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By Barbara Grondin Francella
INDIANAPOLIS -- Along with refreshing its convenience stores since splitting from parent Marsh Supermarkets Inc. in May 2007, Village Pantry LLC has also been reinvigorating its fuel business.
In an exclusive interview with CSNews Online, President Mick Parker said he and his colleagues at the 178-store chain have focused on developing strong long-term supplier relationships, which included reviewing the chain's contract with Marathon Oil.
At the time, the Indianapolis-based Village Pantry's 119 Marathon-branded locations sported a non-standard image, developed a decade ago by a management team that wanted something uniquely Village Pantry.
"We had a legacy image that quite honestly was unacceptable and customers weren't recognizing as Marathon," Parker told CSNews Online. "It didn't blend directionally with where we wanted to take the stores. We were revisiting our entire gas presence and looking to upgrade the entire Village Pantry image in the eyes of the customer."
After considering other major brands, Parker’s team quickly recognized the value of the Marathon brand. "Marathon has a strong market share in the Midwest and is the No. 1 brand in the three states -- Indiana, Ohio and Michigan -- where we operate,” said Parker. “Couple that with relatable supply and great customer service and it was easy for us to solidify our relationship."
Village Pantry signed a long-term contract with the refiner/marketer in January 2008, then went into overdrive, re-imaging every Marathon location by July. Included were new canopy faces, signage, pump skirts, pump valances, column and dispenser cladding and more.
"We were challenged with a very aggressive schedule to perform the image conversion," said Chris Noll, vice president of facilities. "Marathon and its suppliers were instrumental in fabricating, delivering and installing the physical materials. It was truly a collaborative effort."
The partnership with Marathon also brings support for employee training and community marketing initiatives.
Last June and July, timed with the re-imaging, Village Pantry rolled out a co-branded credit card program that offered first-time applicants 10 percent off the price of gasoline. Existing cardholders received 5 percent off.
As a result, the Marathon co-branded credit card usage went from nearly zero to 4 percent of credit card transactions.
Marathon also underwrote an employee-training program, developed by Village Pantry and approved by the oil company, that provided audio training via CDs to every store employee. "Marathon has a great program -- they'll reimburse us up to a specific dollar amount for pre-approved training on anything from merchandising, suggestive selling, customer retention, a whole host of topics," Parker said. Click here for more on Village Pantry’s outsourced audio training program.
This year, again with the support of Marathon, Village Pantry's human resource team is working on new employee and store manager training initiatives.
The brands also team up for local marketing efforts, including sponsoring Little League teams, local festivals and high school sports programs. Marathon matches the c-store operator's spending for as much as $250 per site for these efforts. "If you go to a local high school football game," Parker said, "you may see the home team's cheerleaders throwing T-shirts into the stands. Those shirts will have our names on them and are wrapped around a $5 Village Pantry/Marathon gas card. We're attracting younger customers and getting redemption in the stores. Plus, you see kids and adults walking around wearing our logos."
Despite the strength of the Village Pantry name in the Midwest, the executive team didn't linger on the idea of expanding its own gasoline brand. Along with reducing credit card fees, "one advantage of being with a major brand is a secure supply," Parker said. "In difficult times, such as the hurricane on the Gulf, we had a guaranteed supply. Even if we were put on an allocation, they would be reasonable allocations. It's important to serve our customers at times when others can't -- we reap those benefits."