Maverik's Big Adventure

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Maverik's Big Adventure

Cascading waterfalls. Off-roading through the desert. Kayakers navigating rambling rapids. These are hardly the images that come to mind when a customer walks into a convenience store, but if Maverik Inc. has its way, they'll be some of the thoughts in the minds of customers when they leave the store.

The 180-store chain based in North Salt Lake City, Utah, has spent the last three years overhauling its stores and building on an "adventure" motif, spearheaded by vice president of marketing Brad Call. It starts with the chain's slogan — "Adventure's First Stop" — and works its way into every detail of store operations.

"Before we embark on a new project," said Call, "we put it through our 'adventure lens' — everything for public consumption must go through that lens. We're looking to provide our customers with a unique experience, and we follow through with that theme in our POS, point-of-purchase materials and advertising.

"As I look at the convenience industry, it's an industry of generics…what we try to do is make it unique, make it fun for people."

To that end, Maverik is changing its image from that of an Old West general store to a more dynamic, active shopping destination. New stores are larger (measuring from 3,500 to 4,800 square feet) and feature high-profile destination areas with unique names, including "Room With a Brew" walk-in beer coolers; "Bodacious Bean" coffee station; "Alpine Rush" frozen yogurt dispensers (a big hit with Maverik customers); "Big Bear Bakery"; "Fountain Falls"; and one of Brad Call's favorites, the "Big Moon" restrooms. All of these sections of the store are highlighted by colorful 3-D murals of outdoor activities.

President and CEO Mike Call (Brad's cousin — both men are grandsons of Maverik founder Reuel T. Call) has been thrilled with the success of the "adventure" campaign. "I credit Brad with the whole adventure theme," he said. "He's done a super job helping us reshape our image. We really wanted to revamp everything, so we created a new look for the store and created these new naming elements for areas of the store."

For Maverik, according to Mike Call, it's really been an attempt to try to reposition the brand as targeting the demographic that is generally appropriate for the c-store sector — a little bit younger, more high energy.

"We really like the 'adventure's first stop' concept," he said. "It gives us that adventure theme. We feel that was it is equally important for the rural stores that we have as well as our urban, metro stores. Everybody's got an adventure — we may not hit every one of them, but we came up with a number of adventures that probably touch everyone's life every day. So we invented this idea of Maverik as the place to get suited up for the adventure of the day, whether it's a trip to the Red Rock, or a trip to the soccer field with the kids."

Join the Club

One of the most successful elements of Maverik's campaign is its two-year-old Adventure Club Card program that rewards loyal customers for gasoline purchases. "We currently have 450,000 active members, and a majority of gasoline purchases are done on the card," said Brad Call. "We offer monthly specials to card holders, in addition to instant rewards of 2 cents off per gallon of unleaded or diesel; 3 cents off mid-grades; and 4 cents off premium."

There are also quarterly rewards for different levels of participation:

Action Level, with a quarterly purchase of 275 gallons = $5 worth of free gas;

Expert Level, 525 gallons = $10 worth of free gas;

Extreme Level, 750 gallons = $15 worth of free gas.

"We have gotten a lot of mileage out of the Adventure Club," Mike Call said, "and that's one of those little things that helps people decide between us and a competitor. More often than in the past, they're deciding to come to us."

For one thing, Maverik makes signing up easy. "We heard a lot of reluctance in the beginning, and while we were signing up tons and tons of customers, we also heard a lot of people say, I'm not going to carry a card; I'm not going to put anything in my wallet; I'm not going to tell you who I am. And our program is kind of nice in that the customers are able to choose from two different levels.

"One level is 'I don't want you to know who I am; I don't want you tracking me. But I want the instant discount.' So we have it structured so that they can do that. They can be part of the program. If they don't tell us who they are, obviously they can't get the cumulative rewards but they can get that instant discount.

"And then you have the other group, which is the vast majority. The group that says, 'yeah, I'm okay with that,' and they sign up and hope that they can get the larger type of rewards. That flexibility may be part of the reason the program is so successful."

Come On In

Although Maverik's history is as a refiner, and gasoline continues to be a big part of its business, the real focus now is on the in-store offering — and foodservice is one of the keys to attracting more customers inside.

The chain has expanded its offering, with the emphasis on fresh, quality foods. Each store operates its own bakery for fresh breads, muffins and pastries, as well as a clean, well-stocked condiment bar for customers to build their own sandwiches. Many of the stores also feature Krispy Kreme doughnuts.

"One of our goals is to attract the female customer," said director of foodservice Curtis Watson. "So we're offering more fresh foods and salads. Our frozen yogurt program is a cornerstone of what we do."

Coffee is also big business. "We've improved the coffee area, and are offering more syrups and flavored creamers," Watson said. "There's more cappuccino heads and an overall cleaner, crisper look. We've taken the coffee program completely in-house. When we look at cost savings and sales increases, we're up 20 percent since taking it over in May."

He added, "We're looking at how our staff can get a better cup of coffee to our customers."

Looking forward, Watson said, "We're exploring some other trends…authentic foods for the Hispanic market, more healthy food offerings, more proprietary products — not just in foodservice, but at the fountain and dispensed beverages area also."

Inside the store, foodservice (including fountain and coffee) ranks second in sales for Maverik, but its importance is No. 1. "Our foodservice offering is really strong and showing great growth and continues to contribute to our average store sales increases," said Roger Green, vice president, store operations.

As for the top in-store categories, Maverik would appear to be in line with the rest of the industry — cigarettes, beer and packaged beverages (both carb and non-carb) are its biggest sellers, but as Tim Taylor, executive director merchandising, noted, "We have not historically been as reliant on tobacco and alcohol as other c-store companies. We decided to grow other categories, and foodservice has become our emphasis.

"While tobacco and beer are the two top categories, their percentage of total sales is less than that of the industry average."

Speaking of beer, the walk-in coolers have been big business for Maverik. "They've been very successful," said Taylor. "When we bought some Circle K stores six years ago, we redesigned and reopened all of them with beer caves. It started off slowly, but now customers have embraced it."

The stores still stack beer cases inside and throughout the store. "Large, warm package displays send the message out that this is the place to get beer," Taylor said. "The beer in the cave is colder than the traditional cooler. We can keep the cave colder because it's a separate vault."

Other categories that have been performing strongly, according to Taylor, are general merchandise and novelties, snacks (particularly healthy snacks and energy bars), candy and frozen novelties.

"The frozen novelties are, naturally, highly seasonal," said Taylor. "The challenge is being ready for that season and taking advantage of it. For instance, we do a Blue Bunny four-for-$1 ice cream sandwich promotion to kick off the season."

Promotions are, in fact, a big part of the Maverik in-store strategy. "We've heavily promoted non-carb beverages — energy drinks, isotonics, water, and juice, which have even outperformed carbs some months. "

Taylor added: "One of the things we do differently is tie in one in-store product with the Adventure Club card. We see huge sales spikes on those categories. Card users see value at the pump and in the store.

"We want to be seen as the value leader in the marketplace — price, product, mix, etc."

Keeping Stock

As is the case with any convenience chain, new products present a challenge to Maverik. "It's a challenge for any company," said Taylor, "working to figure out what will have staying power. Some of our stores, for instance, have a test area in the cooler to 'trial' new products. With new products you have to rely on information you get from manufacturers and other channel data."

Maverik employs Spaceman space management software, which helps the company determine profit and sales to space. "We work hard to have a uniform offering across all stores," Taylor said. "In our smaller stores, we offer a scaled-down version of the same selection. We determine planograms based on performance to space and customer expectations."

As for keeping in stock, Maverik has inventory controls in place. "We scan in all our stores," said Taylor, "and we have electronic computer-assisted ordering that looks at the last 12 weeks of sales and factors in when you will receive your next order and the minimum number you want to have in stock, then suggests to you what you will need to order to meet sales demand."

According to Taylor, nearly all inventory ordering is done at store level, with weekly deliveries — although, depending on volume, some stores are getting deliveries twice weekly, which helps to prevent out-of-stocks. The chain's primary wholesaler is South San Francisco-based Core-Mark Inc.

People First

In order for Maverik to carry out its mission the right people need to be in place. At Maverik, store-level employees are called "adventure guides," and their responsibility is to convey that sense of excitement and energy to customers.

"We have really tried to focus a lot of effort on creating this adventure concept not just through the physical facilities — they're kind of secondary in importance really," said Mike Call. "We think that the environment created in the store by the people who work there is the No. 1 determining factor in whether customers are going to come back."

Call continued: "We have really worked hard to try to come up with programs that will allow us to identify those people who have our set of values — adventure guides who bring energy and excitement to the store and who love taking care of people. The priority for us is to create this adventure guide culture throughout the organization from top to bottom, and have customers identify that as a reason for why they select Maverik.

"One of the things we try to reinforce with people is that we're not the only game in town and this isn't the only thing to do. If you like a high-energy, fast-paced environment and interacting with people, you'll do well here. Some people are surprised to hear me say to them in meetings, 'If this isn't what you're all about, go find something that is because you'll be much happier and we'll succeed more, too.'"

Forward March

The emphasis on people and on the store as "Adventure's First Stop" seems to be paying off for the company, which is enjoying the fruits of the campaign and looking to grow in the near future. "The new stores are really doing well," said Brad Call. "We're not patting ourselves on the back though. We're just trying to keep moving the ball ahead of the other guy."

Growth is definitely on the agenda for Maverik. "In terms of the future of the company, we have taken on a more aggressive growth position," said Mike Call. "I won't say that we are extremely aggressive but prior to this team being in place, growth was rather slow with limited opportunities and we feel we put together a better offer that has the ability to appeal to more people, which gives us the chance to grow considerably more."

The goal of the whole "Adventure's First Stop" campaign is to create a recognizable brand identity for the chain through on-site promotions, billboards, and extensive radio and TV advertising — and so far, it seems to be working. "Branding is so important," said Call. "It's easy to give lip service to that, it's easy to talk about what a brand is, but the true measure is from a customer's perspective. If you can ask a customer and they can identify what it is you're trying to get done, then you make a difference."

Maverik has come a long way in marketing itself as a destination for customers looking for something more than the ordinary convenience store, and as the chain continues to grow so will its reputation for being the place to go for a quick lunch on the go, a six-pack of ice-cold beer, or a cup of cappuccino — and maybe a little adventure along the way.

"I'm very optimistic about the future," said Call. "We've been through many, many challenges. Three years ago it was pretty rough. When it looked like everyone else wanted to get into this segment, we wondered how we could compete, what's the model for making a success out of this. Those were difficult times, but we've been able to make it through those, and I'm certain there will be more challenges in the future. And we'll be in a better position to address that."