As the convenience store industry has become more sophisticated, other retail channels are turning to us for leadership and guidance.
By Howard Stoeckel, Vice Chairman, Wawa Inc.
This year marked Convenience Store Decision’s 25th anniversary and Wawa’s 50th anniversary in the retail business. In recognition of our milestone anniversary, I had the opportunity to publish a book “The Wawa Way,” which I’ll share more about later in this column.
When I reflect on the past 25-50 years, the first thing that comes to mind is how quickly time flies. Where did it go? That’s actually good news for our industry. Our customers continue to be busy, time starved and looking for daily solutions. Years ago, the convenience store industry was the primary provider of convenience.
Today, everyone in retail wants to be convenient. Drug stores and dollar stores think of themselves as convenience retailers. Quick-service restaurants (QSRs) have expanded hours, and big box retailers are beginning to think smaller.
All of this means more competition for our industry. But we have demonstrated that competition makes us even better. As an industry, we have risen to the occasion and we now compete with well-run, national QSRs, drug store chains and emerging dollar stores. The industry has become much more sophisticated and others are learning from us. Competition has taken us to new levels.
The second thing that comes to mind is our talent base. The quality of people entering our industry is getting better and better. We have become a much more attractive employer. With better looking stores, with stronger brand identities and with stronger industry leadership, we are attracting people to the industry we only dreamed about decades ago. Our people continue to set new standards for the industry and take us to distant places.
The third thing that comes to mind is the velocity of technological change. Think back 25 years… We are a very different business today. Fuel technology, ordering systems, loyalty programs and social media marketing…just to name a few. Imagine what the next 25 years could be like.
The industry is well positioned for the future, and I truly believe the best is yet to come. The industry remains entrepreneurial, nimble, and highly customer/service focused. It has a special relationship with customers and communities.
I would now like to overview some of the changes at Wawa with the assistance of my co-author of “The Wawa Way,” Bob Andelman.
Building a Brand
When Wawa started in the convenience store business in 1964, we were the alternative to a supermarket that was then operating on limited hours and not open on Sundays. People would stop on their way home, grab deli, produce, or a dairy item, and go home to enjoy it with friends or family. Over a period of time, however, we evolved into a restaurant-to-go for breakfast, lunch and dinner, the in-between snack occasion, or an afternoon pick-me-up.
Today, our biggest competitors aren’t supermarkets or even 7-Eleven; they’re McDonald’s, Dunkin’ Donuts and ExxonMobil.
In the 1990s, our then CEO and current Chairman Dick Wood, challenged us to take the company to the next level. He inspired us to see things differently and to think bigger, including bigger stores. At that point, it wasn’t obvious that bigger was better. Smaller locations were easier to open and meant lower costs. But looking at the economics and our strengths, we found that big was better, at least for Wawa.
In 1994, we opened our first really big store in Tinicum, Pa., near the Philadelphia International Airport. It was 5,600 square feet and had fifty parking places—huge for our industry at the time. We decided that size gave us presence, room for lots of customers and parking, room for equipment and storage, and room to change and grow. Every store we’ve built since has been a superstore.
When we opened our first modern gas store in August 1996, in Millsboro, Del., we bet the farm that gasoline was going to be an important new strategic weapon for Wawa.
We became a ‘New Age’ gas retailer in that we had big, well-lit, clean convenient sites, and we priced our product reasonably. We invested in technology called the Veeder-Root system that allows us to monitor our underground tanks and piping to ensure that we were not leaking fuel and degrading the environment, as well as maintaining real-time inventory measures and adding the capability to order additional fuel deliveries automatically. The system feeds data to our distributors who can monitor our fuel levels to ensure timely deliveries and prevent our stores from running dry.
The move into gas was a big gamble. We found ourselves wondering, If we build it, will they come? They did—with cars, boats, mobile homes. The lines circled the store, and we had arrived in the fuel business.
Because we’re so unique, we intentionally resist labeling ourselves. Many people simply give up on describing us to their friends and just say, “You just have to go there. You’ll see.” Actually, they are almost correct. When a customer visits a Wawa, it’s what they see, feel, taste, smell, and hear that defines our offering. It’s not any single sandwich or beverage or gas price. We have always focused on the total experience.
Food for Thought
Stephen Hoch, a marketing professor at the Wharton business school, says that when you think about it, Wawa might not even be a convenience store in the traditional sense anymore—the place you’d go as a last resort for a can of soup. That role has been assumed by drugstores like CVS, Walgreens, or the dollar stores. Really, Hoch said, “Wawa has become a fast-food restaurant with a gas station.”
The equation isn’t as simple as it might sound. We have had food inspectors in Florida who said, “I can’t inspect this store because I’m a convenience store inspector. We need a restaurant inspector to come in here.”
I always knew that if we were going to run with the big dogs, we had to be a big dog—but we didn’t have to be on the leading edge to thrive. In fact, we’re rarely the first to introduce a new product, process, or marketing concept. Sheetz had the touchscreen-ordering system first. McDonald’s did a great job of invention with the Egg McMuffin, but we mainstreamed the Wawa breakfast sandwich with the Sizzli in 1996. Our success has been in adapting popular concepts, then making them available quickly and easily to our customers.
Keys to Consistency
Another one of our keys to success against competitors is our consistency. When we entered the convenience industry, 7-Eleven was already a national chain, but we found an advantage by making all our stores company-owned and company-operated. Other convenience store chains, on the other hand, use a franchise model. That means they’re not nearly as consistent as we are and have a much different corporate culture; and their corporate business has always been about selling franchises first, convenience second.
Our business is about running each and every store on our own and maintaining consistency throughout the chain. Essentially, we’ve become successful by both expanding our perspective and narrowing our playing field. We strive to be the best in the world at frequent, immediate, quick and easy products. Before we realized that, we probably attempted to appeal to too many people and do too many things.
Choosing our opportunities, staying true to who we are, staying true to the needs of our customers, and building the infrastructure—those are the things that help us run with the big dogs.
