Retail is all about location as is the fuel retail industry ; where to acquire or rebrand stores is the starting point but maximizing the profit potential of each site requires a combination of geospatial data analytics, customer knowledge and industry experience. The same actions throughout a network of sites will have different outcomes in different segments according to its location.
Fuel pricing and demand professionals can gain a competitive advantage by visualizing business information in a geospatial mapping environment to deliver more predictable and profitable outcomes on an ongoing basis.
Confidently creating winning pricing strategies, forecasting and executing is within your grasp with a personalized approach and the best mix of geospatial data, technology, and expertise.
An Ever-Changing Oil and Gas Market
Even before the COVID-19 crisis, the oil and gas market was volatile. Then, due to the pandemic and geopolitical issues, oil prices dropped to stimulate the market. Lockdowns reduced the number of vehicles on the road, which caused a demand reduction in some countries by up to 70%!
Margins and profitability in all regions have declined, and it is becoming increasingly difficult for fuel pricing managers to make decisions that improve performance.
However, during the pandemic, the value of convenience store baskets increased by 40 to 45% overall. This gave an edge to retail fuel stores that also sold convenience products. Adding new high demand product lines and in some cases, deliveries, helped to increase customer satisfaction, and profitability, while engaging new and loyal customers.
Thus, location analysis in fuel retail supports such data-driven decisions, based on advanced analytics, which is even more powerful when combined with industry experience.
Industry and Work Experience is No Longer Enough for Fuel Pricing Managers
Many pricing managers have traditionally been successful in making decisions based on years in the business. However, there are now so many variables and competitors that it has become nearly impossible to only rely on gut feelings; data is paramount and its quality must be ensured. In fact, according to a KPMG survey, 56% of CEOs are concerned about the quality of the data that they base decisions on.
Korem has been assisting fuel retail clients in using geospatial data for over 13 years, allowing pricing executives to switch from gut-based decisions to quality data-driven decisions, giving them a sizeable competitive advantage.
The Benefits of Data Visualization for Fuel Retailers
Why do some locations do better than others? 80% of retail data has a location attribute, and Korem sources a wide range of data to support pricing decisions.
Here are a few examples of how fuel retailers use geospatial data to gain a competitive advantage:
- Location-based sales data can be viewed on a map to illustrate what people are buying as well as when and where they are buying it. Data-driven analytics helps you to understand why.
- Historical and live car, truck and pedestrian traffic data show how transportation impacts on customer buying choices, including commuting and daytime populations.
- Geospatial data and technology allow users to visualize and overlay all stores, including your competitors’ outlets, and customers on a map:
- See where your profitable customers live, where they go, and adapt your offering accordingly, to better serve your best customers.
- Understand the socio-economic demographics of customers and what impacts their purchasing decisions.
- Compare customer demographics, including income and household expenditure, types of vehicle, fuel demand, and the c-store categories they prefer.
- View buying behaviors by time of day and day of the week.
Can You Afford to Wait Until Things Improve?
One Korem customer was able to generate $35M in new margins within the first three months of working with us. They were able to understand their real competitors, their loyal customers, and were able to adapt their pricing strategies and make adjustments according to geospatial analysis tools assembled for them. Our client is now able to continue to pivot and adjust to changing situations.
What Can a Personalized Integrated Solution Deliver?
Korem can combine information from internal and external data sources, including competitive pricing, traffic patterns and socio-demographic variables to derive insight. That insight will help you to:
- Accurately predict volume and deliver sales forecasts;
- Calculate cross-price elasticity based on demographics and patterns to maximize sales and profit. People in some areas will travel farther to buy at lower prices, while others will pay more for convenience;
- Understand, predict and track customer behaviors;
- Run ‘What If’ scenarios to predict outcomes of pricing strategies;
- Find correlations and create strategies combining fuel and convenience item sales;
- Make decisions that win business from competitors instead of being driven by them;
- Be responsive to changing patterns and able to adapt dynamically;
- Understand the heartbeat of competitors based on historical daily changes, area and distance to customers;
- Integrate and make sense of the huge and ever-growing volume of up-to-date data coming from consumers every day.
Be Ahead of the Curve with Geospatial Technologies
Using location data, technology, services, and expertise, fuel retailers make and justify smarter decisions. Fuel pricing managers can confidently demonstrate to their management teams, how and why their pricing decisions are made, and even use the same tools to quantify the positive outcomes.
When the industry is booming, it’s easy to come up with a strategy that appears to work. Even then, some players always seem to be doing way better than average. That’s because of the tools they use and the partnerships they have.
Today the industry isn’t booming, but leaders who focus on geospatial data are bucking the trends.
Start with Korem Today
Korem has a wealth of location-based data and technology, and a broad fuel retail industry experience. Our geospatial experts partner with our clients and take an agnostic approach to recommend the best solutions to help you achieve your business goals, including increased margins, improved customer satisfaction and loyalty, helping you grow a dominant position in the market.
We can leverage knowledge gained through partnerships in the industry while preserving the utmost confidentiality and integrity with our clients. As a trusted ally and through our unique one-stop-shop experience, we drive the successful adoption of geospatial technology, while managing risk.