Monday, November 10, 2008

Wawa Case Study by Emily Kanoff

Introduction
Just fewer than 600 Wawa stores litter Pennsylvania, New Jersey, Maryland, Delaware and Virginia. As one of the largest and most profitable private companies in the country, Wawa has provided its customers with top quality food and customer service for generations.
Wawa origins date back to the early 19th century when the Millville Manufacturing Co. first opened its doors. Originally starting out as a large textile company operating in several states, the company began to change shape when its owner, George Wood, became interested in dairy farming. To begin his foray into processing dairy products, Wood established a plant in Wawa, Pennsylvania, a suburb west of Philadelphia. Although Millville was still operating, the dairy farm became known as Wawa Dairy farm. It should be noted that the name Wawa is the word for goose in the Native American Lenni Lenape language, and also contributes to the chain’s logo, a goose in flight.
Wawa Dairy Farms grew in size and began a delivery service to homes and businesses throughout the region. Owing to the rise of supermarkets and the fall of milk men, Wawa Dairy farms took note of the changing times and opened its first Wawa Food Market in Folsom, Pennsylvania in 1964. The store sold both national branded products and Wawa products and became a hit. After adding two more stores, Millville Manufacturing Co., Wawa Dairy Farms and Wawa Food Markets merged to be collectively known as Wawa Inc.
Over the next two decades Wawa added nearly 80 more stores, employed some 2,200 people and reached sales of $140 million a year, all while managing to stay private and family-owned. Several factors have contributed to Wawa’s success and expansion ever since, but staying true to their core values and establishing their niche have led to nearly 600 stores, 16,000 employees, and billions of dollars in revenue.
Situation Analysis
Since they opened their first store, Wawa Inc. has had the task of staying on top of an increasingly competitive market. Because Wawa is a convenience store, customers want just that—convenience—and patience wears thinner every day. Because of the fast-paced society that we live in, Wawa’s biggest obstacle is changing with the times and adapting to their customer’s needs. Coincidentally, it is this adaptation that has kept them the leader in their industry for decades. Wawa has a keen ability to find the hole, or “cherchez le creneau” and filling it with new and innovative ideas that not only keep customers happy, but differentiate them from competitors so that they become the only option. The following factors contribute to Wawa’s success:
Stay true to core purpose
Wawa’s slogan is “Simplify the lives of our customers.” It is these words that the company and its employees live by. Simplicity and ease are the keys to convenience, which is the overall goal of the industry. One example of Wawa’s dedication to its slogan has always been making the payment process easier. Before the development of ATM services, Wawa offered a paperless cash-access system in 1977 that allowed customers to withdraw up to $25 a day from their bank accounts. This system was eventually abolished but is known as the precursor to the ATM.
Another way they try to make its customers experience even easier was to differentiate from competitors and to make the most of their, on average, 3000 square feet space. Wawa formatted the stores in a way that was easier for the customers to maneuver through. As opposed to the conventional convenience store goal of getting a customer to buy things that they did not intend to buy, Wawa’s aim was to get the customer in and out quickly. Onetime vice-president of marketing Frederick Schroeder, once told Chain Store Age Executive, “Architecturally, we made the checkout area remote from the sandwich/deli area. This is more labor-intensive, but we feel it makes it much more comfortable for the consumers to shop our stores. We also removed the beverage area from the deli, also to make it easier to customers to get in and out of our stores.” (Robert Halasz)
Throughout the continuous addition of new stores, existing stores are not forgotten. To accommodate popular locations, Wawa has been known to buy adjoining property to add several parking spots to accommodate traffic and congestion. The year 1999 saw the addition of touch screen monitors that helped to speed up made-to-order food.
Expand and improve while always adhering to core values
Wawa’s core values are as follows: value people, delight customers, embrace change, do the right thing, do it right, and passion for winning.
Value People
In the late 1980s, Wawa experience lower sales and an increasingly slow employee turnaround rate. To combat these issues, they went back to one of their core values, which was to value people. These ‘people’ are not limited to customers, but to employees as well. The President’s Club is an annual event created to recognize top performing general managers. Each year the top 20% of general managers are brought together at a resort location to celebrate their financial and business achievements. Store associates are also rewarded for their achievements with surprise in-store parties that offer prizes to top performers.
Delight Customers
Part of Wawa’s appeal is the neighborhood feeling that translates back to their “milk men” days. Many stores feature coffee hosts who maintain the coffee areas and chat with customers. In 1985, the company began test-marketing Lite Bite salads, its first product directly targeted to working women. These tests were a reaction to what research found was a huge part of their clientele—young white-collar workers. At the time, it was widely accepted that the typical convenience store customer was a young blue-collar male. However Wawa found that by keeping its stores neat and clean and offering healthy alternatives to the usual snack food staples, they were appealing to working women.

Embrace Change
When the door-to-door delivery milk service died out with the advancement of supermarkets, they opened a store. When dinnertime business needed to be stimulated in the early 90s, the company introduced a new buffet line of chilled entrees. In the new millennium, toasted sandwiches were being requested by customers, so Wawa outfitted their stores with state-of-the-art ovens that allowed their signature hoagies to be heated in an efficient and pleasing manner.
Do the Right Thing
To maintain a wholesome image by halting the sale of adult magazines, cigarette papers, and beer in the 1980s. As a family-owned business, the company wanted to make sure their stores were appropriate for customers of all ages. Wawa has contributed millions of dollars to charity organizations including the Susan G. Komen Breast Cancer Foundation of Philadelphia, Special Olympics, Children’s Miracle Network, Juvenile Diabetes Research Foundation International, American Red Cross, Cycstic Fibrosis Foundation, and Johns Hopkins Children’s Center. They work with 50 different groups to employ more than 500 special needs persons as Wawa associates. Not only to they donate to their own charities, but Wawa offers a fundraising program for community-based non-profit organizations to raise money for their own causes called ‘Wawa Hoagie Fundraising.’ Groups can buy Hoagie coupons for $2.50 and resell them for $3.50.
Do things Right
Wawa is a company that prides itself on being the best in its industry. This includes the best products with the best customer service and leaves little room for error.
Passion for Winning
It was a long road to get to where the company is today. A strong dedication from the upper management, the cashiers, and everyone in between, is what it takes for the company to continue to thrive. There will always be competitors and copycats, but the passion that Wawa employees share makes the company stand apart from the crowd.
Distinguish themselves from competitors
To distinguish itself from competitors, Wawa specialized in certain aspects of the convenience store and capitalized on its successes. These not only filled holes in Wawa’s brand, but in the industry as well which helped customer’s to associate convenience to the brand even more. In 1995, Wawa introduced an unheard of convenience at the time—ATMs free or surcharge.
To create a total one-stop-shop experience and to compete with gas station and convenience store chains, in the mid 1990s Wawa started adding fuel stations to their locations. The first gas station opened in Millsboro, Delaware in 1996 and more have been added every year since, which brings the number to over 200 across the five states.
One of Wawa’s top sellers is their coffee. By creating a brand with several different varieties at a very cheap price, the company has successfully created hundreds of thousands of daily customers. Because coffee is so personal to so many people. Wawa found the right product to specialize in. By 2008, Wawa held the leading share of coffee in the Philadelphia market and the #7 share nationally by selling over 195 million cups each year.
Almost all of the company’s locations are open 24 hours, 7 days a week. This separates them from the rest by making their business available at all hours of the day. Instead of just being a breakfast or lunch place, Wawa customers are able to get their fix late at night after a long day or early in the morning to start their day off right. The availability of its products makes it easier to fit into everyone’s daily schedules and become a part of their routine.
Stay private, which contributes to quality products, good service and a neighborly feel.

One of the most interesting things about Wawa is that with all of its successes, it would only be a natural progression for the company to go expand their brand exponentially by going public. They have however, decided to stay privately owned. Although 2005 saw the CEO become a non-family member, they are dedicated to keeping their family appeal by staying small enough to offer the best quality products yet large enough to accommodate the most number of people in the five states in which the stores are located.

High quality products and low prices
High quality products are a huge part of why Wawa customers come back day after day. With a good balance of national branded products and Wawa brand products, customers know that what they take away will be fresh and delicious. Whether it’s milk or coffee, a hoagie or a signature Wawa salad, the ingredients are always fresh and comforting.
Stay current and in the news with promotional activities
To capitalize on their dominance in the world of hoagies, Wawa petitioned Mayor Edward Rendell to name Philadelphia the official sandwich of Philadelphia through a promotion that garnered over 30,000 signatures to support the designation. May 6, 1992 was dubbed ‘Hoagie Day’ and Wawa celebrated by building a 500 foot-long Hoagie in its honor. The tradition has continued ever since with the hoagies getting bigger and bigger each year.
The year 1994 marked the 30th anniversary for Wawa as a convenience store. Because this coincided with Ford Motor Company’s reintroduction of the Mustang, Wawa gave away one 1960s Mustang a day for 30 days.
More recently, Wawa celebrated the sale of their billionth cup of coffee in the new millennium by announcing their new campaign “Coffeetopia” which is a “celebration of all things Wawa coffee. According the press release, “Wawa Coffeetopia is an 8-week in-store campaign that celebrates all the reasons people are passionate about Wawa coffee. The promotion features a different Wawa coffee variety highlighted every two weeks for customers to sample in all Wawa stores, the launch of a new microsite dedicated to Wawa coffee lovers, as well as the introduction of a new Wawa Cup design with rich, warm colors. Wawa Coffeetopia also gives customers a chance to win one week’s worth of free coffee by getting “perked” in weekly in-store drawings.”
This summer, Wawa held another event for Hoagie lovers around the area, with ‘Hoagie Fest.’ Hoagiefest kicked off with a proclamation officially designating July 16 “Hoagie Heritage Day,” The festivities included with a series of hoagie and 1960s-inspired contests, giveaways, and activities celebrating the great hoagie tradition, including: Hoagie building contests involving the public, Hoagie building contests involving the 7th & 8th Police Districts for charity, Hoagie eating contests, The crowning of Mr. & Mrs. Hoagie, and A walk through exhibit featuring sixties images interspersed with Wawa famous hoagie milestone images.
News Articles
After researching articles about Wawa’s recent promotional campaigns, I found that the news outlets for the most part just wrote straight from the press releases. There was not much coverage of ‘Hoagie Fest’, but ‘Coffeetopia’ got a good amount of coverage. Because it is a brand new campaign, I expect the coverage to increase as the campaign moves forward.
PR Professional Interview
I spoke to Patrick Menton, a Publicity Manager at RCA Music Group. Although he now works in music, Patrick got his start in consumer products. By answering a few simple questions, Mr. Menton was able to shed some light onto the situation.
Q: In your professional opinion, what do you think is the reason Wawa is the leader in its industry?
A: Wawa is able to stay on top because it is synonymous with convenience. Customers know that they can get in and get out in no time.
Q: What makes customers so loyal?
A: Consumers like a brand they can trust. Wawa customers know they are getting a quality product so it makes shopping there a no brainer
Q: Do you think promotion should be a bigger part of their future plans?
A: In some areas where Wawa is the only option for quick food, excessive promotion isn’t necessary. However in areas where competition is inevitable, Wawa needs to prove that they are the superior brand.
Q: Would you ever want to work for the brand?
A: They are so successful, I imagine it’s probably a dream job to handle their publicity.
They are so successful, I imagine it’s probably a dream job to handle their publicity.”
a professional PR person (from the company if possible) about the case – what are their thoughts about how the company and PR person handled it? If you cannot interview a PR person directly involved with the case or who is now with the company/organization, select a PR person in the same field/industry.
Evaluation
Wawa is a company that found a niche and ran with it. Branding is a strategic part of starting a company or introducing a new product and it can make or break that business or item. Wawa new from an early point that simplicity was their goal and customer relations was their priority.
7 Eleven and Sheetz are the two companies most closely related to Wawa. Although 7 Eleven is bigger in other parts of the country where Wawa does not exist, when paired with Wawa it cannot compete. Whereas Wawa opens new locations continuously, 7 Eleven closes its doors almost as much.
After doing research, it is clear that Wawa and Sheetz share many of the same qualities. Both are family-owned, cater to the same part of the country, and offer nearly identical made-to-order food. However, although it has been open for 10 years longer than Wawa, it has failed to garner the same respect and notoriety. This could be due to Wawa’s dedication to customer service and quality of food. As both chains continue to grow, it will be interesting to see the tactics they use to differentiate from each other.

4 comments:

Anonymous said...

"Just fewer than 600 Wawa stores litter Pennsylvania, New Jersey, Maryland, Delaware and Virginia." You said a mouth full have You ever seen all the litter generated from these stores for miles around them..the bonus for those living close to a WAWA are the weekly clean-ups by the hired maint. contractors that simply blow the trash/litter from the wawa lots into the surrounding area.I know You probably didn't mean the term litter in this way, but if the shoe fits...

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