As Chevron Corp.'s ExtraMile concept has evolved, it has kept one element steady: its commitment to the heavy c-store user, or someone who comes into the store an average of 20 times a month, up to three times per day.
“The starting point for everything around the offer is proven demand already for a particular product or concept,” says Paul Casadont, merchandising manager for the Americas. “Is it something that the customer wants?”
The ExtraMile merchandising team relies on syndicated c-store sales data from Nielsen, supplier insights and its own scanning data from 550 COCO and franchised locations to help guide its decision making.
Chevron also conducts its own consumer research. One recent shift it noted in attitudes: Before, when the heavy c-store users were asked for the most important quality of their c-store trip, they showed a bias toward saving time vs. paying less. In the past year’s study, both factors ran even.
“The biggest change seen around the consumer is around the value equation,” says Casadont. To meet this need for value, ExtraMile offers everyday competitive pricing on all products—energy drinks, foodservice and candy feature “two-for” pricing. Bi-monthly promotional activity and POP/media support for other high-demand products are aimed to consistently message value to the consumer.
The ExtraMile team is hoping to deliver this by honing the store to meet local customer needs. What follows are highlights of those efforts.
Foodservice
ExtraMile’s Extra Good To Go program offers a range of hot food—sausage and brats, corn dogs, taquitos, nachos and tamales—as well as fresh sandwiches, salads and fruit, and heat-and-eat offers. It has added products new to the chain, including AdvancePierre’s Big AZ cheeseburgers, and has a few fresh sandwiches on the launching pad that are more targeted toward specific day-parts. “It’s less one size fits all, and more targeted to specific shopping patterns in each location,” says Casadont.
The issue of food waste is also an area of “heavy focus” this year, guiding the foodservice program’s evolution to one that is optimized per site.
For example, ExtraMile educates franchisees on the life cycle of a food item from order to preparation. Then it helps them sync the food offer to the appropriate day-part. For example, two ExtraMile sites sit directly across the street from one another. One sees more traffic from commuters on their way to work in the morning, and the other sees more commuters on their way home.
“In the past those stores, regardless of whether COCO or franchised, would have very similar types of food offers,” says Casadont. “What we’ve done in the latest update with Extra Good To Go is look at the scan data for stores and get a true reading on whether it’s a morning, midday or afternoon store, or heavy weekday vs. weekend store.”
Based on the findings, the offer shifts to place greater emphasis on breakfast items if it’s a morning store, or hot dogs, taquitos and fresh sandwiches if it is an afternoon store.
The stores are also changing their approach to foodservice promotions. In the past, they highlighted and promoted different offers every two months, which caused some confusion among customers and more work for operators. Starting in the first half of 2014, ExtraMile has made the same consistent offers to help build customer expectations for the brand.
CONTINUED: Fountain
Fountain
One of ExtraMile’s biggest challenges is the fact that its store footprints—whether franchisee-operated or COCO—vary greatly, ranging from 500 to 2,000 square feet of selling space. In the smaller stores, it can be very difficult to have a huge fountain and frozen presentation that matches that of the competition.
“Right now our focus is on having a consistent, competitive fountain and frozen offer, but it hasn’t been a destination category for us—it’s been more of a complementary type of purchase for the consumer,” says Casadont. While the offer is competitive from the standpoint of pricing, cup size and variety, there is room for more customization.
Chevron is looking at new fountain technology that would enable it to differentiate its offer. While Casadont declined to specify which particular technological step ExtraMile might take, it would be in line with The Coca-Cola Co.’s Freestyle machine, which allows users to mix custom Coca-Cola beverages.
Coffee
Two years since the rollout of its Seattle’s Best Coffee (SBC) branded offer, the ExtraMile team is happy with the results. It has added new varieties such as an extra-dark roast and fair-trade blend, and expanded into iced coffee.
While he declined to share specific coffee sales figures, Casadont says sales of ExtraMile drip coffee are outperforming the market. The team now believes the SBC program has even greater opportunity beyond drip coffee.
“Drip coffee is not growing at a very quick rate at all,” says Casadont, citing the real growth is in specialty coffees such as lattes and mochas. The ExtraMile team is evaluating how it can expand into these beverages through single-cup technology, which helps it avoid dedicating significant labor to the new coffee offer.
CONTINUED: Tobacco
Tobacco
The ExtraMile merchandising team is completing a reset of the tobacco backbar, moving in e-cigarettes. It is also testing vaping products at 10 sites.
“We know there’s demand,” Casadont says. “We just want to make sure from a safety perspective that we’re working with the right suppliers around vaping.”
ExtraMile is also getting more location-specific on pricing tobacco, keeping it aligned with area competition. While dollar stores have provided some of this pressure, vape shops opening in its markets are doing so as well.
“Honestly, that’s a good thing,” says Casadont. “It’s helping to legitimize the offer, and helping create demand not only for their consumers but consumers coming into our stores as well.”
Packaged Beverages
For the HydraZone, the Extra- Mile team continues to focus on packaged beverages with high-demand, high-growth potential such as enhanced waters and energy drinks.
“We want to get those products into customers’ traffic patterns as they enter the store,” says Casadont. “There’s a certain set of customers who don’t want to walk back to the cooler, but it’s much more difficult for them to say no when the product is sitting within arm’s reach when they walk into the store.”
The ExtraMile merchandising team is “very bullish” on immediate consumption in general, beyond the cooler doors, to include salty snacks and candy. Expect to see new merchandising and presentation for these items later this year.
“The starting point for everything around the [in-store] offer is proven demand already for a particular product or concept,” says Paul Casadont, merchandising manager for the Americas (seen here, on the right, with Ian Noble, manager of district sales for the franchise, left, and Adrian Bendeck, general manager, center).
ExtraMile’s Extra Good To Go program offers a range of hot food from sausage and brats to taquitos and tamales. It also has a few fresh sandwich offers on the launching pad that are more targeted toward specific day-parts. “It’s less one size fits all, more targeted to specific shopping patterns in each location,” said Casadont.
Chevron has focused over the past several years on providing a consistent, competitive fountain and frozen-beverage offer, but it hasn’t yet reached the level of a true destination category, said Casadont. While the offer is competitive from the standpoint of pricing, cup size and variety, there is room for more customization. Chevron will be exploring new fountain technology in the coming months to help meet this preference.
Two years since the rollout of its Seattle’s Best Coffee (SBC) branded offer, the ExtraMile team is happy with the results, but believes there is even greater opportunity beyond traditional drip coffee. “Drip coffee is not growing at a very quick rate at all,” said Casadont, saying the real growth is in specialty coffees such as lattes and mochas.
While tobacco is a core focus of ExtraMile, it is no longer limited to cigarettes and OTP. The ExtraMile merchandising team is moving e-cigarettes into its tobacco backbar and testing vaping products at 10 sites. ExtraMile is also getting more location-specific on pricing tobacco, keeping it aligned with area competition.
Chevron is building its ExtraMile franchisee network in the main metropolitan areas of its three-state footprint: Seattle and Puget Sound in Washington, Vancouver and Portland in Oregon, and San Francisco Bay, Los Angeles and San Diego in California. The strategy is to build onto those metropolitan areas, creating the right density from a marketing footprint point of view.
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