The fuel industry is going through a period of accelerated change. Customer demands are evolving, and profit centers are shifting. While some of these changes can feel unsettling, they also open new doors for savvy retailers to win new customers and increase profit.  

Simply put, to capitalize on these changes, fuel retailers need to look beyond fuel. 

In this article, we’ve mapped the developing trends in fuel retailing with actionable solutions to make your business an attractive location for today’s (and tomorrow’s) customers.

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What trends are shaping the future of the fuel industry?

Three major factors are disrupting the traditional fuel retail industry:

1. Declining demand for fuel
2. Growing digital engagement 
3. Rise of the convenience shopper
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A declining demand for fuel

Long-term trends - such as advances in alternative fuel technologies, carbon-free regulations, and new vehicle emissions standards - present a challenging picture for retail fuel demand. And recent developments - such as the Covid pandemic - are only hastening these changes.

Electric vehicle popularity continues to rise among both individual and commercial users. An expanding nationwide network of charging stations have made it simpler for the average driver to make the switch to electric. Meanwhile, corporate giants like Amazon trailblaze greener initiatives by drastically reducing carbon emissions with electronic delivery vans. 

Not to mention, a significant portion of the workforce now works from home - and may not be returning to the office and typical commuting patterns anytime soon.

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A rising demand for digital connectivity

Between avoiding exposure to illness and an on-the-go mentality, consumers want digital solutions to help them find and buy what they’re looking for - even in fuel retailing. 
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That means contactless payments, self-serve kiosks, multipurpose digital screens, and app-based solutions. Take ExxonMobil, for example, who developed Speedpass+ to facilitate payment processes for their customers. Services like these will all soon be industry-standard.

Consumers want fuel retailers to create room for safety and comfort while they’re shopping. Digitization covers one end of that spectrum by facilitating a fast and smooth customer experience. Digital channels also create opportunities for retailers to foster a 1:1 relationship with their customers, serving personalized promotions or recommendations for new products or services that the customer might like based on a retailer’s understanding of their past behavior.
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Convenience above all else

As consumers look to socially distance during Covid, stay local, and lessen their environmental impact, we’re seeing a new trend emerge: trip consolidation. Today’s shopper wants to do as much as possible in one place in the least amount of time. 

E-vehicle owners want a charging station. Covid-wary shoppers want a one-stop location for all their essentials. Work-from-home employees want a nearby option for fresh and easy dine-in or pick-up. 

Once again, opportunity presents itself for savvy fuel retailers who can capitalize on these emerging trends.

How fuel retailers can compensate for declining demand

So what do all these shifts in market dynamics and consumer preferences mean for fuel retailers? Well, according to a report by McKinsey and Company, fuel retailers now have the opportunity to move into a number of new potential profit centers to expand beyond fuel.

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Such adjacent value pools focus on your customer’s evolving needs – be it sustainability, convenience, selection, or trip consolidation. Here’s how you can pivot today, innovate for tomorrow, and invest in your future.

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Future-proof by welcoming new fuel customers

The market is opening up for new and alternate fuels. Specifically, a new customer base is booming for electric vehicles.  

Electric vehicles are becoming a core part of the transportation future. According to McKinsey and Company, the electric vehicle adjacent value pool is expected to rise to a worth of $20 billion by 2030. Safeguard the future of your business by investing in structural changes that convenience EV customers, like charging stations. 

For many fuel retailers, EV charging is still a far-out investment; in the nearer term, however, you can still look for ways to serve EV customers’ non-charging needs. Consider integrating non-fuel retail services that can be done while they wait for their cars to charge. 

You can opt for non-fuel retail services like: 

• Car care (washing, vacuuming, and servicing) 
• Quick-service restaurants
• Traveler hospitalities (think clean restrooms, free wifi)
• Drive-through services 
  

Services like these will attract potential customers of all types, regardless of their fueling needs. Plus, if you already have these services, you can highlight them in your customer acquisition strategies.

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Innovate your fuel store with hyperlocal on-the-go services

Make your fuel store a hub for customer activity by adding mobile services. Here are a few ideas on how to attract a diverse crowd of customers who aren’t looking for fuel or car services:

• ATM and banking options
• Pharmacy drop-off and pick-up center
• Postal and parcel kiosk
  

Fortunately, these services can be operated and managed largely through digital tools. They also require very little change to the structure of your business real estate. 

To further improve the activity surrounding your business, consider stocking your shelves with food and drink items that will encourage customers to do more of their meal & grocery shopping with you. Consumers are looking to buy fresh and easy foods close to home. This means more frequent, local shopping trips and more ready-to-eat options.  

Food, necessities, and one-stop errands are a fast and easy way towards differentiating your business from nearby competitors. Raise the level of activity in your business by making your store the local option that has everything a customer needs.

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Leverage the data you already have to maximize customer value

The last - but potential most impactful - strategy you can embark on to better understand your shoppers. In this scenario, data is your best friend. 

If you want to serve customers in the most effective manner possible, you need to innovate your operations with a data-driven approach. Use consumer data to analyze buyer behavior and gain insights into customer experience. 

This kind of data lends key insights into what kind of goods & services shoppers are looking for, and can be leveraged to create intelligent promotions, rewards, or cash-back offers that ensure customers choose your store over your competitors.

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Innovation in fuel retail: A proven, seamless approach

For a fast, reliable, and plug-and-go solution to keep your business at the forefront of innovation, choose Upside. Upside leverages the data you already have (anonymized credit & debit transaction data) to develop personalized promotions that bring you new customers and profit. 

Upside simplifies the customer experience by meeting customers where they already are. Unlike in-store apps and loyalty programs, Upside helps you meet new customers in apps they already use–like Uber, Lyft, GasBuddy, and Checkout 51–and drive them to your store.

Plus, our mobile-first platform is unearthing countless opportunities for regional c-stores, like Huck’s, to capture more market share from grocery as they expand into non-fuel retail services.

And if you’re a fuel retailer looking to advertise your electric charging stations, the Upside app takes care of that, too–by putting those services in front of hundreds of thousands of people who are on the road and in your area.

Conclusion

Even as market dynamics shift, fuel retailing continues to present a promising opportunity for savvy operators to grow a profitable business and win loyal customers. To keep up in this changing market and earn more new profit, simply partner with Upside.

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Get started with Upside