Shell Oil Retailing Strategy

1. Shell Case Study : Round 3
Ashish
Anand
Sanyal C Amey M

2. • India – one of the fastest growing
country in the World
• High demand for energy products
• Earlier only IOCL , BPCL and HPCL in
the market for selling transportation
fuels
• In 2002 private players allowed to
market transportation fuels
 Government Regulation:
• Govt. introduced Administered Pricing Mechanism in 1977 for pricing petroleum products
• Motive : Insulate the domestic economy from the high & volatile international oil prices
• Kirit Parikh report : Price of petrol has been decontrolled in June 2010
• Diesel still not decontrolled by the govt. owing large dependence of industry and
households on it
 Consumption Pattern:
 High Demand: Per capita consumption of Petrol and Diesel has doubled in the last decade
 High prices of petrol leading consumers to shift towards CNG and diesel automobiles
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

3. Petrol and Diesel Price-Pan India
80
75
Shell : Only dedicated oil marketing 70
company in India 65
60
• Involved in the marketing of petroleum 55
50
products 45
• Don't have a presence in the refining 40
Bangalore Chennai Pune Hyderabad
• 2000 licenses but operates only 62 Sites
NOC-Diesel Shell-Diesel
NOC-Petrol Shell-Petrol
2004 : Started operations in India
Fuels
Project Mayback : Selection of Sites
2008 : Concentration Principle Shell
Lubricants :
Shell
2009: Project Stela to divest some sites
SHELL-India Retail &
Business
Bitumen
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

4. Value Proposition of SHELL in India : Quality
and
• Quality fuel offering quantity
• Providing best in class infrastructure
• Stringent quality control & assurance of right quantity delivery
• Highly skilled service station workforce FUEL
World
Class
• Fuel Economy concept for efficient fuel utilization economy
Infra
• More focused on Passenger vehicles than commercial vehicles
Issues faced by NOC’s in India : Skilled
• Premium charged for quality fuel Workers
• Many reported instances of adulteration
• Infrastructure is not at par with private players BPCL 1 2012 : Adulteration stats
• Low skilled service station work force resulting in huge
waiting time for the consumers
IOC
• High crime rate at the filling station in rural areas
HPCL
• Total vehicle management is available at very select outlets
HPCL BPCL
even in Urban areas 28
• Operational inefficiency leading to frequent stock outs
• Calibration issues at the filling stations IOC 46
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

5.  Provide a branded value proposition Brand Promotion /Awareness:
 Campaign locally about the same price structure with
instead of offering fuel as a commodity better product offering
 Brand nomenclature :  Collaboration with leading manufacturers of vehicles
for after sales service
Fuel Brand Name
 Launch of SHELL mascot who will address various
Unleaded Petrol Mileage day to day issues of vehicles in ads
Premium Petrol Mileage Plus  Association with Hot Wheels allowing to have
SHELL logo on cars thus increasing brand familiarity
Diesel Shell Shakti
We know what's best for your vehicle :
 Campaign featuring various ads where user prefers
only expert care when it comes to any important
decision
 Think SHELL Think Happiness
 Your car needs the best care
 It also needs quality fuel
 Use transparent filling station machines (semiotics)
 And SHELL provides quality fuel
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

6. Brand Loyalty Promotion :
Involving Corporate Platform to Share Experiences
Generating First Trails
Consumers
• Collaborate with leading retail • Engage Govt. employees , large • Co-creation via Social CRM
stores/brand private players etc.
• Communication of new Products
• Issue membership cards on high • Online web portal for members via this medium
value purchases viz. INR1500
• Provide differentiated customer • Frequent polls to allow consumer
• Offer cash back on collection of service register their preferences
100 points viz. 5%
Consider
The Loyalty Loop
Evaluate
Bond Enjoy
Advocate Buy
Value Brand Retail Site The Final
Overview
Proposition Loyalty Opportunity Word

7. Creating Brand Equity through Sustainable Development
 Economic considerations
 Environmental considerations
• Inclusion of pre-fabricated buildings &
• Shell takes environmental impact
hydraulically lifted canopies at Retail Sites
seriously & addresses it properly
• Reducing the risks of working at height
• Protection of the soil & ground water
and there by additional costs
and environment surrounding the
• Reducing construction man- hours by
retail outlet
25%
 Social  CSR
• Diversity at work place; favourable • Engage in CSR activities to create
conditions for disabled persons & women Brand Awareness
• Support economically marginalized youth • Organise Marathons to create a sense
to take up entrepreneurship of Brand community
opportunities
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

8. Current Retailing Opportunities Mobile
App for
• Open small convenience stores Ordering
Groceries
• Develop & Provide Shell Apps for
ordering Grocery Online
• Collection while coming for fuel refilling
• Provide PUC(Pollution Under Control) Car
Wash
Services
• Provide Maintenance & Repair Services
Grocery
Long Term Retailing Opportunities Stores
• Partner with retailing majors as Wal-
Collaborate
Mart, Big Bazaar
with online
• Provide total vehicle management
Grih sewa
(Fuel, PUC, Maintenance services, Car
services
Wash Service)
• Provide small recreational centers for kids
for consumer involvement
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word

9. Summary Recommendations:
 Branding Fuel as Shell Mileage , Shell Mileage Plus and Shell
Shakti
 Launching Think Shell , Think Happiness Program for large scale
promotion
 Partnering with leading brands like Hot Wheels etc. for brand
recall
 Generate first trails through card launch programs and engage
social media
 Development of retail outlet with introduction of small
convenience store and providing basic maitainence facilities
Value Brand Retail Site The Final
Overview
Proposition Promotion Opportunity Word