mean that people often leave home early and have
less time to spare for a sit-down meal. Grab and go food options either for a particular mealtime (breakfast, lunch, or
dinner) or for an ad hoc snacking occasion are becoming increasingly attractive to professionals who strive to optimally
utilize every minute of their working day.
Aside from professionals who on average make one return journey per day, those people who by virtue of their work have
to make multiple short trips or high mileage trips during a working day tend to depend on food service available at easily
accessible service stations. For example, sales executives, consultants, and technicians are part of this group of intensive
motorists. Sometimes when traveling their expenses are borne by their employers, and thus they are less price sensitive.
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4. Service Station Retailers' Food Service
Propositions
Figure 23: Wild Bean Café meal deals in the Netherlands
Source: BP VERDICT RESEARCH
Despite operating a strong food service concept, BP faces stiff competition from the Dutch market leader Shell, which has
the largest network of 530 service stations and a strong food service offer. Shell is expanding its food service concept
Deli2Go in the Netherlands, which will further improve its market position. Other players such as TOTAL and Texaco also
have well-developed own-brand food service concepts. Given the tough competition, it is important for BP to expand the
food service proposition to more service stations and strengthen its market position.
BP is expanding the Wild Bean Café concept in Poland
In Poland, BP features the Wild Bean Café food service concept at over 200 service stations – half of its entire network of
402 sites in the country. In May 2011, BP introduced the concept at a dealer-owned service station for the first time.
Wild Bean Café offers a wide range of food and drinks in Poland including baguettes, sandwiches, rolls, sausages, hot
dogs, tortilla wraps, and chicken wings. Chicken-based snacks were introduced in April 2011 in direct competition with fast-
food chains such as KFC and McDonald's, and illustrated BP's focus to establish a complete fast-food offer to cater to the
growing demand for food-to-go in Poland.
In terms of promotional offers, Wild Bean Café offers meal deals for breakfast and lunch that include a sandwich and a
drink, similar to the offers in the UK. It also provides one loyalty stamp upon the purchase of a coffee, and customers can
get a free coffee after accumulating nine stamps. BP has also introduced a Wild Bean Café-branded thermal mug, upon the
purchase of which customers can use to receive a discount every time they purchase coffee at BP stations.
In addition, BP has a deal with multi-partner loyalty program Payback in Poland. Payback card holders can earn 50 loyalty
points upon a purchase worth €2.39 (PLN10) from a Wild Bean Café. The accumulated points can be redeemed against
various rewards available on BP's online catalogue including car washes at BP sites. This is an efficient way of promoting
another important forecourt service along with food-to-go products.
Research shows that in Poland over 28% motorists place a high level of importance on food service when choosing a
service station. The Polish forecourt food service market is under development, with several fuel retailers entering the
market and actively developing their food service propositions. PKN Orlen, the Polish market leader, has developed its
Stop Café and Stop Bistro food service concepts and is fast expanding them across its network of 1,714 sites. Statoil is
also offering its Made to Go private label food range in Poland.
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5. Service Station Retailers' Food Service
Propositions
By offering something as diverse as sushi, Statoil is also competing directly with quick service restaurants and food service
specialists that keep innovating with new and international cuisines in order to keep their menus novel and unique. No
doubt Statoil is challenging the commonly held notion that drivers do not expect to find and buy healthy food options when
stopping at a service station for a quick bite. While this may hold true for the majority of high mileage drivers, especially in
the commercial traffic space, fuel retailers cannot afford to overlook the overall consumer trend toward health and wellness,
which is affecting consumers’ choices independent of where they eat.
In February 2012, Statoil launched wholemeal bread at 180 service station shops in Denmark. Statoil has also launched a
new range of cinnamon-flavored pastries in Denmark, which are baked on-site and carry their own quality and taste stamp.
Statoil guarantees money back if customers do not like the pastries.
In Sweden, Statoil launched new baguettes in 2012, developed in association with the Swedish Association of Chefs. The
new products include baguettes with fillings of grilled vegetables and feta cheese and smoked sausage with herbs. During
2012, Statoil will be launching eight new products in Sweden.
In Norway, Statoil launched a new range of sandwiches under the Wasa brand and offered a free sandwich upon the
purchase of a VG newspaper during the first six weeks of 2012. In Poland, Statoil introduced two new flavors of muffins at
200 of its retail outlets.
In Scandinavia, Statoil's major push has been on coffee promotions
Figure 30: Statoil’s coffee mug promotion targets men and women with black and pink mugs
Source: Statoil VERDICT RESEARCH
In terms of promotions, coffee is one of the key focus areas for the fuel retailer. In Norway, Statoil has been promoting its
coffee through an unlimited offer over the last few years. Customers are entitled to unlimited coffee and other hot drinks for
free for one year upon the purchase of the Statoil-branded coffee mug worth €26.60 (NOK199). Upon the end of one year
from the date of purchase, customers can benefit from the offer for another year by purchasing the mug cover and lid worth
€19.92 (NOK149). Through this offer, Statoil has developed strong customer loyalty, which it leverages to drive custom for
other shop products. The "unlimited" component of the offer makes it very attractive to customers, as it clearly
communicates the value proposition. In 2012, Statoil launched another coffee mug worth €6.55 (NOK49) for those who do
not use the mug frequently, requiring users to pay a discounted price (€1.33 [NOK10]) every time they buy coffee. In 2011,
Statoil launched a limited edition range targeting men and women separately with black and pink mugs.
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