The Final Phase

The April 2008 cover story of Convenience Store News focused on a new three-year plan by CHS to transform its Cenex brand into a state-of-the-art petroleum and convenience retailing banner that could rival any competitor. The strategy called for a comprehensive image makeover for its network of retail locations; new radio and television advertising to improve brand perception; and continued expansion into major metropolitan areas. With just months left in its original timeline, CSNews recently checked in with CHS to see whether the company's plan is on target.

Although it has been difficult keeping to such an aggressive timeline, Doug Dorfman, manager of marketing and retail development for the CHS refined fuels division, happily reported the St. Paul, Minn.-based company will achieve its goal of having all locations sport the new Cenex image by the time its fiscal year ends in August.

"Getting the process going [with] the amount of work that had to be done, it was slow going that first year, especially since we hadn't done something like this in awhile," Dorfman told CSNews. "But since then, we have gotten ahead of the curve."

As of press time, more than 85 percent of the Cenex retail network had been reimaged. There are roughly 1,500 Cenex-branded retail locations in the United States, about 1,000 of which include a convenience store. CHS owns and operates 70 of the locations.

The new Cenex image, which debuted September 2007, consists of a redesigned canopy, brighter paint scheme, new lighting and digital signage. Dorfman said the response to the LED signage has been better than expected, with 75 percent to 80 percent of all the sites opting to go with the LED signage as part of their forecourt makeover.

"Generation Image Renewal" -- the name CHS gave to the new imaging campaign -- was aimed at staying true to the company's farming roots, while bringing the widely recognized red Cenex butterfly into modern-day petroleum retailing, and responding to consumers' desire for clean, bright, inviting, well-lit and modern facilities.

Once complete this summer, Dorfman said the marketplace will see CHS continue to provide a first-class image for its operators and a more inviting environment for its customers. "And in terms of brand support, having all your locations [share] a consistent image is so much better for the brand," he added.

Even though the reimaging is coming to an end, the company's Cenex Guy advertising campaign, which was slated to run through 2009, is continuing on indefinitely.

The campaign was originally launched in October 2006 as a way to make general consumers aware of the breadth of Cenex products, and reinforce the purchase decisions of existing customers. Being an umbrella campaign, it allowed the Cenex brand's separate product divisions propane, lubricants and refined fuels (includes c-stores) to do individual product advertising, but tied it all under one theme.

"The Cenex Guy is living on, and the campaign will continue to evolve," Dorfman said. "We will continue to use the Cenex Guy for brand awareness and to deliver product-specific messages."

Thanks to both the reimaging and the Cenex Guy campaign, consumers' perception of the Cenex brand is very different today than before these efforts. "It's viewed as a more modern brand now," he noted. "It's no longer just confined to rural America; people are seeing it in metro areas. We're now in every market big and small."

In the company's most recent survey comparing the Cenex brand to other oil banners, CHS saw improvement particularly in "un-aided awareness," where respondents were asked to write in the brands they were aware of, and purchased in the last 30 days.

"We did see an uptick in the number of people who said they purchased the Cenex brand or were aware of it," Dorfman said. He also believes the new brand image is generating increased traffic and sales for Cenex-branded locations. While industry fuel volumes were down between 3 percent and 5 percent on average last year, fuel volume at Cenex-branded retailers grew 3 percent.

What's Next?
Unlike some of its Big Oil competitors that are pulling out of markets or selling off retail sites entirely, CHS intends to continue growing its network. The company added 135 sites in 2008, and 60 in 2009.

Given the uncertainty in the economy, Dorfman said everything was on hold last year as most dealers wanted to stay with what they had, but the company is starting to see more movement now as the economy picks up.

"Now that our image has changed, some of our current jobbers who had the brand in rural markets and a competitor's brand in metro markets, switched to our brand," he said. "We hope to see more of that."
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