Even though it's the non-fuel business that makes service stations profitable these days, most customers are still coming into the C-Store in the first place to pay for fuel. Their vehicles on the forecourt bring them in, and they still expect to find car care and automotive products on the shelves. Of course, fuel retailers know this and all service stations carry a basic range. However, the category definitely needs more attention and active marketing.
For a start, a service station is often the closest source of help in an emergency. Basic emergency items — fuses, petrol caps, funnels, fuel cans, leak stoppers, and the like — maintain strong sales. Customers in distress from a flat tyre will also be relieved to find Holts Tyreweld there as well.
"About one-in-four vehicles per year have a puncture, and often it happens out on the road" said Chris Goldrick, Managing Director, Holts–Honeywell. "Tyreweld is a 'get-you-home' tyre repair kit that is effectively a 'spare wheel in a can'."
Emergency items can also be sold as insurance products. For example, Tyreweld comes in a one-piece aluminium can that does not corrode and can be carried around in a car for years.
"We will be advertising this year," added Mr Goldrick. "We will be using the example of a family on holiday with a loaded car that gets a flat. Instead of taking all the gear out of the boot to get to the spare wheel then spending time changing the tyre, they take Tyreweld out of the boot and fix the tyre straight away."
Holts also supplies Screenies interior windscreen wipes. The car windscreen is another part of a vehicle that needs emergency and insurance products. Another innovation — DEMS Group's UfIXIT DIY Windscreen Repair Kit — is the only product on the market where one kit allows for multiple repairs of chips and cracks in repairable windscreens.
"This is new technology introduced into Australia in August last year," said Mark Smith, Director, DEMS Group Pty Ltd. "It is a permanent repair and will last the life of the windscreen."
UfIXIT is an emergency product for motorists who have just had an airborne stone take a chip out of their windscreen and are looking for something to repair it. Like the Tyreweld, it is also an insurance product to keep in the glove box for when windscreens get chips and cracks on the road.
"We estimate there are seven million vehicles with repairable damage to their windscreens," said Mr Smith. "We will be advertising on Channel 31 and 4WD TV, emphasising the fact that the sooner you do something about windscreen damage the better. The windscreen is one of the most important safety features of a car in the event of an accident."
Like Tyreweld, UfIXIT will last a long time — four years after first use — and the average repair takes less than 30 minutes. There up to five applications in the pack. Not only is the windscreen an important element of the vehicle's structure, its performance in wet weather is also important to vehicle safety. Although motorists should be thinking ahead, they tend to ignore the condition of wiper blades and windscreen wash water until the next drizzly day when they can't see past the grime and bugs. Bar's Bugs has been around a long time and, although appealing more to an older demographic, it sells itself.
"Sales of our windscreen cleaner have grown considerably in recent years," said Andrew Wade, National Sales Manager, Bar's Leaks. "It could be the drought and water restrictions."
Weather is definitely a factor, and service stations should stock products that support customers in adverse driving conditions.
"Tests by the University of Michigan had shown that Rain-X repellent in the windscreen wash water adds one second to driver reaction time," said Warren Searle, National Account Manager, Shell Car Care International (SCCI). "That's equivalent to nearly 30 metres at 100 kph. We call it the 'one second advantage'."
This will be the theme of SCCI's advertising in motoring magazines this year. Rain-X comes in bottles and packs of wipes. SCCI is also launching a two-in-one glass cleaner (repellent and anti-fog) this year.
"Drivers are using more windscreen cleaning products because of the drought," added Peter Avenell, Sales & Marketing Manager, Trico Products. "For a start, the dry weather means there are more bugs in the air and more build up of grime. Then, when it does rain, the wiper blades have deteriorated in the dry heat. The more often they are wet the longer they last."
In fact, wiper blades should be changed every 18 months but they rarely are. They are, in effect, an emergency product because motorists don't think about them till they have to. Trico advertises its windscreen products in Wheels and the automobile association magazines.
"All service stations need to stock multi-fit blade refills, but increasingly they will need to stock 'beam' blades," said Mr Avenell.
A beam blade is a one-piece blade on a tension bar that applies equal pressure along the blade. Beam blades are being fitted to some new cars, including the VE Commodore.
Aunger Group also offers a range of blades and refills, including colourful silicone blades, all 24-inch cut to size and multi-fit to suit 6mm and 8mm. "This program takes away the guess work for those customers that are not sure which width they need," said Marketing Manager James Brown. "We have also recently added the 28-inch rubber refills in multi-fit backing for the growing number of cars with a longer driver's side wiper."
Fuel retailers need to keep in mind that all customers (not just those in distress) are in the store because of their vehicles. Motorists are not just concerned about having a full tank; they are also concerned about vehicle appearance and performance.
Although the era of DIY (do-it-yourself) has largely given way to DIFM (do-it-for-me), motorists still want some involvement with their vehicles. They will do simple maintenance and enhancement tasks, creating an opportunity for service stations to offer relevant top-up products such as oil, coolant, and brake, power steering and auto transmission fluids.
"Coolants are the second most widely used fluid in a vehicle (after engine oil)," said Mr Goldrick. "Yet, they are often overlooked in C-Stores. A good-quality glycol-based universal coolant, such as Prestone Extended Life, that can be used in all makes and models and can be mixed with other coolants is ideal for service stations."
Nulon Products Australia's National Accounts Manager Robert Marshman agrees. "Many C-Stores are missing the opportunity to upsell to the types of coolants (such as Nulon Long Life Coolant) now required by the majority of cars on Australian roads," he said. "Organic coolants are also gaining in popularity."
At the other end of the weather spectrum, Nulon's Start Ya Bastard will get diesel engines going on a cold day.
Motorists need all sorts of gadgets, such as tie downs, ocky straps, 'L' and 'P' plate holders, battery booster cables, snatch straps and shackles, and all of these and more are available from Aunger Group, a car care and automotive supplier on the acquisition trail. James Brown said Aunger is looking to build a stable of leading automotive brands, such as the recently acquired Kenco Car Care. Of particular interest to service stations is Kenco's range of chamois, sponges and microfibre cloths in flexible space-saving packaging.
"The microfibre range is growing strongly, in particular products that use little or no water," said Mr Brown. "Our innovative microfibre products appeal to people who still want to maintain their cars but are constrained by water restrictions. In response to consumer needs, we recently introduced a 'giant' colour-coded cloth range with embroidered marks so that they remember which cloth to use for which task. That way they don't get mixed up and end up putting cutting compound or polish on glass, a common complaint with using unmarked cloths."
Waterless cleaning presents a challenge for motorists who, in the past, have been concerned about scratching surfaces. In 2007 Selleys launched Polyglaze Waterless Wash with a 'no scratch' formulation.
"Consumer concerns are slowly being overcome as they become more confident in the waterless product range," said Polyglaze Brand Manager Colin Chang. "We have encouraged people to try it with demonstrations at motor shows and the like, and sales are growing well."
So well that Polyglaze is extending its waterless range to include Waterless Wash and Wax.
"People are also looking for a shine on their car when they clean it," said Mr Chang. "The launch will be for the Spring–Summer season, with further extensions later in the year."
Applied Australia's Divisional Manager–Consumer Products Paul Shnider noted that detailing products are also selling well.
"Keen vehicle owners are looking for products such as tyre sheens, wheel cleaners, interior cleaners and protectants because they still want to take care of their cars," he said. "This presents an opportunity for service stations, particularly those with (or near) a commercial car wash.
Applied Australia's broad Chemtech vehicle care and protection range includes the fuel additives Petrol Power and Diesel Power.
"The market for additives is growing with changing vehicle technology and the high price of fuel," said Mr Shnider. "There is no doubt that consumers are becoming aware of the benefits of using additives to maintain engines, deliver more power, and stretch each tank of fuel to get more bang for their bucks."
2008 is shaping up as a busy year for Chemtech, with the release of a new Diesel Power formula in June and a new Petrol Power formula later in the year.
"These formulas use new technology for better performance, reduced emissions, improved fuel economy, and better fuel stability in storage," added Mr Shnider.
In the meantime, the entire Chemtech range is getting a facelift, with new bottles and labels. To be launched at Forecourt 2008, the new look will be supported by a marketing campaign including print advertising and product giveaways.
"We will be sending a strong message to the consumer that Chemtech is a no-nonsense product that does the job," said Mr Shnider. "Swing tags and other in-store promotional material will help C-Stores promote the range."
Nulon Products Australia fields many calls from consumers, and there has been a definite increase in the number of callers looking for ways to improve fuel economy.
"Both Petrol Injector Cleaner and Total Fuel System Cleaner are seeing strong sales," said Mr Marshman. "Both give excellent cleaning results and, in older cars, the improvement in fuel economy can be dramatic."
According to Flashlube, independent tests show up to 6.5% better fuel economy with fuel additives such as its Injector Cleaner and Diesel Fuel Conditioner through cleaner fuel lines and complete combustion. While fuel system cleaners are doing well, sales of lead substitutes are on the decline. That being said, it is still important to motorists with vehicles susceptible to valve seat recession.
"Only about 2% of the vehicles on the road need a leaded fuel equivalent," said Brent Hutchinson, Marketing Manager, Flashlube. "However, more and more motorists are converting to LPG, and Flashlube is the only valve saver fluid that comes in a kit made for LPG fuel systems. Converted cars need Flashlube because the gas burns hotter and drier than petrol, and the valves in petrol combustion engines are not built to take the heat."
One product that can 'take the heat' is WD-40. A versatile product — 2,000 uses as listed on the website — WD-40 has many automotive uses, including loosening wheel nuts (handy when you do have to change a tyre), oiling antennas for smooth operating, removing insects from the grille, and shining chrome.
"Our current campaign is Did you know?" said Stephanie Barry, General Manager, WD-40. "Further to the five key uses listed on the cans (stops squeaks, drives out moisture, cleans and protects, loosens rusty parts and frees sticky mechanisms) we are providing our customers with information about uses of WD-40 relevant to the size of the can and its target market. This is achieved with a strip along the top of the can and we plan to rotate these to educate our customers of more uses of WD-40 and encourage them to go to our website to learn even more. We also advertise in the automotive magazines that are sold through major service stations.
"In our experience, WD-40 sells itself and users tend to have more than one can at home and in the car. It is recession-proof, selling well in good times and not so good times. WD-40 has such strong consumer awareness that it brings credibility to the products around it."
Car care and automotive product suppliers are realists. They don't expect to their products will ever displace confectionery and other high turnover items set out along the path from forecourt to the console. However, they have some good ideas on how to earn a lot more profit with a little more attention to the category.
First, retailers need a product mix to match their customer base and demographic.
"Every service station is a little bit different," said Andrew Wade. "It is clear from our data that service station sales increase when we put the right products in the right area at the right time."
Nulon's Robert Marshman agrees. "Injector cleaning additives, for example, are particularly effective in vehicles that get stored for periods of time, such as boats and motorcycles. So, think about your customers and their automotive needs."
The range should also reflect the other facilities on site, such as workshop and car wash.
"Fuel retailers with a car wash can upsell related products," said Peter Avenell. "Don't just hand over the token; ask them if they need wiper blades, windscreen wash additives, detailing products, air fresheners, and the like. You could even offer discounts on some items just for these customers."
In general, discounts off shelf price are not effective promotions in this category. On the contrary, the category is very profitable in service stations because they can price higher than the auto specialist stores, generating margins of at least 40%. That being said, it doesn't pay to be too greedy, particularly if you want customers to come back.
"Customers will accept about 10% more on a $10 product for the convenience, but will be unhappy if they have to pay 30% more," added Mr Marshman. "Other than for emergency items, they have opportunities to shop elsewhere."
There is not much point having the right range at the right price if customers don't know about it. Yet, they are in the right frame of mind for subtle reminders. These days, they are probably bemoaning the price of fuel and/or thinking about the drought. Their cars are just outside and they are in 'driving' mode.
You could start with a pump crowner, especially for fuel additives and emphasising improved fuel economy and dollars to be saved. The same message could be reinforced at the counter.
"These products should be placed right in front of customers with a big sign saying 'Buy me now and save'," said Robert Marshman.
Flashlube's Brent Hutchinson agrees. "It's simply a matter of educating customers by informing them of the benefits of a fuel additive," he said.
To reinforce this message at the counter, suppliers have put together display units of small packs. For example, a counter or hang-sell unit of Flashlube 50 ml one-shot bottles sells for $3 each, with $1 going to the retailer; and Trico's 50 ml windscreen wash additive comes in a counter stand of 25. These units not only grab impulse sales but also remind customers of other car care and automotive needs. Also consider bringing other products forward to remind customers of the range; for example, windscreen products on a wet day. These placements provide an opportunity to talk to customers.
"In particular, C-Stores could more actively market to female motorists," said Chris Goldrick. "They should be encouraged to check oil and coolant levels and to consider other products in the range that will improve their driving experience."
Customers can also be attracted into the area with colourful displays. WD-40 offers a wing display units for its 150g can.
"The 150g and 255g cans are ideal for C-Stores," said Stephanie Barry. "I have seen some very creative displays that draw people into the area. Include our flyers that show the many automotive uses of WD-40. These are available upon request from the WD-40 Company. Consider highlighting one of the funnier ones to get their attention."
"It is important to grab the customer's attention at the door," added James Brown. "Colourful POS signs and information-rich packaging are our best means of capturing that attention and converting to sales. Kenco has been a strong supporter of the National Breast Cancer Foundation and have available a colourful (pink) display stand that is very eye-catching — a must in October."
So, with the right range at the right price in the right place, make sure customers have an easy time in choosing their products.
"Carrying too many of the same type of product is confusing," said Andrew Wade. "People want to find what they want quickly. If they want a lot of choice they will go to an auto specialist store."
Colour can also be used to good effect on shelf. Chemtech's new packaging has been created with the C-Store in mind.
"The new bottles and labels create a strong look on the shelf," said Paul Shnider. "Our marketing team is keen to help retailers create offers and tailor marketing material for their stores."
Retailers can also put together their own offers such as bundling a windscreen wash additive with wiper blades or an air freshener with a fuel additive. Air fresheners will be the forecourt topic in November/December issue of Australian Convenience Store News.