Though restaurants have struggled immensely during the pandemic, fast food establishments have done quite well for themselves. The grab-and-go nature of fast food restaurants made them a good bet at a time when social distancing was necessary, and a lot of these businesses saw a surge in drive-thru orders in particular.
But now, as vaccines roll out to the general public and things begin to improve on the coronavirus front, customers are increasingly going back to making in-store purchases, and that means they're setting foot inside fast food joints rather than limiting themselves to the drive-thru alone. They're also visiting convenience stores more frequently. And one such chain is hoping to capitalize on that in a very big way.
A new beverage program to lure in customers
Convenience store chain Circle K has launched a new beverage subscription program called Sip & Save, following the lead of other chains that have tried this model before, like Burger King and Panera Bread. Customers can pay $5.99 per month and enjoy one tea, coffee, slushie or fountain drink of their choice every day as part of their subscription.
The point of the Sip & Save program is to encourage customers to visit Circle K stores and help retain their loyalty. During the pandemic, consumers visited convenience stores less frequently, and while part of that may have had to do with the fact that so many people worked remotely and therefore didn't pass those stores on the way to their jobs anymore, safety concerns likely played a role, too. But with those waning, Circle K now has a prime opportunity to capitalize on a return to in-person visits.
Circle K has actually been testing its Sip & Save program over the past three months in over 100 stores in Georgia and South Carolina. And so far, the data speaks for itself: Customers who sign up for the program are coming into those stores more frequently. But they're not just coming in for drinks -- they're also making food purchases to go along with them, which was the intent of the program all along.
Incidentally, Circle K is also in the process of upgrading its hot food items. And over the next year, it has plans to bring its expanded offerings to an additional 3,000 locations. It also plans to tailor its menus so they align with local tastes and cuisines.
Will this new program threaten fast food joints?
For now, Circle K is planning on running its Sip & Save program for 90 days. But if it proves successful, it will likely keep it in place longer. And that could, in turn, take a fair amount of business away from fast food restaurants as well as coffee shops. Of course, if those establishments lose too much business, they could be forced to shutter, at which point the commercial landlords they rent from could be left to deal with vacancies and losses in revenue.
Now one thing fast food joints and coffee houses have going for them is that they offer customers the chance to consume their purchases in person. And after a year of staying out of restaurants, many people are no doubt eager to meet up with a friend and chat over a cup of coffee. Circle K, by nature, doesn't lend to that social aspect, so while its beverage program may be cost effective for customers, it may still end up falling short. Ultimately, only time will tell, but if the model proves successful, more convenience stores may seek to emulate it -- and drive more business away from fast food chains and coffee shops as a result.