Future-proof your stations by reimagining them as mobility & convenience hubs

What are the biggest challenges for fuel retailers in today’s and tomorrow’s markets? With stations becoming multi-energy hubs with a wide range of services, what will be the role of data in the operations of the site? As we move forward, mobility is changing on all fronts. How does this disruption impact service stations and convenience stores?

Customer journey

The customer journey is becoming more focused on convenience and sustainability. Technology is enabling new ways of customer engagement, leading to a shift from vehicle-centric petrol stations to customer-centric convenience stores and retail hubs. Mobility as a service allows for end-to-end journey planning through various modes of transportation in one app, with integrated planning and payment options. Think about Whim (Helsinki), Beeline (Singapore), Qixxit and Moovel (in Germany), or Smile (in Vienna). Generation Y and Z are particularly interested in convenient and sustainable solutions, leading to a shift towards shared services and e-mobility in the oil and gas industry.

Data is the new gold

Data is crucial for service stations to become mobility hubs. Customers expect personalized offerings, and data about their preferences, location, and movements is key to building successful business strategies. In the context of smart cities, data from systems, sensors, and cameras can provide valuable information for traffic management and access to cities. Autonomous vehicles can be re-steered using this information. Data is the key to optimizing strategies for retailers.

Challenges ahead in the fuel retail market

Smart cities, smart mobility, and autonomous vehicles bring both threats and opportunities for service stations. Impact may vary by location, with highway stations likely to be more resilient. Urban and suburban stations face greater challenges due to the high penetration of EVs, advanced mobility options, reduced gasoline demand, and reduced traffic. Suburban stations can evolve by providing parking and rental options, while in-center retail stations may become retail hubs. Retailers need to adapt their offerings and build relationships with new partners to stay relevant in the evolving market. Zumo for instance, a UK-based company, picks up cars while people are working to just charge them on their premises.

Fuel retailers need to reorient themselves

The fuel retail market is shifting away from fossil fuels and toward alternative fuels, and away from focusing on vehicles to focusing on customers. This shift makes fuel retail an important gateway to diversification and an opportunity to pursue sustainability objectives through the marketing of sustainable products and services.

Rethink future networks

Fuel retailers need to rethink their networks and repurpose assets for a future where hydrocarbon fuels are no longer dominant. This involves deciding which stations to close and where to expand based on factors such as location, quality, and flexibility. To better serve customers, retailers need to understand their behavior and needs, offer tailored convenience, and expand their product offerings. This may require adjusting their ownership model and mix of CoCo/CoDo/DoDo and franchising options.

Reimagine stations as mobility & convenience hubs

The current business model for service stations is focused on fueling and servicing vehicles, as well as offering coffee and snacks in the convenience store. To survive, stations need to evolve to a customer-centric model and focus on all of their customers' needs. This can be achieved by transforming the convenience store, capitalizing on real estate and strategic locations to become a services and logistics hub, and making the pump sustainable with EV, hydrogen, and biofuels.

Revamp loyalty & personalization programs

Technology and data can help companies shape their B2B business models in various ways, such as creating value-added services, managing costs, enhancing customer convenience and experience, and making data-driven decisions. Customers are willing to share personal data for convenience. In a customer-centric approach, retailers should focus on the customer's lifetime value instead of product-led strategies. Combining transactional data with contextual data allows for hyper-personalization and tailored pricing, product recommendations, and promotions. AI algorithms can predict customer behavior and enable personalized incentives.

New adjacent value pools & partnerships

As a fuel retailer, it is important to serve customers throughout the vehicle life cycle, offer alternative fuels, and support business customers in achieving their sustainability goals. New growth areas include used-car purchase/sale (e.g. Vitol & Vavacars), car insurance and vehicle financing (e.g. ENOC & Beema), innovative fuel provision (e.g. ENOC Link or ADNOC home delivery), and car maintenance (e.g. BP & Zippity, Daimler & RepairSmith). To access these innovations, fuel retailers need to build partnerships with players in the mobility and retail ecosystems, government authorities, and utilities. It is important to pivot wisely so that old and new can coexist.

Future-proof your stations

Fuel retailers face numerous challenges, including the energy transition, changing customer behavior and expectations, technological changes, and advanced mobility solutions. ICASA aims to help retailers make their service stations future-proof by guiding them through these changes and enabling them to evolve from energy suppliers to mobility providers. ICASA offers a secure and reliable cloud solution for optimizing and managing energy services and supporting the transition to a green mobility ecosystem.

>> Reach out to ICASA to reshape the fuel retail landscape together.