Wawa's merchandise sales actually grew last year, although the growth rate is down. "We're doing OK," said Howard Stoeckel, chief executive officer of the privately held convenience-store chain. "We're not up to historic averages, but we're performing better than the vast majority of retailers."
He credits a strong focus on value and a concerted effort to make the time a customer spends in the neighborhood Wawa a respite from economic gloom. "People want to feel good," he said, "even if it's for four or five minutes a day when they're on their way to work."
Better at the basics: "If there's anything that we're doing through these challenging times, it's digging deeper into the soul of the brand," Stoeckel said. "We've got to do what we're known for that much better."
In particular, the company has made an effort to move customers in and out in less time than usual, to keep sandwiches and drinks affordable - hence the $3.99 flatbread sandwich rollout, the current 99-cent fountain drinks, and the $2.99 Hoagiefest deals - and to foster the loose, friendly in-store vibe that Stoeckel said was Wawa's most durable competitive advantage.
"A lot of people can sell coffee. A lot of people can sell hoagies. A lot of people can sell gas. But no one sells it in the same fashion," Stoeckel said. "That has sustained us during these difficult times."
The way of the Wawa: "When we ask customers what do they like about Wawa, they say, 'We like your people,' " Stoeckel said. "And when we ask them, 'What is it that you like about our people?' it's that our people like each other - and customers get caught up in that experience.
"That is priceless at a time when people have pangs of anxiety about the economy, about their jobs, about their retirement," he said. "If you can help people feel better, that goes a long way." Stoeckel said the company gave its general managers carte blanche to fashion a hyper-local "Cheers experience" for each of the company's 569 stores.
Shiny, happy people holding stock: The good vibe also comes in part from employee stock ownership, Stoeckel said. Together, about 8,000 employees own about 28 percent of Wawa, currently ranked the 69th-largest private company in the nation by Forbes magazine, with $5 billion in revenue for 2007.
"They have an emotional attachment to the brand, but they also have a financial attachment," he said. "They want to see this company survive over the long term."
Recession concession: Wawa has stores in Pennsylvania, New Jersey, Delaware, Maryland, and Virginia. The company has considered expanding beyond the Mid-Atlantic region, but "now's not the time to do it," Stoeckel said.
Indeed, he said most new Wawas that open in the next few years would be within 100 miles of Philadelphia. "It's not a time to venture far from the homeland and it's not a time to try new and exotic things."
Coming attractions: Despite the economy, the company will continue to roll out semiexotic brand extensions, such as the flatbread sandwiches. Wawa smoothies and frozen cappuccinos are now being test-marketed.
Online, the company is setting up quirky microsites for promotions such as Hoagiefest (hoagiefest.com, featuring the groovy "Here Comes the Hoagieman" song) and Dress Your Bottle (dressyourbottle.com), a promotion that lets customers outfit a bottled soft drink with accessories such as guitars and berets.
"If you don't try new concepts, you begin to die," said Stoeckel, who started his retail career fresh out of college in 1967 at John Wanamaker's and has fond memories of watching delivery trucks circle City Hall waiting to unload. "Wanamaker's didn't change, and they perished."
The early bird gets the job: He had not necessarily planned to work in retail. "Like many college grads, I wasn't too certain of what I wanted," he said. Then fate landed him at Wanamaker's soda fountain.
"The Monday after I graduated, I drove to Philadelphia. I had an interview [elsewhere] later that morning, and I'm a person that has to get to work early - I never like to be late - so I was way early.
"I had a lot of time to kill, so I went into Wanamaker's," he said. While drinking a Coke at the fountain - "a cherry Coke to be exact" - he noticed a sign for the employment office and decided to try a practice interview there before his scheduled one.
"I was nervous," he said. "So I figure, I'm going to get rid of these butterflies." He left with an offer to join the department store as an executive trainee.
A below ground-floor opportunity: His first job involved handling deliveries, packing, and distribution "way down in the subbasement of the John Wanamaker main store," Stoeckel said.
"I walked through the subbasement, which was not very pretty - it's still there today, but it's a parking lot - and I was talking with people and I said, 'Boy, I really like what I see here.'
"They were nice people, friendly people, all doing their job," he said. "And I said there's only one way to go and that's up."