Could Walmart, Costco, & Kroger Become Some of the Largest EV Charging Centers in the US?

November 21st, 2017 by Loren McDonald

A future of vehicles powered by batteries will radically change how, where, and how often we “refuel” our cars and trucks. One of those shifts will be to charging electric vehicles at warehouse stores (also referred to as big-box stores, superstores, and hypermarkets) and supermarkets.

Charging electric vehicles (EVs) at supermarkets is of course not a new idea, with many chains such as Krogers, Hy-Vee, Harris Teeter, Whole Foods, Fred Meyer, Lucky’s, and many others offering Level 1–3 charging. Walmart began adding EV chargers at some West Coast stores in 2011 and through January of 2017 the company had added EV charging stations to more than 90 sites across the US, bringing their total to over 300 stations.

Costco launched EV charging in various locations in Southern California in 2006, but then ended the program in 2011 due to lack of use and costs to maintain.

Warehouse Stores & Supermarkets Are Ideal for EV Charging

While several supermarket and warehouse stores have dabbled in EV charging by adding a few chargers at various locations, the future could see these retailers emerging as some of the largest charging centers in the US, Europe, and elsewhere.

These stores, which have large footprints and offer a wide variety of groceries and merchandise, are a perfect fit for EV charging for several reasons:

Deep Experience Operating Gas Stations and Building Loyal “Refueling” Customers: Over the past decade, big-box retailers, grocery stores, and mass merchandising stores have been the fastest growing channel for gas stations. As of May 2016, there were 5,934 big-box retailers in the US selling fuel, according to Energy Analysts International (via NACS). These sites accounted for an estimated 14.5% of the motor fuels (gasoline) purchased in the United States and have sales volumes roughly double that of traditional retailers.



The top 5 US hypermarkets selling fuel, by store count, in fuels retailing are: Kroger (1,3 54), Walmart (1,323 stations), Sam’s Club (535), Costco (430), and Safeway (341).

A 2014 survey of US and Canadian motorists by Market Force International found that Kroger and Costco were in fact the top two most preferred gas stations.

While EV charging is clearly a different business than selling gasoline, customers will not be surprised when these retailers scale up the number of their charging stations.

Frequency of Store Visits: Consumers average 1.5 trips per week to supermarkets. Access to fast EV chargers can potentially increase the average number of visits per month.

Large Parking Lots: Big box retailers have parking lots with 100s of parking spaces. Costco, for example, requires a minimum of 750 parking spaces for its warehouse stores.

Locations Near Residential Areas: While often located in suburbs, big-box retailers are usually located within a 10–15 minute drive of surrounding residential areas.

Rewards and Membership Programs: Many of these retailers have membership or rewards programs that are ideal to integrate with charging access, benefits, and discounts.

Low-Margin Expertise: The supermarket business in particular operates on low margins, typically in the 1–3% range. If these retailers add EV charging in the parking lots, they could operate them at near break even, or use them as a loss-leader to drive repeat visits and longer dwell time.

Helping Solve the Multifamily Housing & Disadvantaged Community Charging Challenge

In the next 5 years, most EVs will have a battery range of at least 250 miles and then rise to 300 or more a few years later. Electric vehicles with adequate longer range means that for most drivers, 99% of their charging will likely be done at their residence, along interstate highways/autobahns, and at distant destinations such as hotels and resorts.

But charging at residences has two huge hurdles:



Many households either do not have easy access to a garage or electrical outlet or they live in apartments, flats, or condominimums that have yet to install EV chargers at all, or only a few with Level 1 or Level 2 charging. In the US, for example, 26 million households live in rental housing of 2 or more units. Secondly, low-income communities will likely be the last to both adopt EVs and have adequate charging stations installed. In California alone, there are more than 2,000 disadvantaged communities, according to the California EPA.

Workplace and public charging locations will provide some of the charging options for these underserved markets, but hypermarkets stand to become the largest providers for EV drivers without their own at-home charging access.

Warehouse Stores/Supermarkets Will Take Innovative Approaches to EV Charging

Already leaders in operating gas stations, as EV adoption grows significantly in the next few years, warehouse clubs and supermarket chains will begin taking innovative approaches to repeat their gas station success with EV charging. Following are some of the approaches we may see:

Free Charging: Stores may offer free or discounted charging if a customer spends above a certain threshold. The longer a customer is in a store, the more money they spend on average. EV charging can potentially extend customer dwell time. Research from Path Intelligence found that a 1% increase in shopper dwell time at a mall led to a 1.3% increase in spend.

To minimize abuse, parked cars might be assessed “penalty” charges if a car remains longer than a specific time period. Retailers may also partner with advertising-based charging networks like Volta and sell advertising to manufacturers’ products carried inside the store.

Branded Charging Networks: Initially, these big-box retailers will partner with the large charging networks such as ChargePoint, EVgo, NewMotion, and others to launch and deploy chargers and provide mobile apps and network access. Over time, however, these retailers might operate their own branded networks using a white labeled service and add the offering into their mobile apps.

Loyalty Programs: A key for these retailers is to find ways to keep customers loyal to their brand, and increase shopping visits per month and average spend on each visit. EV charging programs connected to a loyalty program will likely play a key role in achieving these goals, especially with customers who don’t have access to chargers at home. Expect retailers to offer free or discounted charging and other benefits for members of their rewards/membership programs. Program members with certain levels of status or membership may even have access to faster and preferred EV chargers located closer to the store entrances.

Coupons: When a customer parks and plugs in their EV, retailers will send push notifications to their mobile apps notifying them of a coupon good for a free hotdog, dollar off a pizza or other food, beverages, and merchandise. The coupons will be designed to increase the amount of shopping dwell time and spend per visit.

Detailing/Light Maintenance: Chains such as Costco and Walmart already offer tire installation services for vehicles. With the growth of EVs, look for them to add car washing/waxing/detailing and potentially light maintenance services such as rotating tires, changing wiper blades, and installing new brakes — all while your vehicle is charging and you are shopping in the store.

Cross-Selling of EV Chargers, Solar, and Battery Storage: Big box retailers such as Walmart, Costco, Home Depot, and others may use the branding visibility of EV charging stations in their parking lots to drive sales of EV chargers, battery storage, and solar installation inside their stores. Beyond signage in parking spots, retailers can send push messages to EV charging customers’ mobile apps to check out their EV, solar, and battery storage solutions in the store. Customers who buy one or more of these products/services might be offered preferred parking locations and free lifetime charging.

Hyper-Targeting EV Drivers: Marketing is all about customer data. EV charging usage data and customer profiles can be appended to customer purchase and behavioral data to deliver more relevant and timely offers to customers. And for the next 7–10 years when EV owners will be mostly early adopters and higher-income households, retailers can target these attractive segments to drive greater loyalty and increase purchase levels per visit.

Off-Peak Shopping: These large retailers see very specific recurring shopping patterns, such as early weekday evenings and Saturday mornings. Through their charging network mobile apps, these retailers could target customers to “stop, shop and charge” during their work commute or other times that are less busy. Using a shopping/charge-time optimization algorithm, they might offer free or discounted charging during non-peak charge times to level reduce peak shopping traffic, but increase the number of monthly visits. Charging apps integrated via APIs with your car’s mobile app might even send time-based offers to you based on your remaining battery range and proximity to specific store locations.

Off-Peak Charging/Parking Lot Utilization: Parking lots are basically a fixed asset and cost for retailers. The lot is a necessary cost of business during hours of operation, but the parking spaces sit mostly unused when the stores are closed. While not core to their business, retailers could open up their parking lots and EV chargers to charging networks and non-customers to drive incremental revenue. These off-peak charging services could be offered in conjunction with neighboring apartments and condominiums, ridesharing services, and other businesses.

Solar Parking Roofs/Battery Storage: With massive parking lots, big-box retailers can install dozens of solar parking canopies that shade cars in hot weather and can help to offset electricity needs for the store and/or EV chargers. Add in battery storage and retailers can take advantage of any excess solar-generated electricity and special off-peak electricity rates.

Food Service/Coffee Bars: Hypermarkets might expand existing food service and coffee bar offerings as a way to keep EV charging customers longer, satisfied, and ultimately spending more time and dollars in their stores.

Warehouse and supermarket chains have the potential to become some of the largest charging centers in many countries. By providing convenient and affordable access to EV chargers, these mega stores can increase their bottom line and solve one of the key challenges to EV adoption.

Image Sources: Costco, ChargePoint











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