Store24 - New England’s Largest Convenience Store Chain

• Store 24, one of New England’s largest convenience store chains, implemented a new customer intimacy strategy referred to as “Ban Boredom.”
• CEO believed that providing an entertaining shopping atmosphere, including frequent themes and promotions, would differentiate the shopping experience at the chain from its competitors.
• Hoped to create loyalty to Store 24 among its targeted customer base of young, urban adults between the ages of fourteen and twenty-nine
• Actively promoted Ban Boredom strategy on billboards, buses, and trolleys.
• Its retail outlets placed a large display case at the head of the center aisle to feature high margin promotional items for the current theme, such as life-sized cutouts of movie stars and discounted videos for an “old movie” theme.
• Store managers given significant autonomy and flexibility in implementing Ban Boredom themes => Manager and crew skill may be key to success of strategy.

Ban Boredom strategy meant to complement core strategy “Cause you just can’t wait” (CYJCW).

• After several years of Ban Boredom, CEO became concerned that strategy was not working.
• The question: Is Ban Boredom working?  If not, is it a bad strategy or is it just being poorly implemented?
• How can Store 24 use their strategy map and measures from their balanced scorecard to address these questions?

• To address this issue, recall that the strategy map posits cause and effect relationships:

        Learning & growth => internal processes => customers => financial outcomes

• Store 24 strategy hypothesized that: Ban Boredom => Customers => Profits
• In their balanced scorecard Store 24 includes a Ban Boredom execution quality measure.  
• To test for causality,  examine the statistical relation between stores’ Ban Boredom execution quality measures and their future store profits.
• The relation is slightly negative!
• They also found that customer satisfaction was positively influenced by the quality of the Ban Boredom implementation.
• Thus, customers noticed differences in the quality of the strategy implementation, but measured customer satisfaction did not translate into higher profits.
• Suggests the strategy itself might be flawed!
• Stores with high crew skills that implemented Ban Boredom effectively had higher profits than stores with high skilled crews that were less effective in implementing the strategy.
• Stores with low- or average-skilled crews that faithfully implemented Ban Boredom were less profitable than stores with low- and average-skilled crews that focused on operating efficiency (CYJCW) and did not implement the Ban Boredom strategy.
• Success of the strategy critically dependent on skills of the employees in the store.
• Inexperienced personnel who followed Ban Boredom rules did not serve customers well and introduced inefficiencies in operations, and that led to lower store profits.
• Experienced crews, in contrast, maintained operating efficiency and customer satisfaction while creating the differentiating buying experience of the Ban Boredom strategy.
• Drop Ban Boredom
• Keep Ban Boredom, but increase expenditures on increasing the skills of store crews.
• Keep Ban Boredom – but implement it only in stores with properly skilled crews.
• Firm dropped Ban Boredom strategy
• Performance Measurement system updated to reflect efficiency (CYJCW) strategy only
• Is there something wrong with the strategy or is it poor execution?  Can we
• cite examples of facing this dilemma in your organization?

[pic 1]

...