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    CSNews Exclusive: Gulf Oil Wins With Value Programs

    The petroleum marketer sees success with a fuel savings program called Override, as it simultaneously develops dozens of other projects for its customers.

    By Mehgan Belanger

    NEWTON, Mass. -- Customers to more than 110 stations selling fuel provided by Gulf Oil L.P. are smiling, thanks to the fuel wholesaler's recent expansion of Override, a gas savings program conducted in partnership with Shaw's Supermarkets and Dunkin' Donuts. But motorists are not the only ones pleased with the program.

    "There are no adjectives big enough to explain how happy we are with the results of the program," Rick Dery, chief marketing officer for Gulf, told CSNews Online.

    Through the Override program, customers to either Shaw’s Supermarkets or Dunkin’ Donuts can earn gas savings by making purchases at the grocer's or quick-service retailer's locations. Shaw's shoppers who make a minimum $50 purchase with their Shaw’s Rewards Card earn 10 cents off per gallon of gas, up to 20 gallons, while Dunkin Donuts’ customers who accumulate $20 in purchases with a Dunkin’ Rewards Card earn 5 cents off each gallon of gas. Shoppers can also combine rewards earned at both retailers for additional savings. To redeem the savings, customers swipe their Dunkin' or Shaw's loyalty card at the pump, and the discount is credited.

    The program's benefits to Gulf and its network of stations include giving Gulf a competitive offering against other loyalty programs in the market; adding value to jobbers and dealers, which should attract additional value to the network; and most importantly, providing value to the consumer, said Ron Sabia, president and COO of Gulf.

    "From the customer standpoint [dealers and jobbers], we always look for ... programs they can be part of to save them from a cost or enhance their revenue," he said, adding later Gulf cannot survive without its customers thriving as well.

    One Gulf-branded retailer located in North Attleboro, Mass., provides evidence of the program’s value. On two consecutive days in early April, the station made between 150 and 200 Override-related transactions each day. The retailer told Gulf officials that as a result of the program he's seeing new faces at the store that he's never seen before. Other participating Gulf locations in that area around the Shaw's supermarket are tracking 16 percent to 20 percent increases in daily volume, according to Dery.

    Override was piloted at eight Gulf locations in the Worcester and Gloucester, Mass., markets beginning the first week of March. By the 20th of that month, a deal was signed to expand the program, and within a week, 100 sites had signed up for the program.

    As of early April, 117 Gulf-branded gas locations across Connecticut, Massachusetts, Rhode Island and Vermont were participating in the program, and company officials expected that number to exceed 300 by May.

    While the program is new to the Gulf network of more than 2,400 retail fuel locations, the fuel distributor wanted to develop a loyalty program for some time.

    "After 2005, when we took over management of Gulf, and when gas hit the $4 per gallon mark, retail motorists became hypersensitive [to gas prices]," Dery said. "Even though gas prices have fallen below $2 per gallon, that sensitivity toward prices hasn't lessened."

    Because of this, Gulf leadership directed the marketing group to develop a program to address consumers' feelings toward fuel prices. "This was a perfect solution for what we needed and what customers were demanding," he said.

    Gulf chose Override because the provider works to bring "earn partners"—such as Dunkin' and Shaw's—into the program.

    "There are a number of ways people can participate. It isn’t limited," said Dery. "We felt that while the grocery partner is a huge element of program, we didn't want to limit the earning ability." He added: "On the horizon we have extremely interesting earn partners coming down the pike."

    Another reason Gulf chose Override was its interconnectivity. Because the program allows consumers to stack rewards from different retailers, customers can make redemption more convenient by linking rewards cards from multiple retailers to one Override rewards card, and manage their account online, explained Sabia.

    The Override technology required at participating stations consists of a "black box" that is plugged into the store’s technology systems to process redemptions. Similar to credit card processing, Override manages the transactions. Gulf officials expected code writing for the pump rollback—when the gas price displayed at the pump "rolls back" to reflect the discount price after the reward card was swiped at the CRIND—to be complete by mid-April.

    To promote the program, participating Gulf sites are provided signage. Override also employs ambassadors to educate consumers about the program at earn partner locations. This summer, Gulf will hire a staff of interns who will promote the program at the store level with two branded vehicles.

    The Override program also opens up the doors for Gulf to provide a variety of other value-oriented offerings to its network and consumers. While declining to provide specifics, Sabia noted the company has more than 38 non-motor-fuel programs for dealers in the works, some of which include a new partnership with Subway and an electricity-buying program. There is also the previously announced price-cap program, which Sabia said was moved forward in development thanks to the Override program.

    "Override is providing a platform to provide other things, such as a price-cap card," he said. "The mechanism—the rails, so to speak—for Override serves as foundation to develop a price-cap card. That isn’t coming out anytime soon, but it’s a huge step in getting that to market."

    Related News:

    -- Gulf Takes Customers Out to the Ballpark

    -- Gulf Oil Joins Fuel Savings Network

    -- Gulf Oil Completes New Leadership Team

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