Most consumers patronize gas stations to fill up their tanks. But petroleum retailers know their highest margins are generated by inside sales and such onsite profit centers as car washes.
Pump toppers are proven means for advertising convenience store products and ancillary services. But in addition, TV programming on in-pump color monitors not only engages customers, but can yield measurable results. “Nielsen research proves that providing this for the consumer lifts c-store sales,” said CEO David Leider of Gas Station TV (GSTV) in Birmingham, Mich.
A Nielsen audit found GSTV reaches 27 million viewers per month in more than 100 markets, including 24 of the top 25. Another network, Outcast of Santa Monica, Calif., is seen by 23 million monthly viewers over more than 12,000 screens nationwide. And two years ago Outcast joined forces with PumpTop TV of Irvine, Calif., a network that reaches 20 million viewers on 10,000 screens in major markets from coast to coast.
National advertisers also endorse video marketing. Those on PumpTop TV, for example, have included American Express, Bank of America, Chevrolet, Pontiac, Saturn, Mobil 1, Delta, Best Buy, CVS Pharmacy, Carl’s Jr., Jack in the Box, Subway, Dunkin Donuts, Gatorade, Red Bull, Verizon, and Sony Pictures.
PepsiCo Inc. recently named Gas Station TV the winner of its Best Retail Marketing Campaign of the Year for 2010. “If you can drive a relevant message in a relative space, then it brings value to the consumer,” said Tricia Nichols, media portfolio projects lead at PepsiCo Inc. and group media director at the TracyLocke marketing agency. “We can help consumers understand where our products fit into their lives, which leads to a compelling reason to purchase our products.”
Dispenser manufacturers are also on board with in-pump video options. Mark Williams, marketing manager of dispenser applications at Gilbarco Veeder-Root in Greensboro, N.C., said his company recently partnered with Outcast to create interactive merchandising at the pump for its Applause Media System. Launched last fall, Applause™ TV combines advertising, news, and entertainment with on-demand coupon printing.
“For an average retailer,” said Williams, “only a third of customers go into the store. But today, you’re fighting more than just the c-store down the street. The same products you sell may be offered at multiple competitors. So there’s a need for engaging point-of-sale marketing that gets the customer inside your store.”
The same need is recognized by dispenser manufacturer Dresser Wayne of Austin, Tex. “More than half of fuel customers never leave the forecourt to shop inside the store,” said D.P. Rabalais, global marketing communications manager. The company’s iXT Media digital merchandising system, he added, “increases sales and builds brand loyalty by harnessing the power of multimedia marketing at the dispenser.”
Proof in Numbers
To measure the value of television monitors at the pump for both retailer and advertiser, Gas Station TV was independently audited by Nielsen Media Research. According to Leider, 93 percent of consumers surveyed preferred gas stations with GSTV, some 83 percent “thought it was a good thing for retailers to provide,” and stations with GSTV “had sales lifts of up to 78 percent.”
Similarly, Outcast and PumpTop TV reports research that indicates more than 90 percent of fuel customers notice their screens, more than 70 percent considered at-the-pump advertising a good source of product information, and 75 percent could recall at least advertisement. Outcast notes that customers are a captive audience—with no DVR to skip over ads—so that viewers spend an average 35 percent more on days they fuel their cars. Eighty-seven percent of those surveyed said they found the programming to be entertaining and plan to watch again on their next fueling visit.
A Nielsen study conducted from 2006 to 2008 for GSTV found that windshield washer fluid advertised on-screen had a sales lift of 42 percent and candy lifted 69 percent. Compared to c-stores without the pump video service, car washes saw a 78 percent sales, bottled water 60 percent, energy drinks 53 percent, and candy bars 15 percent. Similarly, research by PumpTop TV indicated that products featured on videos enjoyed an average sales lift of 13 to 42 percent per month.
The concept behind the content is simple—each TV segment is followed by a promotion. Outcast partners include CBS, CNET, HGTV, BBC, DIY Network, and TV Land. On PumpTop TV viewers can watch the NBA and MLB networks, FX, DIY, truTV, Better.TV, and other programmers. Gas Station TV offers custom-produced, exclusive, and constantly updated ESPN sports, NBCU news and entertainment, and market-specific AccuWeather forecasts.
“The key is that everyone loves television,” Leider said. “Compared to static advertising, TV’s blend of full sight, sound, and motion makes for greater impact and awareness.” Specific promotional schedules are tailored to each retailer. After the retailer and GSTV agree on the amount of advertising to be run for the year, he explained, “then we create monthly promotional calendars, as well as help create and design what the announcements will look like. Tying in our national advertisers also drives people into the c-store.”
Promotions can be also be used not only to push products but also to build a retailer’s brand. “Some clients have been very successful at this,” said Leider. “They might point out their cleanliness or outstanding service, or a charitable event in which they’re participating.”
Leider acknowledged that some fuel retailers may be skeptical. “With past systems that tried to transmit video content,” he said, “some providers weren’t able to deliver. Screens went dark after the networks failed.” Today, however, the in-pump video market has consolidated into three major players—Gas Station TV, Outcast, and PumpTop TV.
Installation time for GSTVs at a typical site is less than three hours. And since the technology is IT-based, programs are immediately up and running. “We maintain and monitor all televisions from our headquarters,” Leider said. “If a problem occurs, 95 percent of the work can be done remotely.”
National advertisers, suggested TracyLocke’s Tricia Nichols, can benefit from sponsoring promotions that increase brand sales—without taking money from retailers’ pockets. In 2010, for example, PepsiCo brands including Pepsi, AMP Energy drink, AMP Energy Juice, and Lipton Brisk were promoted to viewers via GSTV “just steps away from the products available inside the convenience store,” she said. By the same token, the PepsiCo ad campaign generated a 213 percent increase in awareness of end the AMP Energy brand, 277 percent rise in purchase intent, and 150 percent increase in individuals willing the drink to friends and family.
Marketing success hinges on crafting messages that target a specific audience or region, so that PepsiCo’s ability to target gas station customers played a key role in its AMP Energy campaign. “The needs of these customers are different than those for people who are hearing an ad on the radio, watching an ad on TV at home, or seeing an ad via online media,” said Nichols. “So we were able to craft an engaging and relevant message for people ‘on the go’ about the need for refreshment or hydration.”
At Gilbarco, Mark Williams pointed out, “There are TV network models that are purely third-party managed, while others are run by the retailer. But our Applause TV system is an interactive solution that combines both models. It’s a turn-key, but the retailer also has site-specific control.”
Interactivity is built into Applause TV because customers can choose and print coupons at the dispenser. “Since a coupon is an immediate call to action,” said Williams, “not only are you capturing customers’ attention, but the interactivity of printing coupons also means they become more invested in the experience—and more incentivized to make an immediate purchase.”
The Applause TV system allows retailers to produce their own promotional content. But because it also carries (at each retailer’s option) national advertisers, Williams added, “The coupons they sponsor benefit you because you aren’t paying for the discount.” In-pump TV is likewise effective for introducing new products “because you can reach all customers that visit your site, not just those that come into the store.”
At the same time, the Gilbarco solution allows retailers to do daypart and site-specific marketing. “The best retailers know what they’re good at and focus on that,” said Williams, “whether your key profit center might be your foodservice or your carwash.” In-pump TV can likewise be used for general promotion of a retailer’s own brand. “You can use it to differentiate yourself and tell your story—maybe that you use local products, or offer different types of fuel, or clean restrooms every hour, or that you’re environmentally conscious.”
Retailers who install Applause TV with Outcast will feature a programming loop that includes weather and entertainment from CBS, HGTV, VH1 and The Food Network, among others. The system does not require new fuel dispensers since it may be retrofitted on newer dispenser models. Since the screen is integrated into the dispenser then maintenance is the retailer’s responsibility, although Gilbarco centrally manages connectivity.
Payback for the upgrade can be swift. “Just a one percent lift in store and fuel sales would translate into payback of less than a year,” said Williams. “Even if fuel sales do not increase, a two percent lift of in-store sales would make ROI closer to six months.”
At Dresser Wayne, the company has also integrated screens into its Ovation dispensers. “The platform utilizes the screen at the center of the dispenser with soft keys that allow the user to interact,” said Tom Barrett, vice president of global service.
The design also allows for printing coupons at the pump. “By taking advantage of this feature,” Barrett said, “both national advertisers and local c-store owners get measurable results. Couponing also allows the user to tailor the experience. They can select their areas of interest and pick promotions based on them, thereby participating in the transaction. And we provide the tools to create your own promotions. If you’re familiar with PowerPoint, it’s easy.”
Though the screen is embedded, nearly all Ovation dispensers can be upgraded to color, said Dan Harrell, vice president of technology services. “The older models don’t have the space for the larger screens,” he explained, “but by and large, any Ovation dispenser manufactured since 2002 can be upgraded. And because we centrally manage connectivity, we can remotely troubleshoot if a screen isn’t operating properly.”
Cross-promotions are an obvious possibility for in-pump TV marketing and Dresser Wayne global marketing communications manager D. P. Rabalais said that top sellers at many locations are bottled water and energy drinks. But fuel retailers can get mileage “not just from ads for store products, but also from forecourt promotions,” he said. “You can generate bigger margins by having the consumer upgrade to a higher fuel grade or car wash.”
Though messages can be tailored by daypart and site, Harrell said, “You can also customize down to the dispenser level. So if you want to push a different message to your diesel customers, you have that option.”
Programmers, advertisers, and dispenser manufacturers that have committed to pump video services are being joined by fuel retailers large and small. Sunoco, after a two-year pilot of Gas Station TV, recently announced it would be rolling out the network to all its 4,700 stores.
Los-Angeles based United Oil features GSTV at 95 of its 130 locations, making creative use of its allotted TV time both for product promotions and corporate imaging. And in Anderson, Ind., Ricker Oil has piloted GSTV at four of 50 sites and in 2011 plans to introduce the service at ten or 15 more stores.
TV at the pump is, GSTV’s Leider believes, an effective way to address a problem that has bedeviled fuel retailers for a generation. “Pay-at-the-pump took away the need for people to come into the store,” he said. “But with in-pump TV you can make customers aware of services and products you provide in a way that benefits both you and the consumer.”