Dive Brief:

• Arko Corp., parent company of c-store company GPM Investments, has seen a 30% boost in weekly loyalty enrollments since launching its updated fas Rewards program on March 29, President and CEO Arie Kotler said during the company’s first-quarter earnings call on Tuesday.
• The company now boasts 1.38 million members in its program, and said that its members made about six more trips to its stores per month and spent about $68.50 more per month than nonmembers. Members also grew their spending by about 8.2% month over month.
• The loyalty program is one of three pillars Kotler said Arko is focusing on, with the other two being sales in its “core destination categories” — candy; beer; sweet, salty and alternative snacks; and packaged beverages — and expanding grab-and-go and fresh-made food options.

Dive Insight:

Arko plans to further promote its loyalty program through an initiative called 100 Days of Summer starting May 17 that will offer an additional $10 in rewards to new members. 

“While [it’s] early, we are encouraged by engagement in the new app, including the redemption of our in-app-only hot deals, as well as [usage] of our new in-app order and delivery functionality,” Kotler said.  

The company is also seeing a trend toward fewer trips but larger baskets, which is part of why it’s pushing the loyalty angle, Don Bassel, chief financial officer, said in the call. 

Looking to Arko’s other pillars, Q1 same-store merchandise sales excluding cigarettes grew 7.6%, boosted by strong performance among some of its core destination categories. Notable increases included 18.3%, 16.5% and 15.8% in candy, sweet snacks and salty snacks, respectively. Almost two-thirds of the non-cigarette merchandise sales in Q1 were from the six core categories. 

Finally, Kotler noted that while the company has made progress on its grab-and-go, prepared and frozen foods and franchise partnerships with companies like Dunkin, the overall strategy is still taking shape.

“Our goal is to become a destination for packaged, prepared and fresh foods,” Kotler said. 

While Arko has no new M&A deals planned on the heels of its failed bid for TravelCenters of America, the retailer has expanded its credit line with a syndicate of banks led by Capital One to $800 million, giving it an additional $300 million. It also updated its agreement with Oak Street, a division of Blue Owl Capital, to an additional $1.5 billion. In that agreement, Oak Street purchases land by agreement with Arko, and Arko then agrees to a triple-net lease of the store. 

Richmond, Virginia-based Arko has more than 1,500 c-stores in 33 states under a variety of brands in its GPM Investments arm, including E-Z Mart, Breadbox, ExpressShop and Pride.