Customer Fanatics

Maverik has an entire organizational structure dedicated to putting consumers first

There’s only one boss at Maverik Inc. and it’s not the CEO. It’s the customer.

“Oftentimes in this industry, decisions are category driven or vendor driven, but [in doing so], we may not be giving our customers the best experience. Customers are the ones who drive our success,” said Ernie Harker, executive director of Create, Maverik’s marketing department. “We never lose sight of our highest priority: the customer. We don’t get lost in the business of the business.”

While some companies say they put customers first, but then do little to act on this promise, Maverik has created an entire organizational structure to ensure every decision impacting its roughly 250 convenience stores is made from the perspective of thrilling shoppers — and not just its core customers, but every type of consumer who walks through its doors.

Instead of a traditional merchandising department, the Salt Lake City-based retailer employs what it calls “customer segment teams.” Launched two years ago, each team is comprised of a segment director who is responsible for bringing programs that deliver financial targets; a segment manager who acts as the voice of the customer and identifies their needs; a segment value manager who pinpoints products, services and promotions to deliver against those needs; and a procurement manager who handles the day-to-day vendor activities.

Three teams are organized around seven customer segments that Maverik identified (with the help of an outside consultant) as key to its business. One team oversees Blue Collar Workers and Hispanics. A second team focuses on Emerging Adults and Adventurers, while the third team concentrates on Women with Children, White Collar and Healthy Lifestyle.

In addition to “owning” its customer segments, each team is responsible for those product categories that over-index with its consumer types. The Blue Collar Workers and Hispanics team, for example, handles tobacco, beer, wine, liquor, lottery, gaming and gift cards. The Emerging Adults and Adventurers team oversees foodservice, snacks, fountain beverages, hot beverages and specialty cold, including f’real, its Chiller frozen beverages and frozen yogurt. Finally, the Women with Children, White Collar and Healthy Lifestyle team manages candy, packaged beverages, health and beauty aids, grocery, novelty apparel and electronics.

“It is a brand-new model that’s never been done before,” explained Harker, who works with the teams to reach, on an emotional level, the customers who are the focal point for that product without offending the segments that are not the target demographic.

Rather than put products in the stores and hope customers come, the goal of the customer segments teams is to seek out what each group wants, needs and desires and then tailor solutions to that. “If we can meet those needs better than anyone else and give them a unique experience, that is what’s going to make someone drive the extra mile to come to our store,” said Aaron Simpson, director of the Women with Children, White Collar and Healthy Lifestyle team and Maverik’s first-ever hire within this new structure. “The other thing is that we can never forget our core Blue Collar and Emerging Adults, but there is an opportunity to expand our customer base. Since we have the blue-collar male, why not get his wife into the store, too.”

THE SEGMENTS

Each customer segment has unique characteristics and shops Maverik stores differently. Basket size, the times of day they come into the stores and the product mix they buy all vary.

Blue Collar

Traditionally the core consumer for c-stores, this is Maverik’s largest customer base.

Hispanics

Hispanic customers are unique in that Maverik views them as Hispanics, but they also connect with the other segments such as Women with Children and Emerging Adults. Currently, Hispanics are the retailer’s third-largest customer segment behind Blue Collar and Emerging Adults.

“Everyone has the Hispanic shopper front of mind. We are strong in this area, but we’re looking to grow,” said Danielle Mattiussi, director of the Blue Collar and Hispanics team. “We do well in attracting Hispanics, but we have some market areas such as Boise where there’s a heavy Hispanic population and we could be doing even better.”

Emerging Adults

While most retailers would classify these consumers as Millennials, Maverik considers them customers who are in transition. According to Joey Hobson, director of the Emerging Adults and Adventurers team, it’s more about what these shoppers are not vs. what they are.

Generally between the ages of 15 and 29, emerging adults are not married; don’t own their own home; are not at a stage where they have a rhythm or routine; nor are they settled professionally. Once they become settled, these consumers will effectively take themselves out of the Emerging Adults demographic and become part of another segment such as Blue Collar or White Collar.

Adventurers

Adventurers are anyone who likes to go out and have an adventure. Maverik’s research shows that 62 percent of the individuals who come into its stores — which are adventure-themed and branded as “Adventure’s First Stop” — consider themselves to be adventurers.

“People really like to think they’re adventurous,” Hobson said. “It could be mountain biking, water skiing, rock climbing. For others, it could be an adventure taking their kids to school.”

Because this segment overarches many of the other customer segments, Maverik doesn’t do a whole lot with Adventurers except to make sure its adventure brand is always reinforced.

Women With Children

This segment is somewhat c-store skeptical, but those who do shop at Maverik spend a lot of money with the c-store chain. In fact, Women with Children has the largest basket size.

White Collar

White Collar customers don’t frequent the stores as often, but when they do, they also have a large basket size. Like Women with Children, these shoppers are also c-store skeptical.

Healthy Lifestyle

People have the perception that they can’t get healthy food at a c-store, so creating awareness is paramount in trying to attract Healthy Lifestyle customers. “Our challenge is getting them to come in and experience our store,” said Simpson.

THE STRATEGY

Because consumers are so diverse, Mattiussi said it is rare for a customer to fit in just one bucket, so the teams’ challenge is to explain what the data shows across the segments. “There’s a lot of collaboration between the teams and we’re getting better every day,” she added.

To determine the wants, needs and desires of each customer segment — and then select the right products, placement, price and promotions to fulfill those — data and research are integral.

As the inaugural member of the customer segment teams, Simpson said the first thing he did upon joining Maverik in July 2011 was to conduct an Attitudes and Usage Study, which captures customer perceptions across various aspects of Maverik’s stores.

Since then, this study has become a quarterly occurrence, with a more in-depth version conducted annually.

Maverik also regularly does customer focus groups. When the retailer rebranded its frozen beverages from ICEE to Chiller last year, it brought in customers to gain their feedback.

At the store level, Maverik has a customer advocate team in the field that makes sure the chain is meeting the needs of its customers and the communities it serves. Each advocate works with a district supervisor and is responsible for a specific geographic area.

“The advocates are out there to talk to the customers,” Simpson explained, noting that a lot of information also comes from Maverik’s store employees, who are known as Adventure Guides.

Each time a transaction is completed, the guides are tasked with pushing one of seven buttons on the point-of-sale to classify what segment that customer most falls into. In doing so, Maverik can then analyze transaction data to determine whether its efforts are hitting the right targets.

“This data also allows us to understand what demographic we’re getting in each of our stores and then really tailor the needs to each of the stores rather than blanket them,” Simpson said.

Hobson acknowledged, though, that “it’s not a science; it’s more of an art form.”

With data being so critical, the customer segment teams are very excited about the recent launch of Maverik’s new loyalty program — version 2.0 of its Adventure Club Card program — through which the teams will be able to get even richer customer data.

“We have a very complex, robust rewards program that we just launched,” Harker said. “The old program wasn’t as engaging as it could be. I could earn points for purchases and those points were converted into gift cards, and then I could use those cards to purchase gas or in-store items. We knew we needed a new rewards program that would engage every customer profile.”

With the help of the customer segment teams, Maverik spent a great deal of time considering what type of loyalty program features would resonate with each customer segment. This information was then used to develop a program that addresses most of those desires.

For instance, customers want to know where they stand on the path to rewards. But research showed Blue Collar and Hispanics have a lower usage of smartphones. “So, we had to create a way [to enable this] that was low to no technology. We have White Collar and Emerging Adults, though, who love technology. So, we decided to communicate it on our receipts,” Harker explained. The tech-savvy segments can access the information via Maverik’s newly enhanced mobile application.

Through this new loyalty program, Maverik intends to target its promotions and contests to the different customer segments. Sweepstakes, for one, will include a more diverse set of prizes.

THE SUCCESS STORIES

While there are still some wrinkles to iron out, this new trail that Maverik is blazing is having a positive impact in several ways. For Mattiussi of the Blue Collar and Hispanics team, the customer intelligence is the biggest benefit, particularly in regards to vendor relations.

“A vendor comes in and shows us data supporting that they want to pull a certain pack size from our stores and replace it with a different pack size. In preparation for this meeting, we can pull our own customer intelligence to see if our data supports such a change. We can make sure we’re always advocating for the customer instead of vendors dictating the direction,” she said. “The successes are more subtle, but they’re cumulative — and it ends up with happier customers.”

For Simpson of the Women with Children, White Collar and Healthy Lifestyle team, he said the biggest advantage of this approach is the way in which all three teams work together. Even though his team “owns” the packaged beverages category, each time he does a cooler reset, his team’s segment manager will reach out to the segment managers on Mattiussi’s and Hobson’s teams to gain insight into their customers and the beverages resonating with them.

“It’s very interactive,” Simpson said. “Last year, when we reset the cooler, we added a second shelf of Hispanic beverages in our top Hispanic stores based on the feedback of Danielle’s team.”

By truly putting the customer first, Harker said Maverik is less at risk of becoming irrelevant. Vendors may still give the retailer the data that best reflect their own interests, but now the customer segment teams know what products Maverik’s customers really do want, in what quantities they want it, at what price they are willing to pay for it, etc. The power has shifted.

While it’s still a little too early to determine the return on investment from this new organizational structure, Harker believes Maverik is “definitely on the right track. We’re doing programs that are engaging these customer groups that we wouldn’t be doing otherwise.”