Fuel retailers face razor-thin margins in their industry. For decades, successful retailers had a tested strategy to continue growing their businesses: simply build more sites and fill them with customers. But today, American fuel demand is down 4% from its 2018 peak, and it’s not expected to increase. Same-store sales are stagnating thanks to an increase in cross-shopping and the prevalence of fuel-efficient or electric vehicles. 

In short, the old playbook isn’t delivering the same return it used to. 

Though fuel demand has been declining, opportunities still exist. Even in the face of unfavorable market dynamics, you can find ways to grow in fuel that don’t require you to expand your footprint. It’s just about making the best use of the resources you already have.

What is capacity utilization, and why does it matter?

The key to growth without expansion lies in capacity utilization, which measures how much of your store’s transaction potential you’re actually capturing. 

Every fuel retailer has spare capacity — empty fuel pumps, vacant c-store aisles, idle employees. In fact, during standard business hours, the average station’s pumps are only being utilized at 24% capacity. 

During peak hours, utilization jumps to 41%, but that still means that pumps are idle between 59% and 76% of the time. Practicing capacity utilization places the emphasis on making the most of those resources.  

Any retailer can optimize their spare capacity — think of airlines with empty seats on their flights. It obviously benefits the airline to fill as many spots as possible on its flights, because once a flight takes off with empty seats, the associated revenue is lost forever. Capturing that revenue doesn’t require any new infrastructure or expenses, just more optimal use of existing resources.

Strategies to improve capacity utilization

Rather than waiting for customers to choose your location, proactive strategies can drive incremental gallons and revenue. That means focusing not just on bottom-of-funnel (BOFU) tactics — like relying on customers who are already nearby, seeing your fuel sign price, or being nudged at the pump with a breakfast sandwich promotion — but also investing more at the top of the funnel (TOFU).

Top-of-funnel strategies aim to build brand awareness and preference before a customer even needs gas. It’s about making sure your brand is on their mind long before they're pulling into a station. Here are three strategies about how you can attract more people into your orbit and make better use of the assets you already have.

Strengthen your brand presence

If you don’t already have a brand identity, it’s time to build one. This doesn’t mean expensive advertising campaigns, but it does mean defining what makes your store unique and making sure customers recognize it.

Ask yourself what sets your station apart from local competitors. Is it high-quality hot food or other specialty items that customers can find in your c-stores? Are you known for great service or a unique in-store experience?

Whatever it is, lean into that differentiation. Make it a core part of your identity, including any customer-facing messaging.

Invest in community and partnerships

Another way to build brand equity is through strategic partnerships, especially those that create meaningful connections in your community.

What could that look like for your business? It might mean sponsoring a local sports team, a community event, or another cause that people in your region care about. It could also mean using local influencers or trusted figures to amplify your message.

By aligning with something people care about, you increase brand awareness without competing purely on price.

Expand your digital reach at the top of the funnel

Nearly every retailer has a loyalty program, which is a smart decision. Loyalty programs are effective at keeping existing customers engaged. But that’s the thing: Loyalty programs are tools to communicate with existing customers, whereas they aren’t nearly as effective at reaching new ones. In order to do that, you need to meet consumers where they are — on their phones and on the go. 

Instead of simply relying on customers to drive past your station and see your sign at the side of the road, think about other digital strategies to collapse that distance between you and potential customers. 

• Location-based promotions: Target people near your locations with a compelling reason to stop in.

• Mobile marketing and push notifications: Keep your brand top-of-mind when customers decide where to fuel up or make a quick c-store stop.

• Social media engagement: Get active on social to highlight in-store promotions, brand perks, or other unique offerings to spark interest and influence more foot traffic.

• Digital marketplaces: These platforms can connect you with new, high-intent fuel customers that you aren’t reaching otherwise. Upside, for example, helps retailers win more visits and greater spend from new and uncommitted customers. The result is better capacity management — filling those idle pumps when there are no customers using them otherwise.

Your next customer is out there — give them a reason to choose you 

Capacity utilization is a fundamentally different way to think about your business. But when fuel retailers get more out of their most expensive assets — namely, their land and equipment — the numbers speak for themselves.

‍Want to learn more about capacity utilization? Upside and SG Voices recently co-hosted a webinar on the topic — click here to watch the recording.