Re-Marketable Ideas

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Re-Marketable Ideas

By Matthew Enis - 10/06/2002
I always wanted to be somebody, but I should have been more specific," actress and comedienne Lily Tomlin once said.

For anyone planning a corporate marketing program, that's a great quote to ponder. Businesses, no matter how big or small, are "somebodys." Your company plays a role in customers' lives, but what is that role? What are its values? What is its vision for the future? In what specific ways are those values and that vision communicated to customers?

If a company can't immediately answer one of those questions, its customers certainly can't, either.

A good marketing program helps customers define who a company is and how it is different from its competitors.

Many c-store chains make the mistake of equating marketing with advertising, but a solid TV, radio or billboard ad campaign is only one facet of creating a visible difference at a chain. Wal-Mart didn't earn its reputation as retail's low cost leader by writing jingles, and John Deere didn't build a reputation for quality by selling baseball caps.

"Marketing, in the best sense of the word, is about asking customers what they want and finding ways to profitably give it to them," said Tim Lazor, vice president of the client service group at Pittsburgh-based The Kaiser Group.

"Customers are changing; they have a lot of options, and one of the weakness of the c-store industry is that it isn't always sure what customers want anymore," he continued.

Lazor, whose company has assisted the marketing efforts of industry notables Sheetz and Wawa, lamented that c-store operators are often so focused on operational issues that they neglect to cultivate an image.

"When you get under the hood of the c-store industry, it is a very complex, demanding business that is very operationally oriented," he said. "The industry, in general, has focused on driving costs out of operations — most chains have never been marketing oriented."

The category leaders in virtually every channel of trade each year develop a written, executable marketing plan outlining strategies for each part of their businesses, Lazor said.

This process begins with customer research. "Owners, operators and CEOs, whether through formal or informal research, whether they have 1 store or 1,001 stores, have to ask their customers constantly: What do they want? What will bring them back? What do they like and what do they hate about the store? You have to get at the truth, because the answers will keep changing."

Building from this research requires retailers to focus on several "points of contact" with their customers, Lazor explained. A billboard or a radio spot is one point of contact, but so is the appearance of a store's parking lot and the attitude and appearance of the clerks inside the store. "All of those points of contact have to be good or excellent for people to come back," he said.

Real power, however, comes when chains find a point of contact within the store that they can execute better than their competition. If a competitor down the street is consistently beating the competition by a few pennies on gasoline but lacks quick in-and-out service, for example, promise customers an in-store transaction time of two minutes or less and deliver.

Almost anything, from the selection and value of a c-store's expanded fountain program to the consistent cleanliness of a chain's bathrooms can be highlighted as a point of difference and leveraged to draw customers if marketed properly.

Convenience Store News took a close look at three recent campaigns: Nice N Easy's partnership with major suppliers to rev up excitement in upstate New York; BP plc's new advertising campaign to distinguish the company from competitors in a unique way; and a small beverage company's partnership with a local store to get advice straight from the source — customers.

Cruising Altitude

Many large retail or foodservice chains view sweepstakes and big-ticket giveaways as a win-win situation. Customers get a chance to win money or a prize, while business operators "win" by raising the profile of their company and drawing both repeat business and new customers into their stores.

Yet the intricacies of running a good sweepstakes can intimidate many smaller companies. After all, simply setting aside a pile of cash and handing it to a random customer won't generate the kind of publicity that most chains are looking for.

Generating the word-of-mouth buzz that only rarely accompanies TV, radio and billboard ads, sweepstakes are great marketing tools; however, money and know-how are required to organize the contests.

Despite being new to the sweepstakes business, Canastota, N.Y.-based Nice N Easy Grocery Shoppes Inc. this summer generated significant excitement for customers with its "Nice N Easy Rider" scratch-off game.

The key to successful scratch-off games is a great grand prize, and John MacDougall, president of the chain 75-store chain, drew on his personal insight into the world of motorcycling to choose a truly unique, exciting prize — a 2002 Harley-Davidson V-Rod.

A member of the Harley Owners Group (HOG), MacDougall knew that the V-Rod would have enthusiasts and collectors talking long before a Discovery Channel special on the motorcycle's development was announced.

Designed by Willie G. Davidson, grandson of one of the company's founders, enthusiasts say that the V-Rod heralds a new era of design and direction for the venerable company. The waiting list for new V-Rods now extends through 2004, and original 2002 models are already fetching up to $30,000 on Internet auction sites such as E-bay.

"The V-Rod really is a whole new avenue for Harley, and I think that this is part of the reason that John [MacDougall] was drawn to it for the sweepstakes," said Natelle Ferrucci, projects manager for the chain.

Nice N Easy's supplier partners provided the majority of the funding for the event, explained Ferrucci. Coca-Cola, Snapple and Budweiser, along with 12 other vendors, offered sponsorship monies as well as consolation prizes for the scratch-off tickets.

Since this was the first giveaway of its kind planned by the chain, Ferrucci said she simply took advice from the experts: the company which manufactured the scratch-off tickets and the local radio stations that helped advertise the sweepstakes.

"Our contact at [Huntington, Ind.-based] Triplex Marketing was a wealth of information," said Ferrucci. "To run a sweepstakes like this one, a company is generally required to register with its state gaming commission and obtain a bond. They helped us with all of the New York State rules and regulations — the logistics of the process are a much more complex than you might expect."

In addition, Ferrucci heeded the advice of Regents Broadcasting, which operates four local radio stations. The broadcaster helped Nice N Easy plan the event and the giveaway party, and suggested a six-week time frame for the sweepstakes.

After examining average store customer counts, the company printed 1.5 million scratch-off tickets. Only 500 of those tickets qualified winners for the grand prize drawing, but no one left the stores empty-handed.

"Every ticket was a winner; customers either qualified for the V-Rod drawing or won a product prize from our 15 sponsors," said Ferrucci.

Billboards, radio spots and live radio remotes were used to promote the sweepstakes, which extended from June 24 to August 4, 2002.

"In the middle of July, the game really took off — to the point where some customers were going in a couple of times per day just for the opportunity to get another game piece to see if they could win," said Ferrucci.

On August 17th, almost 300 qualifiers gathered at the Utica-Rome Speedway in Vernon, NY. with hundreds of locals to find out who won. Local resident Patricia Shields took home the V-Rod while other partygoers enjoyed the food, refreshments, live bands and other festivities at the "End of the Ride" event, sponsored by Budweiser.

Although sweepstakes create, strictly speaking, a temporary point of difference from regional competitors, giveaways can have long-lasting impact with consumers as well.

Nice N Easy has most likely won customers for life in Patricia Shields and her family and friends, while events such as the "End of the Ride" party allow c-store executives, managers and sponsors to form face-to-face bonds with their customers in a fun setting.

Easy Being Green

In a recent television commercial a woman poses the question, "What are the oil companies' priorities? Their biggest priority is to make money. There's got to be a balance [with environmental concern] and maybe their balance is a little bit off."

The ad was part of an extensive print and television campaign produced by London-based BP plc, one of the largest oil companies in the world.

The company's "On the Street" campaign, by allowing regular people to vent negative perceptions of big oil, highlights both the growing environmental concerns felt by many U.S. consumers and the cynical views those consumers often have of the energy sector.

Those views, all recorded and filmed on major city sidewalks, range from a young man challenging the oil industry to develop a conscience to an accusation that Big Oil offers payola to auto manufacturers in exchange for a market flooded with less efficient, dirtier cars.

In short, it's a PR nightmare that most oil executives might prefer swept under the rug. BP, however, hopes that by echoing negative consumer sentiment, it can open the door to a positive dialogue and showcase major environmental initiatives already in operation at the company.

"It was very difficult to break through [consumer] skepticism by directly highlighting the significant activities BP was involved in," explained Jennifer Ruys, director of external affairs for BP.

"So, rather than offer up traditional corporate advertising, using beautiful photographs and celebrity spokespeople to talk about all of the important initiatives we were working on, we decided it was important to give voice to the actual sentiments of real consumers — engage consumers in a dialogue, listen to their concerns and views of our industry, and respond with important actions we were undertaking to address their concerns," she said.

Setting itself apart as an environmental leader in the energy sector may ultimately benefit BP's network of branded retailers, jobbers and dealers. According to a recent bipartisan political poll by Greenberg, Quinlan, Rosner Research, 47 percent of registered voters say that the environment is a very important factor in their voting decisions, while and additional 34 percent say it is somewhat important to their decision.

If the issue is that popular at the voting booth, it could emerge as a critical point of difference at the pump as well. Ruys acknowledged that most customers would continue to choose BP based on convenience and value, but noted that the environmental values of a company can be a major decision factor for many as well.

For example, the company's "Green" prototype in Hornchurch, England pushes the envelope of corporate response to environmental concerns. The location's energy requirements are met entirely through renewable sources, including solar panels and three wind turbines. Energy consumption is cut through innovations such as a refrigeration system that directs excess heat into an underfloor heating system. In addition, parking lot runoff is filtered through a reed bed, where bacteria living on the reeds' roots biodegrade any petroleum-based contaminants, cleansing the water before it enters local streams.

Although it may be quite some time before BP Connect stores in the U.S. begin to resemble the green prototype, major initiatives already in place include BP's recent voluntarily roll-out of low-sulfur fuels in 40 U.S. cities six years prior to EPA deadlines.

And while even attentive customers may not spot them, canopies capped with solar panels already supply 15 to 20 percent of the energy needs at corporate BP Connect locations. In addition to on-site conservation, the canopies highlight BP's role as the world's largest producer of photovoltaic (solar panel) systems.

At press time Ruys said that it was "too soon to fairly evaluate the overall impact of the campaign;" however, feedback to BP's website has generally been positive. One self-described environmentalist wrote in to say that he or she "welcomed the opportunity to have . . . past assumptions proven wrong and to see BP in a new light."

The campaign has the potential to strike a powerful chord with consumers, especially since its message coheres so well with the companies recent reimaging, rebranding and remodeling efforts.

"While consumers . . . have seen the positive changes due to the reimaging and rebranding of many BP and Amoco facilities to the new BP retail brand, this is truly the first time they will be exposed to the company and its important values and initiatives beyond purchasing fuel or other convenience items," said Ruys.

Serving Suggestion

Put free food out for your customers once, and they'll keep coming back for more.

Scanning the aisles of the local supermarket on any given weekend, customers are likely to find a few free samples of something or other. Whether it's the deli showcasing its selection of quality cheeses or a regional vendor offering taste tests of the next great cola, samplings draw attention, generate sales and present a rare opportunity for retailers and vendors to engage customers in a dialogue about their offering.

"It builds goodwill [between the retailer and customers] and adds theater to the shopping experience," said Richard Turcsik, senior editor of Progressive Grocer magazine, noting that warehouse clubs developed extensive sampling as a key point of difference with other channels as well.

Yet most convenience store retailers rarely host product samplings, generally citing concerns over space, labor and waste. Also, some locations may simply not have the traffic flow needed to make a sampling worthwhile, noted Turcsik.

These issues aside, product sampling could be an excellent experiment for many retailers, if only to have the opportunity to take the advice of Tim Lazor from The Kaiser Group and ask customers what they want and what will bring them back to a store.

A Hebron, Ind.-based Flying J Travel Plaza recently allowed Quick Energy Formulas of America, based in nearby Hobart, to host a product sampling of its Q-Blast drink, mutually benefiting both companies.

"Obviously, you have to have a good product — if it's not good, it's not going to go anywhere, but there are a lot of other components that are needed for success," said Leon Woleck, president and founder of the beverage company.

Woleck is right; muscling into a convenience store's overcrowded cooler definitely requires more than quality. To make matters more difficult, his product, a low-sugar sports drink, competes in a segment already defined and dominated by Gatorade and Powerade, properties of the two largest beverage companies in the world.

To overcome those hurdles, Woleck had to work extra hard to convince both retailers and their customers to try his product.

"Anytime that you have a sampling, or place a product in a cooler near the register, it dramatically increases the chances of customer purchase," said Tim Riese, assistant general manager of the Flying J location where the sampling was held.

Of course, many retailers are reluctant to give prime selling space to untried brands, so after Riese agreed to carry Q-Blast at his location, he encouraged Woleck to try hosting a sampling.

"Retailers have told me that our product samplings really energize the environment," said Woleck. "When customers come in, it's not just a few bottles sitting there, it's banners and balloons and people who are actually smiling and thanking them for trying the product."

"The truckers like to talk, there's no doubt," agreed Riese. "Given that they're on the road for so long by themselves, when they make a stop, they really enjoy events like these."

Impressed with the brand and its presentation, a few customers bought bottles by the dozen, Woleck said. Riese agreed that the Saturday afternoon sampling had been a success, noting that the location sold about 13 cases during the five-hour event.

"It went really well," Riese said, "I would absolutely try this again with other products. It gives customers a chance to try new items and ask questions." Vendors also have a chance to explain what a new product has to offer, he explained.

Hosting samplings from suppliers, whether large or small, offers the opportunity to differentiate a location from local competitors for a day while interacting with a store's customers on a new level.

Also, any store or chain offering a new foodservice item or making a coffee program upgrade should take the lead from local supermarkets and consider sampling events a must.

Although non-sponsored samplings may end up costing slightly than a store immediately makes up in sales, they offer a rare opportunity to receive immediate customer feedback.

Woleck noted that such feedback even helped him tweak the coloring of his product during its early stages. And customers notice when you take their advice, he said.

"When you get out there and interact with people, they're going to pick up on whether you're real or not. If you truly listen to consumers, and cultivate their input into your corporate thought process, people notice," said Woleck.