From self-distribution and unique product development to outstanding customer service and social media investments, Gus Olympidis continues to push the boundaries of innovation at Family Express.
By John Lofstock, Editor.
On a frigid February Indiana morning, about a dozen prospective employees rolled into Family Express’s state-of-the-art learning center in Valparaiso, Ind., to see if they have what it takes to become a company employee. The invitation to participate in this round of employee screenings, itself a journey that nine out of 10 candidates never get to make, is the culmination of an exhaustive process that will help the chain identify the people that can gracefully represent what it refers to as its “living brand.”
The living brand encompasses all that Family Express has become, and all it hopes to be. It is the company’s connection with the community; its people; its sponsorships of local and national organizations, of which there are too many to list; its service-driven culture; and, of course, its convenience stores. The living brand is a palpable entity that connotes trust, commands respect and guarantees a standard of excellence that employees carry with pride and customers have come to expect during each visit to Family Express. It literally permeates all aspects of the chain and lives on in perpetuity through each employee.
These screenings to help identify new employees are as much cognitive as they are cultural with the goal of inspecting the candidates’ DNA. Do they possess people skills? Do they have an aptitude for service? Can they solve a problem so that every customer leaves Family Express happy? Do they understand “customer first” is not a motto, but rather the mission?
“The Family Express challenge isn’t necessarily getting everyone to buy in to what we are doing here,” said Gus Olympidis, president and CEO of Family Express, the company he founded nearly 40 years ago in 1975. “The challenge lies in having the efficient mechanism in place to identify the people that are genetically and instinctively inclined towards building relationships. This is where our industrial psychology-based assessment process is helping us to identify folks that are that way, as opposed to trying to convince people to buy into a concept that is not compatible with their personality or their natural inclinations.”
While most companies hire with the intention of teaching new employees retail skills, Family Express, which operates 58 stores in Indiana, won’t even talk to them until they prove that they already have those skills. And that’s why the chain’s turnover is at a near industry low of 35% for frontline employees and 6% for managers.
Having to teach employees to be friendly doesn’t cut it at Family Express. It’s a quality that must exist in potential employees before they are even granted an employment interview.
The best retail companies can entertain their customers and leave them wanting more, and Family Express is no exception. Whether it’s Disney, Apple, Southwest Airlines or Family Express, success is predicated on melding great theatre with a wonderful customer experience in a host of areas—in the convenience store, in the community and even through social media. And at the end of the day, Family Express shares these same values to put on a great show whenever—and wherever—it can.
“For this industry, this continues to be a revolutionary way of thinking, but it is changing,” Olympidis said. “The success of assessment companies like PeopleMatter is gaining traction. They are seeing their list of clients in the convenience store industry increase and there is a reason for that. Companies want to be able to hire local people that can represent their brand as ambassadors—as people that really believe in what they are doing. I think there is a general understanding that if you make the right hire good things will happen. If you make the wrong hire you will find yourself trying to discipline people into developing a personality presence that is not natural to them or is not compatible with their values.”
Commitment to Excellence
Getting to this point was very much an evolutionary process for Olympidis, who is also a tireless legislative crusader that regularly communicates with lawmakers on behalf of the convenience store industry at the federal, state and local levels.
“Eventually, you come to the realization that a successful hire is clearly predicated on science, but there is also an art to it. And anytime you combine art and science you have failings,” Olympidis said. “For us, the ultimate deciding factor of fit is the evaluation by our training professionals as to whether a candidate has tested well, has successfully completed traditional HR screenings, such as drug testing and credit and criminal background checks, and whether that person has completed an assessment process that says he is a friendly person or a relationship-inclined person.”
The proof is in the pudding. During this pre-employment process, if the company determines that a person is not sufficiently engaging in delivering the living brand, it will cut the cord. Family Express has found that 20-25% of folks that are invited to its $4 million, 30,000-square-foot headquarters/learning center, which includes a full-sized Family Express training store, do not graduate.
“We are content with that,” Olympidis said. “We choose not to fail so we facilitate the earliest divorcement of non-compatible candidates that we can. Once we determine that the fit is not right, there is no reason to have this person tried by the system. You would be surprised at how comfortable that situation is because as we discover the lack of compatibility, the candidate is discovering the lack of compatibility as well.”
Just how serious is Family Express about being able to deliver its high expectations? Well, consider that the company had a store in Valparaiso, not far from its headquarters, which was a popular destination for breakfast, lunch and snack items for a host of residents and employees at other local businesses. Sales grew, but since the lot size was on the smaller side, the company had a hard time expanding to offer all of its new programs. Family Express and Olympidis made the call to shut the store down for good even though it was generating six figures plus for the bottom line.
“We could no longer deliver the full promise of the brand at this particular store even though it was contributing very significantly to the bottom line,” Olympidis said. “This was a tough decision. It was a decision that was postponed as long as we could, but the final straw was the development of our brewed Java Wave tea program, which required additional counter space that we clearly didn’t have. Our inability to deliver appropriate access consistent with the Americans with Disabilities Act was another deciding factor. The store simply didn’t have the tools to effectively and practically deliver the essence of what we do. And how can we justify that?”
One crucial distinctive area that sets Family Express apart from most other convenience stores is its focus on logistics and creating its own brands at its warehouse adjacent to its company headquarters in Valparaiso. By doing that, Olympidis said, it helps each store zero in on what’s really important in the convenience store business: the customer.
“Instead of the doughnut guy, the bread company, the milk man and the frozen pizza guy each making two or three deliveries a week, at Family Express we take all of these and turn them into one daily delivery for our stores,” Olympidis said.
In addition to being a warehouse, the facility is also a central bakery where muffins, cupcakes, cookies and the wildly popular Family Express’ square doughnuts are made.
At the end of the business day, the sales for each store are reviewed and a computer printout compiles a list of items that need to be restocked. By rethinking how the company stocks its stores it has cut the number of deliveries to each store from more than 30 a week from individual suppliers to just one per day from Family Express’ fleet of trucks.
Everything from snacks, foodservice, milk, bread and even fresh flowers is packaged for delivery for each store.
“This has been a game-changer for us,” Olympidis said. “It’s a matter of efficient versus inefficient delivery. When you push the envelope of innovation you usually have some unpleasant surprises. We have had our share of those, but we also have had some pleasant surprises that were not anticipated. The biggest one was unsurpassed freshness. Typically you don’t go to the convenience store for freshness, but because of our logistical model and our automatic replenishment wherewithal, we can offer the consumer a gallon of milk that has about two weeks of shelf life. The big box cannot do that, thus unsurpassed freshness becomes a competitive advantage.”
At the same time, the company’s marketing team has created a series of brands exclusive to Family Express, which has helped create a unique identity, such as the Cravin’s Market foodservice line, Family Express Natural Spring Water, Java Wave gourmet coffees and teas and Buzzed Energy drinks to name a few, as well as several grocery items.
To support the in-store program and drive business to the forecourt, Family Express also offers the growing FE Perks loyalty program, which offers instant cents-off-per-gallon savings at the pump for purchases inside the store. Registered FE Perks members also receive a variety of digital coupons for grocery and food items on a weekly basis. To complement the loyalty program, the chain has developed a mobile app with GasBuddy OpenStore to promote in-store specials,
current gas prices and store locations.
Communicating with customers through social media is uncharted waters for retailers, but one they need to quickly master. Family Express has made a significant investment in social media which included hiring SocialPeople, an Atlanta-based social media consulting company that specializes in integrating a social media strategy into a company’s existing processes. The chain also hired a social media community manager to its executive team.
“Social media is the contemporary way of human engagement,” Olympidis said. “For a company that wants to operate at the top performing level, social media is an absolute necessity.”
SocialPeople is helping lay a foundation to a best practices level and over the course of a year, Family Express has made dramatic inroads. Its followers on Twitter crossed 1,400 in April and its Facebook page has nearly 4,100 likes.
“We are benchmarking ourselves against top performers across the convenience store industry,” Olympidis said. “Our rate of growth within two months should bring us at a top-performing level when prorated in terms of per store active followers.”
Many retail chains when investing in social media programs often struggle to calculate the return on investment. However, focusing strictly on traditional ROI when developing a social media strategy can prove to be shortsighted.
“Trying to calculate the return on a social media investment is a lot like trying to calculate ROI on clean restrooms or great service,” Olympidis said. “I think focusing on social media ROI is intellectually myopic. Social media is not an elective. The geopolitical makeup of our world has changed because of social media, and it’s having a significant impact on how customers view brands and make purchases. We feel that the opportunity to redefine our marketing presence in social media terms is somewhat perishable, so we don’t want waste time debating as opposed to deploying.”
Equally important to Family Express is that social media engagement is not just for younger people anymore and it continues evolving everyday. “It’s older customers, it’s females—our core target groups—that are engaging our brands in a new and exciting way,” Olympidis said. “So while lethargic organizations are going to try to analyze social media in the only world they know, which is the traditional world, we hope to outpace them while they are endlessly and needlessly debating the obvious.”
At Family Express, the company is engaging customers by projecting the living brand and soliciting their input on everything from the products the company carries to
pricing. “We are correlating our brand with other brands that they deem to be valuable, including our sports marketing presence at Valparaiso and Purdue universities,” Olympidis said. “This new frontier is not about forcing content out as much as it is inviting input and staying visible. It is traditional marketing turned on its head.”
The ability to engage the community through social media also allows companies to monitor what customers think about their brand in real time and, even more importantly, to respond to customer feedback, both positive and negative.
“If you think of a negative comment about your brand on social media it is like have a demonstration going on in front of your store and all you do is drive right by and ignore it. You would not ever think of doing that,” Olympidis said. “If you are not active in social media, you are not going to be aware of the digital demonstration going on every day. Social media engagers just want to be heard.”
As such, retailers can generally diffuse a problematic situation and turn it into a positive as long as they are in the space. Not responding in the same space to the folks that are participating translates to ignoring the problem. “So it continues to inflame whatever negative connotation that exists. Sometimes all you have to do is offer an explanation or tell them that you take their comments seriously and will look into it,” Olympidis said.
Family Express is taking engagement a step beyond what others are doing anywhere in the c-store industry by making the tactical decision to advise its followers on Twitter what it knows about gasoline pricing trends. So if it anticipates fuel prices will be dropping, or are about to go up, it lets customers know so they will make their fuel purchase accordingly.
“We are betting that if you are a follower, you will appreciate the fact that you are not going to fill up your car and find out later that day that prices dropped by 20 cents a gallon,” Olympidis said. “That is going to have a market impact, but it will also have a margin impact that will affect us in some fashion. However, we believe that we are building genuine relationships with the earnest delivery of information that our experts have in-house ahead of schedule. And if customers choose to take advantage of the trend lines as we see them, we think this will endear us to them even more.”
The positive feedback on this program is evident in social media itself. The company’s alerts are retweeted over and over and customers routinely post messages of thanks. “We see comments all the time that say, ‘Family Express was right again. Prices did drop.’ It creates a goodwill in the context of delivering content that is relevant to people,” Olympidis said. “That is what you need to be doing with social media. It has got to be relevant. Don’t keep bombarding people with annoyances about how good you are. If you are sincere, appreciate your customers and communicate honestly with them, they will remain loyal, and that’s an integral part of the foundation we have built at Family Express.”