Chevron is gaining momentum through its corporate social responsibility initiatives and a growing loyalty program with Safeway.
We increasingly hear that corporate social responsibility has become a business imperative. Not only do responsible and transparent approaches help build brand and reputation, they help strengthen the community and, therefore, the marketplace.
A solid business plan, embedded into the business culture, reflecting organizational values and objectives through strategic social responsibility application, will help to build a sustainable and profitable future for all.
For the folks at Chevron, corporate responsibility involves the search for an effective fit between businesses and the communities in which it operates. The notion of fit recognizes the mutual dependence of business and society—a business sector cannot prosper if the society in which it operates is failing. And that’s where Chevron looks to distinguish itself from others.
Through the years, the San Ramon, Calif.-based oil company has embraced a host of charitable causes literally across the globe—from economic development and youth services programs at home to healthcare services abroad for citizens in developing nations.
But Chevron has taken on a new cause of late that is both intended to support the community at large and groom a new generation of students to ascend into leadership positions in the future.
Following a highly successful launch in 2010, Chevron and DonorsChoose.org have partnered to expand the third annual Fuel Your School campaign. The program provides funding for eligible classroom projects developed by public school teachers and posted to the DonorsChoose.org Website in nine of the communities in which Chevron operates including:
• Alameda and Contra Costa counties, Calif.
• Orange County, Calif.
• Kern County, Calif.
• Sacramento County, Calif.
• St. Tammany, Orleans and Plaquemines parishes, La.
• Jackson County, Miss.
• Multnomah County, Ore.
• Harris County, Texas
• Salt Lake and Davis counties, Utah
As part of the campaign, Chevron agreed to donate $1 for every 8-gallon or larger fill up from Oct. 1-31 at participating Chevron and Texaco stations in those communities. Following the 31-day funding period, Chevron donated $4.49 million to fund DonorsChoose.org and its Website.
“Educating today’s students remains critical to our country’s future, but America’s schools face significant challenges and have fallen behind in science, technology, engineering and math,” said Dale Walsh, president of Chevron Americas Products. “Fuel Your School provides teachers with essential tools and resources that help students learn, explore and get excited about education to help prepare them for the jobs of tomorrow.”
While Chevron funds nine markets, public school teachers from across the U.S. are eligible to post classroom project requests on the DonorsChoose.org Website, ranging from pencils to microscope slides and even live tarantulas for use with biology lessons.
These projects are also eligible to receive donations directly from other business and private donors. The program is slanted toward STEM (science, technology, engineering and math) education.
During the 31-day funding period, Annie Marszal, general manager of family-owned California Retail Management—one of several dozen Chevron branded marketers to participate in the fundraiser—said some customers were so committed to the program that they would stop filling up at eight gallons then proceed with a second transaction of eight gallons to essentially double the donation.
“Of all the charitable causes that we have participated in through the years, nothing has been as popular and as embraced by our customers as Fuel Your School,” Marszal said. “What I liked most about this program is that while Chevron supplied all the signage and marketing materials to promote the program, they let each individual station connect directly with the schools in the communities where our stores operate. That resonated with our customers and the community, and helped strengthen the business.”
Marszal operates 25 stores in California and Hawaii including seven Chevron stations in California. Five of the stations participated in the Fuel Your School fundraiser.
“You would be amazed at how popular this program has become, not only to the community, but to our company employees,” Marszal said. “Many of our employees have students in the school district so they are not just promoting the cause, they are participating in it themselves.”
Marszal herself embraced the cause and helped raise funds for a digital microscope for a middle school down the street from one of her stores in Sacramento. She helped present the microscope to the class and watched as the teacher used the educational tool to open new scientific doors for his students. “They were amazed at the power of the microscope and its capabilities,” she said. “That made it real and brought this program to life.”
This is just one of thousands of success stories. Through mid-December, Chevron’s $4.49-million donation helped DonorsChoose.org fund classroom projects for nearly 700,000 students at more than 1,733 schools. There were 5,673 projects funded, including many math, science and engineering projects pushing Chevron’s desire to promote education in these key areas.
“We heavily encourage teachers to post projects to promote STEM education primarily because we at Chevron are really trying to build these core values in students at a very young age starting at kindergarten working their way up into college,” said Brent Tippen, external affairs and media relations advisor for Chevron. “The point is to help students learn and excel in the classroom, but also to help business prepare employees of tomorrow.”
While the funding period ended October 31, teachers had until November 30 to continue posting their school projects to the DonorsChoose.org Website.
“From our point of view, this is an excellent opportunity to help educate students, but ultimately we want to be able to have a work force that is skilled to be able to work in an industry like the one Chevron operates in,” Walsh said. “The fuel industry has always been on the cutting edge when it comes to developing new technologies and driving innovation. Now we feel we have a hand in shaping the young minds that will be leaders in the future.”
The success stories after three years are wide and varied. For example, in late 2012 Tippen, like Marszal, personally visited schools in New Orleans that had been hit by Hurricane Katrina and found they were still trying to rebuild some of the classrooms and procure key learning materials for students.
“One of the teachers we visited had a kindergarten class in need of math materials and reading charts to facilitate the learning process,” Tippen said. “She had a great lesson plan, but she lacked the tools she needed to effectively teach the kids.”
“We were able to help her class get set up on DonorsChoose.org to get those materials for the class and today the students are benefiting from the generosity of Chevron’s customers,” Tippen said. “We truly believe everyone deserves a superstar education to help our kids get ready for the challenges of tomorrow.”
Many public school teachers notoriously struggle to make ends meet, yet the average teacher spends an estimated $356 out of his or her own pocket to pay for school supplies. That adds up to a staggering $1.3 billion dollars in out-of-pocket expenses for teachers each year.
“When you crunch the numbers, you can see DonorsChoose.org is a viable funding mechanism for school systems that are already being strained by a weakened economy,” Tippen said. “There is a big need for companies like Chevron, private citizens as well as other companies to join together to support our teachers and our kids on their learning journey.”
While Chevron has been supporting education, it is also keenly focused on growing its retail business. To that end, it reached a deal with the Vons division of Safeway Inc. to offer a joint Reward Points loyalty program.
Customers who earn gas rewards by shopping with their VonsClub Card at Vons stores or a ValuePlus Card at Pavilions stores now can spend their rewards of up to 20 cents off per gallon at participating Chevron and Texaco branded locations in Southern and Central California.
The program began rolling out in early October, with the first station going live in San Diego, and continued to roll north. Some 1,000 pilot stores are now featuring the program.
Chevron and Texaco stores in the network area have the option to opt in, and Chevron has seen near complete participation in the program.
“It’s a win/win opportunity between Chevron, Safeway and consumers who will be able to do their grocery shopping and gain rewards. For every dollar they spend, they get one point, and 100 points equates into a 10 cent discount per gallon, and they can stack those to a maximum of 20 cents per gallon,” Walsh said.
While still in its nascency, Walsh said the response to the program has been exceptional. “While we are doing quite a bit of promotional activity around the program in California, customers are embracing loyalty pretty aggressively,” he said. “With the economic struggles we have experienced the past few years, it’s a natural extension of the business to reward our loyal customers.”
As with any loyalty program, simplicity is crucial to customer adoption. Chevron and Safeway ensured that their program was straightforward and uncomplicated for customers from sign-up to points redemption.
In fact, most customers won’t need to do anything at all to join. Vons card members are automatically signed up, and just need to head to their nearest Chevron or Texaco site to redeem points.
“The majority of Vons and Safeway shoppers are already club card members, so they’re already enrolled. Anyone who is not a Vons card member can join online or in the store through the Vons program,” said Mike Vomund, general manager of retail west for Chevron.
Redeeming points is also easy. Customers just swipe their cards or enter their phone numbers at the pump and watch the price roll back either 10 or 20 cents a gallon, depending on how many discounts they’ve accumulated.
“It’s a simple, easy to understand program that we believe is going to gain incredible traction for the convenience stores in our launch area,” said Vomund.
There are some small restrictions. At Vons, purchases eligible for reward points exclude beer, wine, spirits, tobacco, U.S. postage stamps, gas purchases and services, lottery tickets, gift certificates, and all fluid items in the refrigerated dairy section (including fluid dairy and dairy substitutes), among a few others.
THE PERFECT PARTNERSHIP
An ideal overlap in market areas and brand affiliation were the two key drivers in inspiring Safeway and Chevron to partner on loyalty.
“We both are looking at ways to drive our sales. Loyalty programs are in demand right now. Safeway and Chevron are two strong brands on the West Coast, and we see the opportunity to give the consumers what they want, which is to earn points and burn them on something they see as extremely valuable, which in this case is discounted gasoline,” Walsh said. “So there’s a natural drawing together given both of our quality brand initiatives on the West Coast.”
Vomund noted the increase in partnerships between gas stations and grocery/retail stores across the U.S. is consumer driven.
“The consumer has spoken, and they like being able to get rewards and points—be it for groceries or airlines. And they want to redeem these points for something they see value in. These programs where they can redeem points for fuel—that’s something that will drive consumer behavior,” he said. “In this case, it will result in a lift for Vons and a lift for Chevron, and the consumers are happy because they can now save 10-20 cents a gallon on a product they are purchasing on a regular basis.”
“We’re ecstatic about partnering with Safeway,” Vomund said. “We have the right brand connection as well as the work we’ve done with preparing to execute this program exceptionally well, and that is going to make for a great consumer experience. When you add together the brand connections, the simplicity of the system and program and 20 cents off a gallon—that’s going to resonate with the consumer.”