Asset: Why Covid-19 is Driving Innovation in Gas Stations

Blog Post | May 16, 2020

Why Covid-19 is Driving Innovation in Gas Stations
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Shelter-in-place orders have dramatically reduced gasoline demand in the US. In fact, sales during the final week of March were nearly 47% below the same period the previous year, with the demand drop-off exceeding 50% in some regions. Looking ahead, gasoline sales are predicted to remain far below their “pre-COVID” level for at least another year, as people stay closer to home.

Luckily for gas station owners, the drop in consumer demand happened at the same time that oil prices collapsed. (It almost feels like divine intervention!) Today, the average US retail station’s fuel earnings are actually higher than they were before COVID-19, if you can believe it.

Unfortunately, gas station owners are feeling the pain of the pandemic in other ways. Fewer people at the pump means fewer people inside the stores. Whereas the average margin for fuel is between 5% to 9%, the average margin for drinks and snacks is more than 30%. To survive the pandemic, gas stations will need to focus on their non-fuel offerings and ensure that stores are clean and inviting. Some stores might even see a boost if stopping in to grab milk and a snack at a smaller store is perceived, by customers, to be a safer, easier option than visiting a grocery store.

But for many c-stores, it will take some work to understand new government regulations and get stores compliant. For example, in addition to getting staff to wash their hands regularly, they will need to sanitize high-touch areas and make hand sanitizer stations available for customers and staff. According to NACS, many c-stores are “suspending the use of refillable tumblers and mugs, eliminating food and beverage samples, considering limiting certain food service operations and expanding delivery services, including pump-side delivery.”

While operational changes are easy to list out on your website, driving in-store execution is a big challenge, especially if you have multiple stores with hourly employees. How do you get the message out to every single associate and ensure that it’s heard? If you’re like most c-stores, you’re using multiple channels to reach them, but somehow your messages aren’t making it all the way down to the stores and execution is still suffering.

In fact, only 29% of direction sent to stores is executed correctly by store teams. This means that marketers, merchandisers and comms teams are wasting thousands of hours each year planning for campaigns and programs that will never be effective. It also means that retail brands can’t be agile and turn on a dime. 

The most agile retailers empower their store teams with effective communication that is organized, received and understood in an actionable way. They educate teams about why something is being asked of them and provide context to the work so it’s just not a single action, but rather one step that’s part of a larger brand vision or initiative. 

In many cases, your managers are young and lack extensive business experience or education so providing context helps guide prioritization and enables the store teams to be better guardians of their business. These managers are sizable businesses and they’re making day to day decisions that impact brand perception and comp (comparable store sales) sales. HQ has the power, through communication, to make them better leaders and stewards of the business.

How does Zipline help? We make communications and task management software that enables retail brands to coordinate their brick-and-mortar stores. We know that many c-stores still rely on email or or use clunky, outdated software to run their stores. As a result, associates and managers wind up overwhelmed, with too much information in too many places. They complain that they can’t get stuff done. 

Zipline makes it really easy to target and personalize comms so that everyone, at each level of the organization, only sees information that applies to them and everyone gets to track execution. Zipline also shows them what good looks like, with newsletter-like quality. HQ can show, not tell, through videos, pictures, multimedia etc. As a result, everyone saves time, employees know what’s expected of them and can succeed in their jobs and businesses become more agile. 

If you’re looking for ways to make your gas stations and c-stores more agile, please reach out. We would love to discuss how Zipline can help.

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