laeeq qureshi's dissertation

8/7/2019 Laeeq Qureshi's dissertation

http://slidepdf.com/reader/full/laeeq-qureshis-dissertation 1/111

What are the impacts of different brand development

strategies on customer based brand loyalty in the presence

of low price alternative Brands? A study of retail petroleumindustry of UK

A Dissertation

Submitted to

University of Wales Institute, Cardiff

By

Laeeq ud din Qureshi

UWIC S. ID: ST09006108

College ID: 0544BABA0409

As part requirement for the Completion of

Masters of Business Administration [MBA]

Programme

April 2010



P a g e | ii

DECLARATION

This work is being submitted in partial fulfilment of the requirements for the degree of

MBA (International Business) and has not previously been accepted in substance for any

degree and is not being concurrently submitted in candidature for any degree.

Signed ...................................................................... (candidate)Date: 01-04-2010

STATEMENT 1

This dissertation is the result of my own work and investigations, except where otherwise

stated. Where correction services have been used, the extent and nature of the correction is

clearly marked in a footnote(s).

Other sources are acknowledged by footnotes giving explicit references. A bibliography is

appended.

Signed ..................................................................... (candidate)

Date: 01-04-2010

Either STATEMENT 2(i)

I hereby give consent for my dissertation, if accepted, to be available for photocopying and

for inter- library loan, for deposit in UWIC‟s e-Repository, and that the title and summary

may be available to outside organisations.

Signed ..................................................................... (candidate)Date: 01-04-2010

Or STATEMENT 2(ii)

I hereby give consent for my dissertation, if accepted, to be available for photocopying and

for inter- library loans, and for deposit in UWIC‟s e-Repository after expiry of a bar on

access approved by UWIC.

Signed ..................................................................... (candidate)Date: 01-04-2010



P a g e | iii

Declaration

I, Mr. Laeeq ud din Qureshi, do hereby declare that this

dissertation is entirely my own composition. All references

made to work of other persons have been duly

acknowledged.

Laeeq ud din Qureshi

UWIC Student ID: ST09006108

1st April, 2010



P a g e | iv

Acknowledgement

Most primarily, I would like to thanks to almighty ALLAH for his countless blessing and

providing me the courage, inspiration, passion, emotion and devotion to complete this

dissertation a one step ahead to my professional life.

I would like to express the deepest appreciation to my supervisor, MR. Stephen Malone,

who has the attitude and the substance of a genius: he continually and convincingly

conveyed a spirit of adventure in regard to research and an excitement in regard to

teaching. Without his guidance and persistent help this dissertation would not have been

possible.

This dissertation is dedicated to my parents. My father MR. Iftikhar ud din qureshi (late)

he is the one who given me inspiration and courage to complete my MBA after several

years discontinuation of my study. He sent me to London for my MBA and after just 18

days he died. I always have been missing my father during my study and at this movement

when I complete my education, missing him most. The all intellectual asset I m having is

inspired by my father. My Mother, her day and night‟s prayers, vanish all the difficulties

which I had to achieve this goal.

Also my brother Aatiq ud din qureshi. I always been inspired by his boldness his business,

as well as I am very thankful to him about all of his courage and support. My both sisters

all always been really supportive for me in my whole stay in London, their love never let

me feel that I am far from my family. Love all of my family very much.

I would also like express my warm and heartfelt feelings to my friends Tasneem Nazar and

Raja ishaq as they always been really helpful and encouraging to me. Raja Babur, his

continuous guiding and good advisees have been essential part of this dissertation. Here i



P a g e | v

would also like to mention my back home friends Abdul basit and Aasif Aalimgir , both of

them always been very supportive and encouraging for me.

Actually, one of the greatest opportunities that this dissertation has offered me was to have

the chance to think several people whose encouragement and support over the years has

made me the person I am today. The faith, hope, trust and inspiration that have guided me

are the greatest richest of all. This dissertation challenge truly represents a lot of lesson

that I have learnt as I go through the journey of my life.

And so to everyone I have ever met, spoken to, worked with or even read from, I say very

big thank you to all of you. Learning from both my success and failures has made me

exactly what I am today. My success so far is driven by my unique personality and the

special circumstances that I happen to find myself in.

And finally, thank you to everyone, in every place who has helped me in one way or the

other. Thank you again and may God bless you all.



P a g e | vi

Abstract

This dissertation is explores the impacts of different brand developing strategies on

consumer-based brand loyalty. The retail petroleum industry is chosen to find out the

research question. Oil companies are doing retail operation in UK from long time. After

1990 supermarket started business in retail petroleum industry to provide its customer, a

convenient and better value for their money as supermarkets are marketing their fuels on

low price than oil companies. Supermarkets aggressive expansion in retail petroleum

industry made oil companies very conscious about their customer-based brand loyalty.

Oil companies are using different brand development strategies to make their brand

significant from other brands or products as well as to gain competitive advantages and

maintain customer-based brand loyalty. Strong brand and brand development strategies

provoke greater attraction to customer and having positive impacts on customer based

brand loyalty.

Supermarkets are providing real convenience to its fuel customers and providing good

quality of fuels even on low price than oil companies. Global companies and global brands

having some competitive advantages compare than local or small brands. In the respect of

retail petroleum industry in UK, only brand name and brand development strategies are not

enough to keep customer loyal to brand or products, while some other factors such as

convenience, price, and perceived brand value could affect customer based brand loyalty.

Oil companies should have to re -organise their brand development strategies in respect

of gain and maintain customer based brand loyalty. Convenience and easy approach to

filling stations as well as competitive price should be focal point for any oil company to

keep itself, called as “market leader” in market. As primary research and theory argues

that loyal customers are most valuable asset for any organization.



P a g e | vii

Table of Contents

Chapter 1 Introduction

1.0 Background of the study ....................................................................... 1

1.1 Overview of Retail Petroleum Industry and Development ...................... 2

1.2 Research Aims ...................................................................................... 5

1.3 The objectives of this study are: ............................................................ 5

1.4 Research Questions .............................................................................. 6

1.5 Rationale of the Study ........................................................................... 6

1.6 Scope of the Study ................................................................................ 7

2.0 Introductions ........................................................................................ 8

2.1 Short History of Branding ...................................................................... 8

2.2 Brand Importance ................................................................................. 9

2.3 Brand Development ............................................................................ 11

2.4 Key characteristics of a brand .............................................................. 12

2.5 Different Brand Types ......................................................................... 13

2.5.1 Retailer and Wholesaler Brands................................................................................... 14

2.5.2 Low priced Retailer‟s own Brands ............................................................................... 15

2.5.3 Generic Brands .......................................................................................................... 15

2.6 Brand Loyalty ...................................................................................... 16

2.6.1 Retention of Brand‟s Loyal Consumer ......................................................................... 17

2.6.2 Brand Emotional Loyalty ............................................................................................ 18

2.6.4 Brand Equity in Recession .......................................................................................... 20

2.6.5 Generic Brands and Brand Loyalty .............................................................................. 20

2.7 The corporate brand image ................................................................. 21

2.7.1 Affects of “Responsible Company Image” in Petroleum industry ................................... 21

2.8 Brand development strategies............................................................. 22

2.8.1 Brand Transformation................................................................................................. 22

2.8.2 Brand Segmentation ................................................................................................... 24



P a g e | viii

2.9 Price Sensitivity................................................................................... 24

2.9.1 Price Sensitive Customer ............................................................................................ 24

2.10 Recession Affects on Brand ............................................................... 25

2.10.1 Generic Brands in Recession ..................................................................................... 25

2.10.2 Affects of Current Economic Slump .......................................................................... 25

2.11Consumer Buying Behaviour............................................................... 26

Source taken from Marketing Management (Kotler. 2005)......................... 28

2.11.1 Understanding Brand Affects on Consumer Behaviour................................................ 28

2.11.2 Consumer Buying Behaviour in Recession ................................................................. 29

2.12 Summary .......................................................................................... 30

3.0 Introduction ....................................................................................... 31

3.1 Research Process ................................................................................ 31

3.1.1 Problem Definition ..................................................................................................... 32

3.1.2 Research Question...................................................................................................... 33

3.1.3 Research Purpose ....................................................................................................... 33

3.1.4 Research Objectives ................................................................................................... 33

3.1.5 Research Method........................................................................................................ 34

3.1.6 Research Design......................................................................................................... 34

3.2 Research Approach ............................................................................. 36

3.2.1 Qualitative Research Approach ................................................................................... 36

3.2.2 Triangulation Approach .............................................................................................. 37

3.3.1 Sample Population...................................................................................................... 39

3.3.2 Selection of Sample .................................................................................................... 39

3.3.2.1 Secondary Data.................................................................................................... 40

3.3.2.2 Primary Data ....................................................................................................... 40

3.3.3 Sample Techniques..................................................................................................... 41

3.3.4 Semi Structured Interview........................................................................................... 41

3.3.5 Observations .............................................................................................................. 41

3.3.6 Expert Opinion........................................................................................................... 41

3.4 Overview of Qualitative Analysis ......................................................... 41

3.4.1 Qualitative Analysis Using Grounded Theory ............................................................... 42



P a g e | ix

3.4.2 Qualitative Data Analysis by using Software ................................................................ 42

3.5 Research limitation ............................................................................. 43

3.6 Summary ............................................................................................ 43

4.0 Introduction ....................................................................................... 44

4.2 findings from Interviews and Expert Opinion ....................................... 45

4.2.1 Importance of Brand Loyal Costumers ......................................................................... 45

4.2.2 Affects of different brand development strategies on consumer buying behaviour ........... 46

4.2.3 Price competition between oil companies and supermarkets .......................................... 46

4.2.4 Recession affects on consumers behaviour ................................................................... 47

4.2.5 Big Names provide little shelter................................................................................... 47

4.2.6 Supermarkets will continues growth ............................................................................ 48

4.2.7 Convenience affects consumer‟s purchasing Behaviour ................................................ 48

4.2.8 Convenience and Price “Best strategy” ........................................................................ 49

4.2.9 Oil companies‟ less interest in retail market ................................................................. 50

4.2.10 Gasoline Surplus ...................................................................................................... 51

4.2.11 Consumer behaviour regarding low prices.................................................................. 51

4.2.12 Value added services ................................................................................................ 52

4.3 Questionnaire analysis ........................................................................ 53

4.3.1 Q.NO 1: What are your car or Wagon Make and model? ............................................... 53

4.3.2 Q. NO 2: What is your car or wagon usage?................................................................. 54

4.3.3 Q No. 3 what type of fuel you use? .............................................................................. 54

4.3.4 Q NO. 4 How much money you are spending on your fuel consumption every month? ... 55

4.3.5 Q NO.5 How often you visit Fuel station for Refilling? ................................................. 56

4.3.6 Q NO. 6: Please tick that which fuel station Company you more often to Visit? .............. 57

4.3.7 Q NO. 7: Please tick the best following reason that why you visit this fuel station .......... 574.3.8 Q NO. 8: As an overall view which fuel station you more likely to go? .......................... 59

4.3.9 Q NO. 9: specify the reason ........................................................................................ 59

4.3.10 Q No. 10: are you found this Survey short or long? ..................................................... 61

5.1 Introduction ....................................................................................... 62

5.2 Re -statement of Research question .................................................... 62

5.3 Importance of Brand and Brand development strategies ...................... 62

5.3.1 Brand image is important for brand loyalty .................................................................. 63



P a g e | x

5.3.2 Responsible company‟s brand Image important for brand loyalty .................................. 63

5.3.3 Global Brand Image Helps .......................................................................................... 63

5.4 Importance of brand loyal customers .................................................. 64

5.5 Easy approach and convenience affects brand loyalty .......................... 64

5.6 Supermarkets’ growth factors: convenience and easy approach ........... 64

5.7 Challenges for oil companies ............................................................... 65

5.7.1 Fuel taxes, Barriers for oil companies .......................................................................... 65

5.7.1 Oil companies can‟t provide Convenience.................................................................... 68

5.8 Different factors which affects brand loyalty ........................................ 68

5.8.1 Price.......................................................................................................................... 68

5.8.2 PLB (private label Brands) .......................................................................................... 69

5.8.3 Income level .............................................................................................................. 69

5.8.4 Easy approach and convenience .................................................................................. 70

5.8.5 Parking facility........................................................................................................... 71

5.8.6 Value added services .................................................................................................. 71

5.9 Recession Affects on consumers’ purchasing behaviour ....................... 71

5.10 Summary .......................................................................................... 73

6.1 Conclusion .......................................................................................... 74

6.2 Recommendations .............................................................................. 79

References ............................................................................................... 82

Appendices “A” ........................................................................................ 86

Appendix “B”............................................................................................ 95

Appendices “C” ........................................................................................ 96

Appendices “D” ...................................................................................... 100

Appendices “E”....................................................................................... 101



P a g e | 1

Chapter 1Introduction

1.0 Background of the study

Branding has been around from the time immemorial. There are quite enough evidences

that branding being used in Greek and Roman times. It gives a significant difference to

product from other manufacturer‟s product or service (Blackett.T, 2009).

The firs road side filling station was established in 1919as a service to members of

petroleum association. Till 1940 roadside fill station grown rapidly across UK and in 1950

first canopy was installed on filling stations which is became core idea of modern filling

station looks in current time. In 1980 Supermarkets started their investment in retail

petroleum industry to give their customers better convenience to the essentials. This

investment grown rapidly and in very sho rt time and it‟s reached up to 40 % in 2008

comparably 19% in 2007 total market share of UK retail petroleum industry (UKPIA,

2008). For example, ASDA‟s filling station and Sainsbury‟s filling station. Supermarkets

are more convenient for buyers as ease of access, offering fuels on much more less price

then major oil companies (Retail Marketing Survey, 2009). Because they don‟t have to

develop new brand name for their fuel business and therefore save huge amount of money

and having reduced cost of running petrol station. Furthermore they offer some fewer

prices when a shopper buys a certain amount of groceries from their stores. Some time

price difference was as much as 20 pence per litter (Retail Marketing Survey, 2009).

Evidence shows that supermarkets gave hard time to fuel companies as in 2000, “The

Independent” reported that Oil giant Shell closed its some filling stations in UK because of

supermarket price war as these pumps did not generate enough sales to get sufficient profit

to maintain the filling-station expenses (The Independent, Friday, 4 August 2000). This

situation particularly made fuel companies much more sensitive about customer‟s brand

loyalty. Oil companies used different brand development strategies to keep customers



P a g e | 2

loyal for their brand and products. As (Quench, John A, Katherine E., 2009) stated that

current economic slump impose significant affects on customers purchasing power and

people are now looking for more value for their money.

Customers became more sensitive about their spending as buying power became shrink by

current decline. People are, now, looking different ways to reduce their cost of petrol

consumption. For example, most of people now preferred small cars because these are very

economical in petrol or diesel consumption (David Shelton, Managing Director at Motor

point). If we study this statement we can reach at conclusion, whatever any brand has

influence on consumer, economical condition does effect on consumer buying decision

and in this situation brand loyalty turn into real challenge for any company.

Branding is an important part of any marketing process and it gives to any company

competitive advantages as long term sustainability in business. In current business

atmosphere it is much important to evaluate these brand development strategies as

customers are now have less buying power and on other hand consumer have significant

amount of low price fuel choices such as supermarkets.

1.1 Overview of Retail Petroleum Industry and Development

Regarding to ianbyrne (ianbyrne.free-online.co.uk), which is the comprehensive database

about history of oil company‟s road maps in Europe and having very brief history about

retail petroleum branding, the oil product distribution in UK was dominated by Anglo

American Oil Company before the First World War. (Part of Standard Oil which used a

number of trading names, including Royal Daylight for paraffin and Pratt's for motor

spirit). At that time BP (British Petroleum) had exclusive right to distribute Shel l‟s fuels;

also British petroleum was a German Owned company at that time. On the other hand

there were small companies and other wholesalers such as Carless, Carpel and Leonard

that alone used to call its motor spirit with the name of “petrol”. In 1914 British

government bought 50 % shares of Anglo_ Persian Oil Company as an act to safeguard

navy‟s need to control fuel oil supplies and same time Anglo -Persian bought British

Petroleum Company. After this Shell was in trouble because company needs to find out

new way to sell its products in market consequently shell bought into Bowring Petroleum



P a g e | 3

which used to have its trading with the name of MEX. At that time petrol used to soled in

two-gallon cans.

Until 1919 there was no filling station. The first petrol filling station was opened by

Automobile Association, near Aldermaston as service to their members and within next ten

years petrol pumps spread up virtually all garages in UK. Till 1930 petrol garages were

still sold multiple branded of petrol and this practice was continued until 1960s. In 1932

Shellmex, BP and Eagle were bound into pooling because of their mutual interest in retail

petroleum as a result the competition level was limited until 1976. After that these factors

were the reasons for the birth of customer‟s incentives. The main motive for the incentives

for customer was “price difference” which was very limited even a penny or so a gallon

cheaper. After the Second World War different petroleum companies like Shellmex and

BP intensively market their product in all over UK and put all their potential to regenerate

brand loyalty (ianbyrne.free-online.co.uk).

As marketing and retailing information based on UKPIA (United Kingdom Petroleum

Industry Authority), in 1950 first time a roof canopy installed over the pumps as a

convenience rather than a necessity. The modern shape of filling station and multiple

pump dispensers, carwash and convenience food store are the invention of same period of

time. After the Second World War the retail fuel market established rapidly and become

more competitive. Different companies applied different methods to promote their product

like promotion of the quality of branded fuel specially its “Octane number”, free collection

of stamps, gift for the each gallon of fuel a nd road maps (UKPIA). As “ianbyrne” stated,

that in 1960 Britain was became a major oil market for many international oil companies

and especially those companies which had found new reserved in North Africa. At the end

of the 1960s self service filling stations became in market and revolutionised petrol

retailing. At the start of the current century here were thirteen most important fuel

companies were working in UK‟s retail petroleum market for example BP, Shell, Total,

Esso, and Texaco.

Regarding to the current statistic of United Kingdom Petroleum Industry Association

(UKPIA) at the end of last year there were 9,264 retail filling stations in the UK. Only in

London there were 900 filling stations having about 9.71 % of the total number of filling

stations in UK (London Fire and Emergency Planning Authority). At the end of the 1980s



P a g e | 4

unleaded fuel almost replaced the previous four stars Leaded super from the market. In the

same decade, supermarkets start their investment in retail petroleum industry, but firstly

they start selling petroleum as experimentally. At that time Sainsbury‟s was the only

company who used their own name for their fuel station. When the major oil companies

like Shell and Bp realize the strength of the competition from supermarkets, they adopted a

new strategy to open convince store attached to their fuel stations. Small companies and

garages obviously were less capable for compete situation and slowly they vanished from

the market all most all over UK. As the 1990s starts, that was a very good decay for

smaller brands and the supermarket. Tesco‟s, Asda and Safeway‟s (Morrison) launched

their own fuel brand to compete their rival in retail marketing „Sainsbury‟s). Same time

these supermarkets became major players of retail petroleum industry and they gain

market share about 25 present (Retail Marketing Survey 2009) and same time when the

price war started between oil companies and supermarkets.

Esso launched a successful price war campaign in market and became market leader in

price war for petroleum products. This thing force the companies to start their different

loyalty programs to keep their customers loyal to their brands like different electronic

loyalty cards and price cut offer from supermarkets when customers buy a certain abo ut of

groceries from them. As UKPIA stated that, in 2008 supermarket obtain 40% of marketshare from retail petroleum industry. They also argues that, retail petroleum has a very

complex trend in competition because of less profit margins, high maintaining cost and

heavy taxes from government on fuel station. This complex situation pushes companies to

adopted aggressive brand development strategies like Nectar card, Shell Fuel Card, Air

Mile and many social development strategies like different programs with the

collaboration of schools, one of them is “Shell‟s Learning to Love Science “as part of

social investment. Petrol companies still using different type of brand development

strategies to attract the customer, giving them the awareness and overall all image in their

mind about company brand and the name.

The low margin of the petroleum products give birth a two way strategy of brand

development and maximization of profit. Some of the Supermarkets and the retail

petroleum companies made the joint strategy and they put petrol station and supermarket

together to maintain their brand development advantages. For example at 24 may 2005

Mark & Spencer and BP came together in market. Companies are st ill doing different type



P a g e | 5

of brand strategies to attract the customs. For example companies use their logos images to

impose the brand effect on customer mind like BP and Shell, and some of the companies

use their country name or Origen name to get the local and in some extent international

brand loyalty like BP (Keller, 2007). All of these brand development strategies directly

puts influence on consumer behaviour and give to consumer helping hand in buying

decision.

1.2 Research Aims

(Chernatony, 1992) stated that, brands are preferred by consumer because they have added

value over and above different products and when consumer recognised values then

consumers are agree to give a little additional price for these goods.

The aim of this study is to find out that how a petroleum company who having

operations in retail petrol market keep their customer loyal with their brand and

how different brand development strategies are useful to do so, especially in the

presence of less price alternatives products or brands such as supermarket‟s petrel

stations which are offering petroleum products at low price and on the other way to

find out the impact of recession on consumer brand loyalty.

Are customers are still loyal with the particular brand and willing to pay some extrato buy or they only look for less price alternatives for petroleum products such as

petrol or diesel because the buying power of consumer became less due to current

economic slump. Second vision of study is that analysis different brand

developments strategise and to find out the impacts of these strategies on consumer

buying behaviour in context of recession‟s impacts on consumer buying decision

for petroleum products.

1.3 The objectives of this study are:

To Investigate the different elements which affects consumer brand loyalty

Find out that, are different types of brand development strategies still use full to

attract and keep customer loyal towards brand?

Find out the impacts of current economic crash on consumer‟s behaviour in the

context of buying behaviour or buying decision for petroleum products.



P a g e | 6

Come across that for petroleum products, consumer do consider any particular

brand or consumer having no more consideration for any specific brand or brand

loyalty and they only look for better price and value for their money.

1.4 Research Questions

“Branding has been around for centuries as a mean to dist inguish the goods of one

producer from those of another” (Keller, 2008). Companies are all ways keep looking to

allocate and implement different types of brand development strategies to keep customer

loyal towards their brand. Petroleum companies are investing huge amount of money and

countless efforts to build the customer‟s approach regarding their products and services to

keep customer loyal towards their brands. It is important for any petroleum company who

having retail operations, to know that, are all these efforts worth it or not? Is the sales of

these products are really relaying on the brand name and brand development strategies?

May be consumer behaviour doesn‟t effected by brand development and they only bu y

petroleum products because some other factors.

For this reason series of questions are been developed in order to find out the information,

such as:

How „less price‟ alternatives are affecting brand loyalty?

For consumer only the actual product is important or they do care about brand

name and brand image when decide to buy petroleum products.

Are there any effects of brand development activities on consumer buying

behaviour towards retail petroleum products?

Are these activities result in purchase of these products?

Are here any impacts of current downturn of economy towards consumer

behaviour for buying petroleum products?

1.5 Rationale of the Study

Most of the research work has been done on the impact of brand development strategies as

how different brand development strategies could give to a company or products

competitive advantages in the contrast of other company‟s brand or products.



P a g e | 7

There is no significant research on how a petroleum company, involves in retail market

keep their customer loyal towards its brand exclusively at same time customer have

different „less priced‟ alternatives as well in shape of supermarket‟s fuel stations.

Furthermore how customer‟s brand loyalty could give to a company competitive

advantages and what kind of strategies company could adopt to keep its customers loyal

significantly in recession time.

1.6 Scope of the Study

This study will discuss different elements of brand development strategies and impacts on

these strategies on consumer‟s brand loyalty in contrast of recession whe ther customer

have „less priced‟ alternatives as well as less buying power in the result of current

economic downturn. Significance of study became much more important as this focusing

on present retail petroleum industry‟s marketing issues.



P a g e | 8

Chapter 2Literature Review

2.0 Introductions

In this section the researcher will discuss the prior studies associated with different

aspects of brand, brand development and brand loyalty. It is also demonstrate some case

studies which will be very helpful to understand the importance of brand and brand loyalty

in retail petroleum industry.

The second most important theme, which is discussed in literature review associated to

consumer behaviour, consumer behaviour in recession and recession affects on consumer

behaviour.

This chapter also will provide and discuss previous research finding regarding price

sensitivity and price sensitive customers in the context customer spending and recession

affects consumers.

2.1 Short History of Branding

Branding has been around from centuries in different forms. It seems really worth full to

discuss the historical background of branding that how branding evolved and how different

aspects of branding were emphasized the consumer behaviour. From the Greek and

Roman time there were examples of brand being used. The shop keepers used to hang

picture above their shops to indicate the different types of goods they sold (Keller, 2008).

The original motivation of branding came from the Middle Ages, when the craftsmen with

specialist skills began to stamps their marks on their goods to differentiating suppliers

became more common so could customer could easily recognised them. Same time

branding became a guarantee of source of the product and ultimately it uses as a form of

legal protection against copying grew (Keller, 2008).The next evolution of branding

regarded with the growth of cattle farming in the new world of North America. Cattle

owners used red hot iron stamps with uniquely shaped end, to differentiate the difference

between own and the other‟s livestock. They left a visible imprint on the skin of every

animal. This practices give the real meaning of feeling for owner ship and insurance of

quality to the owner and fulfil the meaning of term brand which is described by the oxford



P a g e | 9

English Dictionary as “to mark indelibly as proof of ownership, as a sign of quality or for

any other purpose”. (Chernatony, L D & McDonald, M 2003)

Blackett (2009) continues the history of brand by saying that, some of the earliest mass

manufacturing goods were clay pots. Pottery and clay lamps used to sell far from the

manufacturing point, and the buyers looked stamps from the reliable potters as a guide to

quality assurance. The way a potter would classify his pots making any sings or mark at

the bottom of the pot for example a fish, a star or a cross or putting his thumbprint at same

place when the pot were wet during the manufacturing process. However, regarding to

current scenario the wide scale use of the branding started in late 19 th and the early 2oth

century. The industrial revolution and the boom in communication infrastructure give this

practices new dynamics and allow western world to mass marketing of consumer products.

Most of the world successful consumer brands were developed in same period of time like

Coca-cola, Singer sewing-machine, Bass bear, and Quaker oats, cook‟s tour, sunlight soap,

Kodak films, American express travellers‟ cheques and Heinz baked beans. The arrival of

the internet and mass broadcasting system, gradually improved transportation and

communication triggered the scene to mass usage of branding as a tool of differentiate the

products from the other rival products.

2.2 Brand Importance

Brand provides a number of vital functions for retail business. Brand are able to produce

consumers‟ attention, support, loyalty for store, because learn to expect certain products

and brand. (Tickle. K, 2003)

Burnett and Hutton (2007) mentions that, brand are very significant from two points of

view first company‟s and secondly customer‟s. From company side, brands are

fundamental force for a company to prove itself as successful in market. Brands are having

influence to attract specific group of customers and very helpful to build-up association

between producer and product or service‟s user, such as, one pound shops are related to

small income group and 1 pond stores are the target market for low income groups. From

customer opinion, a well known brand could make choice and selection process easy and

straightforward. As in market, lots of brands are existing with numerous designed and

specification, for a customer it is very difficult to take up a new brand except it has already

proved itself. For instance, Mark & Spencer is well known brand for specific group of



P a g e | 10

peoples who are like decent clothing. This reorganization of brand makes selection and

buying process easy.

Companies should have to put more focus for gain understanding about customer‟s

expectation for target market. Marketing tolls such as advertisement and media are really

useful to achieve this target. In fact for a successful brand, it is very important to

understand individual behaviour rather than realization of whole market. As individuals

are undividable entities of whole market. (Burnett & Hutton, 2007).

The definition of marketing defined by Institute of Marketing, “the management process

responsible for identifying, anticipating and satisfying customer requirements profitably.‟‟

Cartwright (2002)

This definition of marketing signifies that, marketing process is about to identify the

customers‟ needs and wants to develop satisfaction level that can be result of future

demand from customers. To achieving this target, marketers should have to keep them self

strongly bound with market to understand and looking for potential and new customers as

well as better understanding of competition powered by other organizations and market

forces. A brand provides significance to any organization or company and on same point

brands are really helpful to understand customer‟s approach to any product. Brands areinfluence a customer to purchase again by creating a satisfaction level in customer‟s mind.

Aaker (1991) stated that, brands are also very vital for any company from strategic point of

view. Particularly, marketers should have to look with keen eye on customer approach

towards their brands in order to improve their production. This activity enables any

marketer to assess consumer‟s approach and loyalty towards brand, which support a

company to develop and change its strategic policy for its long time business sustainability

in market.

As (Guillman, 1993) explain that, internal and external environments are the real

motivation for brand significance. It is very expensive and difficult for any firm, to

expand the new brands or to organize existing brand in extremely competitive market.

Also the awful economic condition makes this clause much poor comparably than

competitive market. Consequently, in the respect of current business uncertain condition,

brand management became more vital and empirical for the success of any company from

strategic point of view as well.



P a g e | 11

As Kay (2006) evaluate, no doubt that brand strength could impress the market ‟s

competitor forces as well as organization itself. . For instance, if you have a look on the list

of top brand of world, Coke is world‟s No 1 brand with the worth of $ 62 billion. In the

respect of present circumstances, brand development and management became more vital

ant significant for brand managers or for any firm. Moreover Martinez & Pina (2003)

supplemented that, from all the imperceptible assets brand is one of the most valuable. As

in most of the marketing activities‟‟ such as advertisement and media, focal point is brand

and its related fundamentals such as slogans as logos. Consequently, companies get attain

many advantages from brand as it is the most core asset that a company could have.

Mostly those brand which are well known and having good repute in market and in

customer mind, perceived as having low risk level. To minimize the risk factor and make

the selection and decision making process easy for customer brand represents the simplest

and primary shape of information. Brands are also represents a channel or mean for the

process of decision making by customer, as well as minimize the risk factor in whole

process. Brand also powered a customer to pay some extra price or value for a product

which is more than that from actual characteristic. A brand image can creates verity of

ideas in customer‟s mind in the respect of characteristics, performance, advantages and the

perceive level of satisfaction about a product and service.

2.3 Brand Development

“Branding has been around for centuries as a mean to distinguish the goods of one

producer from those of another”. (Keller, 2008)

According to the AMA( American marketing association) A brand is a “name, term, sign,

symbol, or design, or a combination of them , intended to identify the goods and services

of one seller or group of seller and to different from those of competition”.

We can say that, whenever a marketer creates a new name, logo or symbol for new

products, he or she created a brand. For example here is different type of brand names

which companies chose. Some companies like General Electric and Samsung use their

name for essentially all their products. some of the companies give the individual brand

name to their products and unrelated from the company‟s real name like P&G (Procter and

gamble) made the products with the name Pampers, Tide, and Pantene brands. Some of the

http://thesaurus.com/browse/characteristic

http://thesaurus.com/browse/characteristic



P a g e | 12

retailer devolved their own brands based on their products and or their store name like

Macy‟s has its own Alfani, INC, and Club Room Brand. Brand name comes from different

forms. Some of the brand names comes from with the name of peoples like Porsche

automobile Orville Redenbacher.( Keller 2007) Many brand based on counties name like

BP (British petroleum) PSO (Pakistan state oil) and many other.

2.4 Key characteristics of a brand

(Herbig & Milewicz, 1997) stated that, Brands are provides a significance to any product

or service from other companies‟ product or service in market. Brands are really helpful to

create significance in customer‟s mind regarding product by using diff erent means such as

different design, colour scheme and verity of symbols. Consequently, brand make

selection and decision process easy for a customer by creating a significant image

regarding the product and service as well as minimize the risk factor in whole decision and

buying process. A brand creates its own characteristics and image in customer mind and a

customer could match these characteristics with its own wishes and wants. A brand name

is a mean of promises and commitment made by a firm, it provide assurance to customer

that a customer will received same quality of product or services which is commit upon

present brand. Regarding same assurance from a brand customer are sometime ready topay some extra price. Therefore, brand could be a primary factor is the success of any firm

or company.

Stanton et al. (1991) quote that, a good brand selection not an easy task in respects,

customer point of view and company point of view. It has been proven by research that

brand name only 12 % is helpful to enhance the sale for any products. Moreover, some

physical characteristics of a goods or products generate difficulty to impose a constant

brand image in customer mind. The lack of standardization is service sector also a core

barrier to build up strong brand image. It is very essential for a good brand that it should

have to present some characteristics or features, also it shout be present these factors to

customers when customer use it, for instance T-mobile and PC world. On the next step,

which is very important feature of a brand, that brand name should be, simple, easy to say,

short and also easy to memorise and spell for instance, Orange, O2 and NEXT. As being

unique, brand can win half of battle only based on this feature. A similar and alike name

with other brand name could be a fatal point from strategic point of view. For



P a g e | 13

understanding of this argument you can just see these n name such as National and Star.

On the other hand brand name should be flexible and able to absorbed new products and

features in its self. For instance, Macdonald‟s has more capability to undertake different

product under its product line than Pizza Hut. Moreover, a brand name should be able to

register by law regarding the country‟s registration law where a company wants to do

business. Regarding the registration law of a country, a company couldn‟t get the

registration for its brand name if this brand name is already acquired and managed by other

firm or organization. (Palmer, 2004) stated that, to be a wining firm, its brand must have

three of these features in it, “Consistency, Risk reduction and finally Functional and

emotional attributes”.

2.5 Different Brand Types

According to Research International Observer (RIO) here are four different types of global

brands. Master brands, prestige brand, Super brands and Global brands.

Master Brands: Master brands are leading brands in brand structure and also only brand

in brand structure. Traditionally, most corporate brands were also considered master

brands. Examples are: like Nike, Sony and Coca-Cola

Prestige Brands: These brands are significantly based on culture or the acknowledgment

of a creator or technology. (E.g. Mercedes is the embodiment of German design and

engineering excellence).

Super Brands: these brands are widely available universally like master brands but here is

little difference between booth of them that these brands are defined more by their kind

than by a myth or narrative. For Examples Gillette, Pepsi, McDonald's, Shell, Philips and

American Express etc.

Global Brands These types of brand are most important brands in brand structure. These

brands are available worldwide, but marketed locally. The local marketing of these brands

some time undertaker by the names of sub brands based on the nature of local market. The

universal acceptability of these brands make then close to customer and make the selection

process easier.



P a g e | 14

According to the Ted Levitt's globalization of markets thesis, global companies and their

brands would enhance their self very fast, could provide matchless quality of products,

available in most ports of world, and provide trust for customers. He describe that,

successful companies always look forward to develop those products which are described

as “everyone” wants.

Fig 2.1: Four types of Global brands Source taken from www.warc.com [accessed date 10 Oct

2009]

According to the Ted Levitt's globalization of markets thesis, “global companies and their

brands could grow inevitably, having capability of global consumers and matchless

combination of quality and commitment, ease of use, reliability, and economical price”.

Levitt described a Brand Utopia in which tastes and wants would turn into more and more

homogenised, with winning companies focusing on what every person desires. (Baker, M

2009)

2.5.1 Retailer and Wholesaler Brands

Brassington, F & Pettitt, S 2006, provided description about retailer and wholesaler brand

that these become major factor in retailing and supermarket businesses. These businesses

have been very active to creating physical products exclusive to the store, reflecting the



P a g e | 15

retailer‟s name. The responsibility and development of brand falls on the retailer side. The

retailer may or may not manufacture the products directly. But somehow label shows

reflection that this product made for this retailer exclusively. They arguments in the favour

of these brands that one possible problem to a retailer is that of customer is buying a

recognised manufacturer brand, and then the source of the purchase is less relevant. A can

of Heinz baked beans represent the same value whether it is purchased from a corner shop

or from Harrods store. One retailer can differentiate from each other on the basis of price

and service but retailers are looking more than that. The existence of the retailer brands is

represents retailer‟s on identity and make the customer to generate physical tour to the

store only for retailer‟s own brand and also its presence in consumer‟s kitchen or usage of

these brand is reminder of the retailer and embodies the retailer value in a more tangible

form, reinforce loyalty and positive approach.

2.5.2 Low priced Retailer’s own Brands

Brassington, F & Pettitt, S 2006, include the fact that the retailer can earn a better margin

own an own-brand and still sell it more cheaply then a manufacturer own brand. This is

because of many reasons like it does not face the product development , brand creation and

marketing coast that the manufacturer or other companies who are marketing their own

brands facing. Retailer own brand is sold on the back of the retailers normal marketingactivity and not with the massive advertisement, promotion and selling cost that each

manufacturer brand have to bear. The most important development in favour of evolution

of the own brand sense over the past few years has been an increasing consumer belief that

retailer own brands are only the manufacturer‟s brands with different label, but

comparatively much cheaper.

2.5.3 Generic Brands

As Brassington, F & Pettitt, S 2006, described that, decision on whether to brand the

product range or not is an easy decision for fast moving consumer goods (FMCG)

organization. For most of the products in this market branding activity is essential. But

difficulty arises with some of homogeneous products because in theory the customer does

not perceive sufficient difference between competing products to make branding worth

full. However here are fewer and fewer truly homogeneous products to be visible. And

one big example is Petrol Brands, have not been created that differentiate that on the basis

on services factors and the use of sales promotion as a vital part of the offering products.



P a g e | 16

Furthermore generic brands are representing another matter. Regarding to this issue a

single brand image covers a broad range of different products. This extreme mainly found

in supermarkets where under a single brand name they are selling basic and low priced

product with the minimum level of information provided on labels. Very good examples

are Sainsbury‟s Basic and Waitrose‟s Essentials lines.

Battle between own-label and manufactured brand expecting to strengthen in the upcoming

years, particularly as own-labels meet head-on the manufacturer‟s claims of superior

quality head-own by also positioning themselves on quality as much as on value(Kahn,

1998).

2.6 Brand Loyalty

Brand loyalty becomes very important during recession time when the economy becomes

worse and people buying power shrinks to the minimum level. As (Martin, 2005) argues

that, the more and more loyalty a brand inspires, the superior the potential it has for the

long term business success. In reality, loyalty is a most important factors for attain this

type of achievement. In all business matters it is principle that you can‟t evaluate, forecast,

or buy loyalty from yours customers. Brand loyalty is the result for a verity of generation

factors, which over time build the that type of loyalty every marketer looking for, the

customer loyalty. (Martin, 2005)

AS (Brassington, & Pettitt, S 2006) explain that, Brand loyalty is a significant mechanism

for devolving new brands and not only for devolving detail in the segment profile but also

for devolving of better understanding of which segmentation variable are significant for

brand development. For example a careful market research could help the organization to

profile “loyal to us” “loyal to them” and switchers; and will help to investigate that what

factors will help full to differentiate between both category. Generally, (Wind 1982)

identify six segments which are these, the first segment which is regard to those are

current loyal users who will continue to purchase of brand, second current loyal user who

continue to use the brand but reduce the consumption, thirdly infrequent users who might

be persuaded to increase consumption with the right incentives, fourth infrequent users

who might decrease consumption because of competitors offering, second last Non-users

who might buy the brand if it was modified and the last is non-users with strong negative



P a g e | 17

attitude that are unlikely to purchase. The most important fact is that, brand loyalty is very

sensitive thing and all the time facing increasing threat. This is because consumer has

number of alternative brands or substitute of the buying brand in the market or promotion

and other loyalty schemes offering by the other competitive companies. The most

important threat in the UK market is coming from supermarket‟s own brand. These brands

are the biggest threats to the existing brands offering from different companies, those are

spending huge amount of money to build their brand. Consumer has very strong opinion

about these brands. They believe that these brands just as good, if not identical, and are

thus prepared to switch to them and to be more prices sensitive. . (Brassington, & Pettitt,

S 2006)

2.6.1 Retention of Brand’s Loyal Consumer

As Bannett and Rundle-Thiele (2005) states that brand loyalty can‟t be describe as a

mathematical concept. The brand loyalty can be used to measure the significance with

consumers. They identify five stages of brand loyalty: Birth; The golden era; Latent brand

loyalty; the birth of multi brand loyalty and the last one is Declining brand loyalty. The

main challenge for any marketer is to extend the golden era as long as possible with the

different loyalty schemes and continuous brand development strategies for discouraging

multi brand switching. If assumes that does brand loyalty exist? We can understand evenfrom a very simple combination of usage rate and loyalty can make a difference to the

organization marketing strategy. For example a large group of heavy user which are also

brand switcher identified so marketers should develop those kinds of segmentation and

strategy that this group could stay with the organization‟s brand for long time and turn

them into heavy users who are loyal to a particular brand. Repeat business is very

important for any organization and that‟s why companies are now more focus on not only

to attract the new customer but also they are more focusing on retention of customer. We

can understand this statement with following example. After a significant study Burger

King estimated that single customer can be worth over 1000 burgers and fries for life time,

and this estimation for one customer has worth over £3000. So clearly we can understand

that losing a customer through dissatisfaction or any other reason is an important factor

and will strike the company‟s overall marketing policy and profits. (Denny, 1998)



P a g e | 18

2.6.2 Brand Emotional Loyalty

(Hallberg. H, 2004) argues that mostly marketers agree that if customer like a

particular\specific brand so the customer will buy more of this product. On other way we

can say that emotional loyalty is a path towards behavioural loyalty. A study which

analysis more than 60000 consumers conform that, significant impacts on the sale of a

particular brand causes by emotional loyalty. It shows that a greater loyalty could be result

in greater sales of a certain brand. In the early stage of emotional loyalty development, sale

growth is usually regular but relatively modest, but at the peak of emotional loyalty

towards a specific brand consumer will by double or twice amount ant often more than

three to four times. When consumer moves to highest level of emotional loyalty this status

consider more than wrathful from all of previous level because at this stage consumer

makes the highest purchases which are valuable more then all previous purchases. As the

number of emotional loyal consumers increases, a brand could enjoy an uneven successful

in market. Because as increases the number of emotional loyal consumer it will affect the

sale of the brand and the brand sale will increase and it will moves a brand toward a status

called „Brand Leader‟. Furthermore the additional sales resulting from high level of

emotional loyalty will be leads brand towards the “scene of market share difference

between two brands”.



P a g e | 19

Fig 2.2 Source: Journal of Targeting, Measurement & Analysis for Marketing

2009

2.6.3 Brand equity

Regarding the definition of Marketing Science Institute, 1998 that „„the set of associations

and behaviours on the part of brand‟s customers, channel members and parent

corporation that allows the brand to earn greater volume or greater margins that it could

without the brand name and that gives the brand a strong, sustainable and differential

advantage over its competitors‟‟. (Rio et al. 2001).

One very comprehensive classification is follows, „„brand equity is a set of brand assets

and liabilities linked to a brand, its name and symbol, that adds to or detracts from the

value provided by a product or service to a firm and/or to the firm‟s customers‟‟. (Aaker

1991)

(Simon & Sullivan, 1993, Rio et al. 2001) stated that, In respect of Justify and investigate

the brand equity here are different aspect, and by analysis these aspects brand equity could

easily measure. These features are parent company that owns a brand, distributor, and

customer. When a brand develops a positive association with customer, the customer based

brand loyalty will on the higher level at that time. We can see brand equity with two

distinguish point of views. First point of view is in the respect of decision making and



P a g e | 20

marketing and second point of view is regarding finance, furthermore in context of cash

flows and expected revenues.

Aaker, 1991 stated that, in the context of marketing viewpoint here are reasonable factors

those are help to generate brand equity. He describe number of constant customer of a

product is the base of value of brand equity. Therefore the issue of brand loyalty became

very imperative part of brand equity. In brand equity, the idea of appropriate benefits and

brand knowledge are core issues to be considered. The final components of brand equity

are copyright, trademark, patents and intellectual proprietary rights. Some other authors

discuss financial aspects of brand equity. Such as, Simon and Sullivan (1993) put influence

of financial aspects of brand equity. In this aspects brand equity evaluation is based on

stock market price. (Aaker 1991, S imon and Sullivan 1993)

2.6.4 Brand Equity in Recession

(M. Riston, 2008) It is important to understand the big brand‟s power in recession time. In

recession time marketers have to understand that brand loyalty is not only the way of

thinking in high sales volume condition but at same time falling consumer buying power is

most important at that time. Those brand who continues to develop their brand equity and

brand loyalty in recession time in different means like offering low price alternatives under

same brand „s umbrella or introduce some different brand loyalty promotion like brand

emotional attachments strategies they could enjoy great success and batter place when

economy will returns to growth.

2.6.5 Generic Brands and Brand Loyalty

Glynn, Mark S & Shaoshan Chen 2009, Stated that quality variability, price

consciousness, price-quality association and brand loyalty influence consumer proneness

to buy private label brand (PLB) or generic brands and also income, education and house

hold size are also tune customer to buy private label brands. Regarded them price

sensitivity and quality variability are most important facts in buying to private label

brands. These both factors are depends on two things, first the product category and the

PLB market share within the category and the both factors are important. For retailer point

of view the price consciousness is much important then the value of a private label brands.

But from the manufacturer point of view brand loyalty is much important than the price



P a g e | 21

sensitivity. In both points of view customer income level is still important to categorize the

difference between both of them, which make the purchasing more difficult to customer.

2.7 The corporate brand image

(Olins, 2008) stated that, from many of factors it is increasingly evident that the nature of

competition is changing day by day. Once it was possible that organization were able to

face the market on the basis of their services, quality, Product quality and price. But in the

current time as businesses are much more matures it seems quite difficult to cope with the

market on these bases. Petrol retailing, financial services, parcel delivery and many

commercial businesses, all are offering almost same level of price, quality and services.

There is very little or no real difference between the products and the services of the

leading players in terms of price, service, and quality of product. Now the business

parameters are changing, being as good in the present business environment only sufficient

to enable an organization to stay in industry. But if any organization wants to presents

itself being liked, admired or respected it is more than competition. What could make the

organization to win in the industry is called corporate branding. Currently companies are

heavily investing to develop their corporate image because they want to compete and

overlapping all the range of internal and external audiences. That is why we have asituation in which brand exist side by side with product brands. Organization has a number

of different models to choose from when they develop system to control and adapt their

own company brands or to absorb. (Olins, 2008)

As Olins state that, in petroleum industry big organization are offering almost same level

of services and quality of products, in this scenario its becoming more important to

understand that how this corporate brand strategy works for organization,. If consumers

are admired and liked by some organization‟s corporate brand the y feel bound with the

company brand and will hesitate to change their brand preference even with less buying

power and competition business economy where they have lots of choices and less price

brands.

2.7.1 Affects of “Responsible Company Image” in Petroleum industry

Aaker 2004, discuss some key points about the company Responsiveness to being a good

vibe company. He argues that, people are really looks for that what kind of people and



P a g e | 22

values of standards working behind this corporate brand and business? People and

organizations are really admires from the values and responsibility of citizenship. They

always try to find out that what kind of organization they are? Is the organization is really

has interested for employees and the society? What about fighting and coping with disease,

improving education, helping the disadvantages and environmental issues like Global

Warming and pollution. A very important and responsive aspect of citizenship is the

environment, which is one of the growing and significant especially in Europe and all over

the word. if we see only from UK we will have very good two example in petroleum

industry that show their concern about the environment and make these companies

responsible and concern to society and environment. Shell and BP both company

introduced environment friendly brands as Part of their heavy investment program towards

renewable energy and both of companies now selling their flues as the minimum level of

sulphur. On the other hand ESSO took the primary decision that renewable energy is not a

possible solution and additionally the Kyoto accords on the environment were unsound

and should be opposed. In the result of this decision a high profile campaign has been

coordinated by Greenpeace with the logo of “Stop ESSO”. And even a successful survey

has been done by Greenpeace. After this survey people who were the regular buyers of

Esso products they stop buying from Esso and company overall sales dropped by seven

percent during the companion which was a year based. (Aaker 2004)

2.8 Brand development strategies

In this section researcher will discuss some brand development strategies which are

adopted petroleum companies.

2.8.1 Brand Transformation

One of the Britain biggest energy company BP, which is having operations all over the

world, also decided to power its brand and brand development program through a vibrant

support program and the main aim was to extend the BP brand in order to exploit a fresh

brand development strategy that was expected to gain a differentiated leadership market

place in the energy industry. The BP wants to change its reflection from being an

established, British petroleum firm that perform to that being a pioneering, progressive,

environmentally responsive energy firm with the vision of “Beyond petroleum” the new

Brand name. For this to help to produce and (more important) to power the new brand BP



P a g e | 23

support was added to lots of the firm‟s consumer facing business included Arco, Aral, and

Castrol as well (Keller, 2008).

As (Keller, 2008) describe, every company use different strategies to gain the customer

attraction to sell their products and services to them. One of the most but difficult and risky

strategy is Brand Transformation. Lander Associates one of the premier image consultant

and strategic designer in the world. They helped build and regenerate some of the most

powerful brands such as, Pepsi, FedEx, GE, Delta, Hyatt, Levi‟s, Procter & Gamble,

Microsoft and LG Group. BP (British petroleum) is one of the recent Clint. When BP

acquired AMOCO in 1998, Castrol in 2000, and ARCO in 2000 as well they became mid

ranking company to a Global Brand. After that BP realised that they need new visio n for

future because of the new global dimension of company. BP transform its self from British

Petroleum to Beyond Petroleum and the new ideology of company was performance,

progressive, innovation and green. This transformation is come out in the result of new

logo, redesigned service station, and everything in between, advertisement, broacher, web

site, tanker trucks, kiosk, employee trainings, and rewards program. But the question is

that, is these all things give help BP to maximization of profit and gain consumers‟

attraction? We can analysis this question by these figures. By 2001 BP sales increased

23% worldwide, by 2002 41 %, and in the same year Fortune magazine named BP a “MostAdmired Company”. The period of 2001-2005 when most of the petroleum companies are

losing public favour; BP brand strength increased by 27% and in the value of its intangible

assists, including brand grown by more than $ 7 billion.

Old Logo New Logo



P a g e | 24

Fig 2.3 Source: [Online]. Available from: www.landor.com

2.8.2 Brand Segmentation

The gasoline marketing had been completely based on attracting customer with low

prices. In that condition it was very difficult to make the profit from business. This issue

push Mobil company in the finding of new ways that, how they can earn the improved

profit from gasoline station business. Mobil interviewed 2000 customers and find out that

only 20% of the Mobil customer buying from Mobil station because of the low price and

on the other way Mobil labelled the Road Warriors, true blues, Generation F3 driver,( for

food. Fuel and fast) they are more in numbers of price favour group. In the result of this

research Mobil introduced a new strategy called” friendly Serve”. By this pro gram a gas

station attendant to approach customer and offer to pump gas and wash window without

any extra charge. (Fritsch, P, Wall street journal)

2.9 Price Sensitivity

Brassington, F & Pettitt, S 2006, describe that, a consumer who is confused by the amount

of information to be analysed and is having difficulty comparing competing products on

the basis of performance and features may resorts price, as the deciding factors. Sometime

a more expensive one may be purchased on the basis that, it must be a better quality

product, or a cheaper one may be purchased on the basis that, it will do the job and there‟s

no point spending more and fancy trimmings. Furthermore they described consumers for

those customers price is a core comparing tool, is called price sensitive customers. For

these customers, marketers should have to be very care full to describe price for any

product. Because other none price factors are not really considerable for customers to

perceived characteristics features from brand. Therefore, price could be a significant way

to differentiating between groups of customers.

2.9.1 Price Sensitive Customer

(Aaker 2004) stated that, In the face of maturing markets that exhibit anaemic growth or

even decline, there is search for growth. Finding a source if growth can be a vital if the

scale of operations is threatened. When volume declines, manufacturing, distribution and

marketing may be in danger of becoming inefficient, and profitability thus is strained



P a g e | 25

further. One source of growth is often a value market, whose frequently considerable

vitality is driven by value-seeking customer, value retailers, and new technologies. More

and more marketers, from tries to clothes, computers to electronics, energy to petroleum,

are seeing a growing value segment. One driver is price sensitive customer. In these

markets, a significant number of buyers are turning from prestige and luxury to lower-cost

brands that deliver acceptable quality and features. In part, this is caused in some context

by the buyers being conditioned to price deal and promotion. As a result, perceived

differentiation is reduced for the value seeking segment, and the relevance of price is

elevated. Another driver is simple economics, especially when the economy become soft

or worse, budget squeezes often make non serving money a family imperative. A second

and related contributor to the growth of value segments is a set of new channels that

typically have a lower cost structure, use aggressive every day pricing, and freely use

private label goods.

2.10 Recession Affects on Brand

Simon Davies, (Marketing director, Moison Coors Brewing Company) said that even in

recession time fundamental of marketing does not changes. A good brand positioning will

always be good and it doesn‟t affected by bad economic condition. He coded the exampleof Woolworths' problems that, fall of this retail giant is not because of recession but it is

but it made the brand's lack of a clear position impossible to hide from view, on the other

hand a reliable and constant brand positioning is of great value to all marketers.

2.10.1 Generic Brands in Recession

As Riston 2008, stated that not every brand lose their market share in recession, along with

you can see this behaviour in high street value brands where value players who focus on

discount sales could also do shining. Big supermarkets are recession-proof in these days

because of their own label brands. Under the own label b rand they are offering value

products, cheaper alternatives in contrast of manufacturer brands and real indulgences

from their fines lines.

2.10.2 Affects of Current Economic Slump

We can understand the affects of current economic down term with the statement of David

Shelton, Managing Director at Motor point. He said that: “While the credit crunch has



P a g e | 26

impacted on the economy, our sales figures show it hasn‟t slowed down the number of

people buying new and nearly new cars”. What is clear though is that people are

becoming ever more conscious of fuel consumption, and as a result, small cars are proving

extremely popular”.

2.11Consumer Buying Behaviour

“It is the study of process involves when individuals or group select purchase, use, or

dispose of products services ideas or experience to satisfy needs and desire”( Solomon

2009)

“Consumer behaviour is the dynamic interaction of affect and cognition, behaviour and

environmental events by which human beings conduct the exchange aspects of their lives.”

(Olson & Peter, 1994)

Companies are always been interested to understand consumer behaviour because they can

make the different strategies to influence consumer to buy their products or services based

on consumer behaviour analysis. The success of any company‟s marketing strategy will

depend on the consumer reaction that how consumer react towards company‟s products

and services. Now it becomes very important that to find out what satisfied customer,marketers, must examine the main influence on what , where, when, and how customer

buy services or products.(Dibb, Simkin, Pride & Ferrell, 2001).

These are main factors that are important for every company to predict how consumer will

response to different marketing strategies. Eventually this information helps companies to

compete more effectively in the market place and push the company to more satisfied

customer.

Consumer decisions can be classified into three different categories first routine response

behaviour, second limited decision-making and the third is extensive decision-making.

Consumer uses routine response behaviour when buying regularly purchased, low cost,

low risk items that require very little search and decision attempt. (Dibb, 2001)

The value of the single customer relating ship and the total value of all customer

relationship of an organization is completely base on consumer behaviour towards the

firms and its products and services. Mostly if a customer used multi services and products



P a g e | 27

from a single company it is more batter for organization because it creates more value for

firm. This basic logic leads to the customer behaviour. (Bruhn, M & Georgi, D 2006)

From the marketing planning point of view consumer behaviour depend on the mixture of

culture, social, psychological and personal influences. All these factors are involves in the

ultimate buying decision of a consumer. (Gilligan, C 2009)

Gilligan, C 2009 argues that, buying decision process starts with the consumer

reorganization of the problem or we are known as more commonly a want. It is lead

customer to the internal stimulus (hunger or thirst) or an external stimulus in the shape of

advertisement or a colleague comments. This leads to the search for information. Which

might be could get from different type of advertisement, brand development or the deeper

level of wide information searching. It involves one or more of four different sources.

Personal sources, such as family, friends, colleagues and neighbour

Public sources, such as the mass media and consumer organizations- a classical

example would be the Consumer Association‟s WHICH? Magazine

Commercial sources, like advertising, sales staff and broacher

Experimental sources, such as handling or trying the product.

As Kotler stated that, almost every consumer is different in terms of products

knowledge, involvement, and purchasing behaviour. Kotler describe a consumer behaviour

model, in this model he present the buying process in five stages. This model is very

significant to understand the typical buying process by consumers. The first step is

problem reorganization second is information search, stands on third, evaluation of

alternatives, fourth is purchase and the last is post purchase assessment. On the other hand

it is not always essential that a consumer go through from all of these five steps and even

some cases this order can be reverse (Kotler.2005).



P a g e | 28

Source taken from Marketing Management (Kotler. 2005)

When a consumer make a decision to purchase low involvements products that is

considers to have a low risk s/he normally has a proffered brand and will stay with it.

Doesn‟t matter that might be there will be wide range of even good brand selection. In that

case consumer goes directly from the problem reorganization stage to make the purchase

decision, skipping the information search and evaluation of alternatives.

2.11.1 Understanding Brand Affects on Consumer Behaviour

Different theories based on consumer behaviour explain that why strong brands on which

consumer have high brands knowledge receive a disparity response. We can categorize this

process in three different stages of consumer‟s creation and use of brand awareness. The

first step is attention and learning that‟s build the brand knowledge structure. Second

understanding and valuation of marketing information and brand knowledge and the last is

mechanisms that affects the actual choice process, that is, that application of brand

knowledge.( Hoeffler, 2003)



P a g e | 29

2.11.2 Consumer Buying Behaviour in Recession

In recession time consumer become more fundamental about their spending. Consumer set

their priorities in recession time differently and reduces their spending. Marketer have to

understand that in glooming time of economy the high sales volume is not only the

product of cleaver advertising campaign but it‟s really depends on consumer disposable

money and people‟s confident behaviour about their future. In recession time consumers

have falling incomes with the piles of bills and this situation make consumer very sensitive

about their spending. Furthermore at same time, a series of corporate scandals, failures of

financial, insurance and housing institution and taxpayer‟s bailouts foe mismanaged

business makes consumer more doubtful about their future earnings. Consumer also

postpone or reduces outside treats like dining and window shopping and delay purchases

of postponeables such as dental cleanings, and e liminate purchases of expendables such as

resort holydays. ( Quelch, John A., Jocz, Katherine E. 2009)

As IGH chief executive said that “all brands had seen declines but agreed with Fuller that

a big system provides shelter”.



P a g e | 30

2.12 Summary

From literature review, it is observed that different authors discuss the importance of brand

and brand development strategies. In respect of these authors, brand and brand

development is very important for any company to differentiate its products from other

similar products in the marketplace and gain competitive advantages. . Companies are

always been looking for innovative strategies to make their brands successful and

competent in market Such as brand transformation and brand segmentation. In market

different types of brands are exists and every brand types have its own advantages and

disadvantages. In respect of this study researcher discuss some fundamental about brand

loyalty. Different authors put influence that brand loyalty and brand loyal customers are

very essential for any company to make itself as a successful organization and gain

competitive advantages.

From available literature review it could be easily explicable that, here are some factors

which could affects brand and brand loyalty such as price and economic condition of

country. Recession also leave some significant impacts on consumer behaviour. In

recession customer become more sensitive about their spending and spend less.

Present literature review proven that brands and brand loyalty is a fundamental factor in

any company‟s success in markets. But regarding this research here is the gape that for

retail petroleum industry how can a company keep their customers loyal towards its brand

and products in the presence of low priced alternative brand such as offering from

supermarkets. It is needs to be investigate that are these brand development strategies are

really worth full to do so? Furthermore it is also important to find out that brand

development is only way to keep customers loyal or oil companies could implement other

strategies to maintain its brand loyalty in market.



P a g e | 31

Chapter 3

Research Methodology

3.0 Introduction

Chapter there will discuss the source and method of data collection, the sampling

technique, research tools and procedure adopted in research process. The researcher‟s

objectives will be discussed in detail and as well as the methodology that best matches this

research study‟s aims and objectives.

The research focusing on following core issues: Data gathering, research approach therectify research problem, rational about chosen method, data analysis tools, rational of data

analysis tools in respect of reliability and validity regarding this research process.

3.1 Research Process

The research conduct a imperial study on retail petroleum industry, that how petroleum

companies keep their customer loyal to their brand as well as customer have less priced

alternative such as supermarkets, with less buying power bring on by recession.

Malhotra (2008) presented, six focal points in order to complete a research process also he

describe that almost in every research process these six steps taken place. Also the

sequence of these steps almost same in every research process. The sequence of these

activities is really well connected to the research process. Most of the researches are

following the same procedure as showing follows:



P a g e | 32

1. Problem Definition

2. Development of an Approach

3. Research Design

4. Field Work and Data Collect ion

5. Data Presentation and Analysis

6. Presentation of Result

Fig 3.1 Research Process: Source: Malhotra (2008)

3.1.1 Problem Definition

AS Malhotra (2008), in this research process he presented the first step as Identify the

problem. In first step, generally he identifies the problem or research phenomenon which

researcher wants to deal with.

The present research looks at the impact of branding on consumer behaviour that

how a petroleum company could keep their customer loyal towards their brand.

Fuel marketing companies are having operations in UK from long time. Less

margin in petroleum products give birth to adopted different brand development

strategies as a mean of keep a company in business for long time and sustain

reasonable profit according to their investment in industry. This research looked at

the assumption that consumers have lees priced alternative in market, such as



P a g e | 33

supermarket filling stations which are attached by stores and also consumers have

less buying power because of current economic slump. The particular aim of this

study to find out that whether all these brand development strategies are really

supportive to a company to keep their customers loyal towards its products that

leads to a competitive advantage for organization.

3.1.2 Research Question

How can a company keep its customer loyal towards its brand by using different

brand development strategies? Particularly for retail petroleum industry is chosen

to find out the impacts of brand and brand development activities on consumer’s

loyalty in the presence of widely available less priced alternatives. 3.1.3 Research Purpose

Purpose of this research is to identify the impacts of different brand development

strategies on consumer’s loyalty with the specific focus of retail pe troleum

products. Also find out the best strategies to keep customers loyal to these

products as well as pros and cons of these strategies. This process will be

conduct as by the using of phenomenological means and in the end breakdown

will be conduct by using grounded theory.

3.1.4 Research Objectives

In very beginning of this research process, explicit objectives have been allocated to clear

understating of this research process. It will assist the researcher to more focusing on

research phenomenon as well as understanding of research on broad spectrum. After

critical analysis key objectives of this research process has identified as follows:

To investigate the different elements this affects consumer brand loyalty.

Find out that Different types of brand development strategies are still use full to

attract and keep customer loyal towards brand.

Find out the impacts of current economic crash on consumer‟s behaviour in the

context of buying behaviour or buying decision for petroleum products.

Come across that for petroleum products consumer do consider any particular brand

or consumer having no more consideration for any specific brand or brand loyalty

and they only look for better price and value for their money.



P a g e | 34

3.1.5 Research Method

AS Blackman (2005) stated that, a research process could be defined as two

parts. First is exploratory and second is confirmatory. Exploratory method is very

helpful for researcher to gain crystal understanding that “what’s happening”

insight. More explanation is that, an exploratory method been used when the

researcher don’t have clear understanding of research phenomenon. Also it’s

powered the researcher to analysis the research phenomenon in new light.

(Robson, 2000) on the other hand confirmatory research approach mean that when a researcher

have a clear idea that what is going on , and researcher have some supportive

theory about the happing. The objective will be to find out for researcher that,

whether this theory is supportive for this factor or not. (Blackman, 2005)

In the respect of above explanation, this research study could be defined as both

confirmatory exploratory, but main objectives more driven to confirmatory.

Because the researcher have theories that brand development having impacts on

customer based brand loyalty. The researcher objectives are to confirm that these

theories are supportive to end result or finding. Therefore in this respect this

research process is more confirmatory.

3.1.6 Research Design

(Collis and Hussey, 2003) stated that, research design as science and art of preparation of

action is going to be taken to get a valid and reliable result from a research process. In this

process researcher will discuss the characteristics of a research process that in what way

this research is going to be taken and what fundamental issues will be discuss in this

research process. Over all research design is based on overall view of a research process.

Blackman and Maylor (2005) presented two models for conduct a research study as a

means of research design. These designs are based on two research approaches firstly

scientific research approach and second is ethnographic research approach. Both

approaches are explicit by following figure:



P a g e | 35

Table 3.1 Comparison of scientific and ethnographic approaches

Characteristics Scientific Approach Ethnographic

Approach

1 Question Type Who, How, Much Why, How

2 Associated Method Case studies, Statistics Interviews, Observations

3 Data Type Mainly numbers Mostly words

4 Findings Measures Meanings

This research has been conducted using ethnographic approach. The researcher aim is to

study this phenomenon in specific situation. The researcher studied that how differentbrand development strategies keep customer loyal mostly through interviews, questioners

and expert opinions.

Fig 3.2 Research Design Adopted from Collis and Hussey (2003)

Identify Research Problem

Purpose of Research

Develop Theoretical Framework

Define Research Question

Define Terms



P a g e | 36

Identify Limitation of Study

Decide Methodology

Determine Expected Outcome

3.2 Research Approach

3.2.1 Qualitative Research Approach

A very simple definition of qualitative approach is “"any kind of research that produces

findings not arrived at by means of statistical procedures or other means of

quantification" (Strauss & Corbin, 1990).

Qualitative research approach could be defining in the respect of many data collection

methods. For instance interviews, content analysis, evaluation and semiotics as well as

customer feedback forms. (Saunders, Lewis & Thornhill 2007). Any non numeric data

collection method will be considered as Qualitative data.

Qualitative research approach is very useful to understand very complex phenomenon such

as consumer behaviour, attitudes, values, concerns, as well as business decision and policy

formation.

Oliver (2004) states, that qualitative approach is very use full to understand for social

phenomena. This research approach includes interviews, expert opinions and observation.

This research approach will enables the researcher to understand the customers brand

loyalty towards retail petroleum products.

As Malhotra, 2008 identified two methods of research approaches, Qualitative and

Quantitative. The both research approach can be used by researcher depends on

that what kind of information or data researcher wants to investigate. Qualitative

research approach is very appropriate to understand the phenomenon that is

having contact with daily situation.



P a g e | 37

Qualitative research approach is most appropriate research approach for any

business or management administration research. (Gummesson, 2000)

Furthermore Yin (2003) stated that, qualitative research approach enable a

researcher to deal with unbiased viewpoint. It is also helpful to obtain fair result

from data analysis.

In the present research qualitative research approach will be use. As in this

research process the phenomenon which is under investigates is, customers

brand loyalty towards retail petroleum products and the impacts of brand

development strategies in brand loyalty.

In this context researcher is quite sure that, qualitative research approach is best

math regarding this research process.

3.2.2 Triangulation Approach

It is also referred as multi method approach. The use of the multiple method approach is

increasingly within management and business research (Curran and Blackburn, 2001).

Regarding this approach quantitative and qualitative technique and procedure will be use

with the combination of primary and secondary data options. In business and management

researches multiple methods are use for the reason that, they provide better opportunities

to answer your research query and they let you to do better estimation the scale to whichyour research finding can be reliable and conclusion made from them( Tashakkori and

Teddlie 2003).

Multi method has two basic advantages to choose both approaches in single research

projects. First benefit is that different method can me apply for various purpose in

research. For instance interview at an examining phase, in sequence to understanding for

the key question before using a questionnaire to shared expressive for explanatory data

collection. This will give the confidence to the author were addressing the most significant

concern (Tashakkori and Teddlie 2003).

3.3 Data Collection

As per regarding the broad nature of this research several data collection method has been

adopted by researcher such as interviews and questionnaire . The chosen methods have

their own advantages and disadvantages. But significance of all these data collection

method is proven. As (Yin, 2003) stated that, interviews are the most important data



P a g e | 38

collection methods. Interviews are focused on phenomenon of study and the most

compatible source of data collection. The interviews are designed after care full

consideration available literature and secondary data. The researcher tries his best to make

these interviews as simple as possible for interviewee. This effort will result simple and

fines primary data. The interview structure is designed as open ended. The time period of

interviews are varying regarding interviewee. Structure based on time limit 30-45 minutes.

The questionnaire designed after careful consideration of literature review and different

sources like case studies from retail petroleum industry as well as brand development

agencies such as Lander associate. The questionnaire is structured in the form of “fixed or

closed ended”.

The questionnaire will be distributed by E mail and by hand as well. As Saunders, M &

Lewis, P & Thornhill, A 2007 describe that, the internet-mediate questionnaire are

regarded as self-administrated questionnaire. These types of questionnaire are completed

by respondent by using of internet. These types of questionnaire are time saving, cost

saving as well as easy to distribute. The distribution facility is provided by

www.surveybob.com , same web site where researcher prepared his questionnaire. One

other method will be adopted to distribute this questionnaire is that, researcher will reach

to the fuels users and ask them to fill questionnaire. This method will allow researcher toenhance its personal opinion and get deep in to purchasing behaviour about petroleum

products.

http://www.surveybob.com/





P a g e | 39

Fig 3.3 Source: Research Methods for Business Student by Saunders, M & Lewis, P &

Thornhill, A 2007

3.3.1 Sample Population

In compliance with the researcher topic selected industry will studies in relation to

brand loyalty towards retail petroleum products. The researcher made every effort

to analysis that, how a petroleum company could keep their customers loyal with

its brand in the presence of other less priced and easy accessible brand or

products.

The population of this research has carefully selected after examination of groups

who are using retail petroleum products. We can differentiate petroleum product

users in two categories. One is retail consumption and second is commercial

consumers such as big companies like rail, bus and aircraft companies. Because

this study was regarded towards retail petroleum products so first of all researcher

chose retail consumers, as matter of fact retail consumers are using large amount

of petroleum products as compare to commercial consumers (Energy Institute UK,

2009).

Second most important thing is that, in retail market mostly petroleum products

usage by home user or those who are using vehicle for their personal use (MR.Baker, Energy Institute UK, 2009). Lastly the focus of this research is retail

petroleum industry and in this industry mostly fuels being consumed by home

users and personal use like for going office or work (vehicles), though it is

believed that a similar approach can easily be replicated to other fuels users as

well who using fuel brand and brand loyalty behaviour could easily be observe.

3.3.2 Selection of Sample

Raulin and Graziano (1997) it is impossible to collect data from all available

sources to define a research phenomenon and suggest solution. Saunders, et al

(2007) stated that, sampling technique reduce the amount of data to the level of

manageable. Moreover the process of selection of sample will be continue till

desire required sample has come out.

For present research data will be gather throw semi structure interviews,

questionnaire and expert opinion. All these data collection method considered as



P a g e | 40

primary sources. The interviews will be really helpful to see insight the industry

and get the reliable primary data.

Interviews also considered as mean of human attraction so the personal

observation from researcher will be taken place as well as importance of human

attraction has proven.

Fig 3.4 Source: Research Methods for Business Student by Saunders, M & Lewis, P &

Thornhill, A 2007

3.3.2.1 Secondary Data

Secondary data is time as well as cost saving. It will provide the present data regarding the

petroleum retail industry and the access to campiness‟s brand development strategies. On

the other aspects it will provide the background of the study and will build the bridge

between the study and current literature reviews like opinion of different authors from

books and publishing journal from on-line as well.

3.3.2.2 Primary Data

In the sequence to collecting of primary data the communication were first entered

into with potential respondent to industry managers who are dealing retail

petroleum industry via phone calls, e mail and personal visit. To maintaining the



P a g e | 41

transparency and reliability of this research the researcher approach those

managers who are involved in retail petroleum industry but as independent

authority such as, Energy Institute, United Kingdom Petroleum Industry authority

(UKPIA).It was also helpful to build up unbiased view regarding consumer’s brand

loyalty.

3.3.3 Sample Techniques

For this study researcher technique will involve random sampling. The research

approach for this research has chosen qualitative research approach. It is includes

interviews, questionnaire, expert opinion and personal opinion. Different methods

will be used to sample population.

3.3.4 Semi Structured Interview

Semi-structured interview, questionnaire are design to ask the question for

qualitative analysis about the customer based brand loyalty. Interviews will be

conduct with retail petroleum industry managers and energy experts and other key

experts related from petroleum industry.

3.3.5 Observations

The use of different brand development strategies and other activities to keepcustomer’s loyalty in retail petroleum industry, less price alternative of these

products and the pros and cons of brand development strategies have been

keenly observed by the researcher since the inception of this research.

3.3.6 Expert Opinion

Interviews will be conducted with experts and the stake holders in the area of retail

petroleum industry. These inquiries includes different fuel marketing companies in UK

and other countries, different brand development agencies and several supermarkets in

London which having fuel stations attached next to them.

3.4 Overview of Qualitative Analysis

Miles and Huberman (1994) define that; here a different ways of data collection depends

on the research‟s nature. As Maylor and Blackman (2005) established that, for business



P a g e | 42

and management research qualitative data analysis is significant because its work in multi

way. It deals with subjected organization as well as people in organization.

3.4.1 Qualitative Analysis Using Grounded Theory

Denzin and Lincoln (1994) states, there are many methods for qualitative research but the

grounded theory is one of the best methods. Some other authors such as Straus and Corbin

(1996) found qualitative research method as a set of systematic procedures and the use of

grounded theory is appropriate to formulate a theoretical Frame work under examination.

Goulding (2002) define that, the grounded theory is really supportive to explain behaviour.

Almost all the business and management are about behaviour; therefore grounded theory is

really helpful in business or organizational research. In the start of grounded theory, data

collection starts without prior structured framework.

This theory is helpful in developing a defined theory which helps to understand the

consumer‟s brand loyalty towards retail petroleum products in the presence of low priced

alternative brands.

After identifying aims and objectives, the selection of grounded theory for this

research study is an undeniable decision. To investigate the present industry and

consumer behaviour there was a need of framework to understand the consumer’sbrand loyalty towards fuel petroleum products with the counter of less priced

alternative brands.

Some of the selected reports are also taken for in depth investigation, Such as

retail marketing survey from Energy Institute, Mar 2009-2010 and Industry Outlook

from UKPIA 2009. The grounded theory approach will be use to analyse these

reports because the qualitative research method helps to develop a theory which

helps in mentioning findings. Therefore, grounded theory helped to get a clear

picture of consumer’s brand loyalty towards retail petroleum products.

3.4.2 Qualitative Data Analysis by using Software

Well designed and executed surveys are really helpful to minimize the problem that might

you will face in data analysis. Computing software are easiest and quickest way to analysis

your data. Software are really helpful to generate final result so you can show in your

finding and also very supportive when you do final suggestion in your research study

(Tere, 2006).



P a g e | 43

Because of this reason the researcher chose software as well, to analysis the data. This

software is provided by same online website where researcher developed his questioner

survey. This software works very efficiently according to the required way of study.

Whenever an online participant submits its survey this software allows researcher to see

the result after each submission. This software automatic developed final result and show

results in bar graphs with percentage. It shows to researcher very clear view about data and

significantly helpful to generate final result and overall understanding about this study.

The website is www.surveybob.com .

3.5 Research limitation

As this research study is focusing on retail petroleum industry OF UK, the wide nature of

this study is demanding some research limitations which are very essential to discuss. The

researcher has limited resources to search all over UK, to find answers to research

questions.

On the other side secondary data available regarding this research is very limited as all

companies have their own data base and protect ion system. Moreover, the researcher has

limited time for his research, it is fairly possible that, in the given time period the

managers and key experts who are supposed to conduct interviews, they do not have

sufficient time to spare, therefore it will affect the quality of research questions.

3.6 Summary

The present chapter is based on analysis, design and techniques appropriate to find out that

that how brand development strategies are really helpful to keep costumer loyal towards

any brand or company‟s products, for which research has been conducted. Selection of the

methodology for any research have critical importance as it explains the complete process

of research and enables the researcher to analyze and interpret the results from the

gathered information or data.






P a g e | 44

Chapter 4

Interview‟s findings and Questionnaire

analysis

4.0 Introduction

This chapter deals with the analysis of research data obtain from primary research included

interview, expert opinion and questionnaire. The researcher conduct interviews with

Energy experts, retail marketing experts and UKPIA Managers. These all interviews and

opinions are much reliable as these all people have really concern with retail petroleum

industry. As all the major Oil companies, they all are members of UKPIA and on the other

hand experts from Energy Institute, which given opinion to researcher, they are also

having keen eye on retail petroleum industry in UK from long time. In these terms, these

interviews and opinion are really significant and valuable for this study as well as

reliability is proven. (A blank copy of semi structured interview attached Appendix B)

Secondly researcher included data in this chapter which is gathered from surveyquestionnaire. The questionnaire was designed very carefully after intensive research on

literature review and case studies. Also to make sure that the questionnaire is reliable and

workable. Researcher gets opinion about this questionnaire from UKPIA (United Kingdom

Petroleum Authority) and Energy Institute UK. The both institutes appreciated it and give

their opinion as very positive. Therefore the data which is collected from questionnaire is

reliable and very accurate regarding this study.



P a g e | 45

The core issues which is discussed in these interviews and questionnaire is brand loyalty

towards retail petroleum products. Why customers change their brand loyalty. How

different factors affect brand loyalty? How a company keep their customers loyal to their

brand? And how can oil companies counter competition from less price alternative? The

findings for this study are follows. (A blank copy of questionnaire is attached Appendix A)

4.2 findings from Interviews and Expert Opinion

4.2.1 Importance of Brand Loyal Costumers

From all of these interviews and experts‟ opinion researcher got a clear idea that, for everycompany loyal customers is very important in every condition whether in recession or in

good time of economy when people have good buying power and enjoying the fruits of

better economic condition.

As MR. Brendan (CEO of Petrolprices.co.uk) point out that “no doubt, brand loyalty is

very important for any company to keep itself in market for long time. Oil companies are

trying to counter competition from supermarkets by using different strategies such as

loyalty cards and low price”

MR. Vandervell (UKPIA) said that “Most companies are trying to meet competition by

loyalty offers, better quality fuel, standard of sites & service, as well as being competitive.

On price

For every oil company who having operations in retail market, or any supermarket who is

offering fuel products as well as groceries item, the main concern of these companies are

retention of customers or keep customers loyal towards their product and services becauseall these companies want to keep their selves in business for long time. Every customer is

individual investment for these companies and they always trying keep customers loyal by

using different brand development strategies like offering less price on fuels, loyalty cards

for example Shell and BP loyalty cards and same trend we can see from supermarkets like

Tesco Club card which is introduced by Tesco‟s and Nectar Card which is presented by

Sainsbury‟s , providing better quality of fuels which could be enhance the performance of

vehicle like Shell‟s V_ power and BP‟s Ultimate which BP claims that “More



P a g e | 46

performance, less pollution” also standards of sites by providing different facilities like

small convenience stores such as BP comes together with Mark & Spencer as well its own

coffee and food shop with the name of “Wild Bean Café”. All of these services and

strategies are showing that retention of loyal customers is very much important for every

company. As it has prove from different studies and real experiences, that if any company

want to keep itself in business for long time, retention of loyal customers should be focal

point to achieve this target.

4.2.2 Affects of different brand development strategies on consumer buying

behaviour

Oil companies are really concern about their customers‟ loyalty towards their products.

Addressing the social investment and concern with climate, are very good examples from

these oil companies. BP‟s Green Investment program and Shell‟s social investment

programs are one of them. These investments are really supportive for companies to give

an impression to buyers that these are really concern with social and environmental issues

and these will helpful to get buyer‟s attraction towards company‟s product and services.

Abstracted from MR. Baker statement (Energy Institute UK)

When BP announced its wind power and solar energy program, after that companies sales

all over the world increases and also BP got success to prove it a “responsible company”.

4.2.3 Price competition between oil companies and supermarkets

Mr. Nick Vandervell, made his argument about this issue:

“Market research shows a combination of factors including convenience & price.

Supermarkets have tapped into this trend of people filling up when they do a weekly shop,

often offering a promotional fuel discount linked to amount of shop purchase. For other

more regular daily car travellers filling up more regularly, convenience, price & facilities

are important”.

Supermarkets are giving tough time to oil market companies with their less price market

strategies. Supermarkets have competitive advantages on oil companies and are more

capable to offer less price on fuels products. Because their main business is groceries and

other day to day usage items along with, they are enjoying good profits on these products.

Oil business is a way to offer a convenience for customers to stores. Fuel stations attached

to stores gives real economic of scale to supermarkets to offer fewer prices on fuels. On



P a g e | 47

other hand when a customer purchases some groceries items from supermarkets offers

some extra saving on fuels as well. In this situat ion supermarket already earn from its

groceries items and now they can offer fewer prices on fuels as well. (This argument

abstracted from MR. Baker from Energy Institute)

On other hand oil companies are really trying their best to counter “less price strategy”

from supermarket to adopt different business strategies. Shell‟s “Price Watch” is an

example of it. Every company wants to keep its self in business for long time with having

better profitability. Different price strategies could be a helpful strategy for a company to

keep customer loyal towards its product and services. Regarding oil companies how much

these strategies are helpful, researcher will discuss in discussion chapter. As MR

Vandervell made argument that “Most companies are trying to meet competition by loyalty

offers, better quality fuel, standard of sites & service, as well as being competitive. On

price “

4.2.4 Recession affects on consumers behaviour

Nick Vandervell from UKPIA stated that “Fuel demand is down about 5-6% in volume

terms since the start of the recession. Looking at Govt DfT data, there are signs that

people are driving less & perhaps cutting speed”.

Recession really affects on consumer‟s buying power. We can see same practice in fuel

consumptions. Regarding to the UKPIA statistics, fuel demand is down about 5-6% in

volume since the start of recession. We can conform this from data of DFT (Department of

Transport UK), that people are driving less and perhaps cutting speed. These statement

shows that recession really impose some affects on consumer purchasing behaviour.

People having really care about their fuel consumption budget as in recession they reduce

their consumption on fuels.

4.2.5 Big Names provide little shelter

AS MR. Baker stats that, “big oil companies are working in market from long time. They

have large number of fuel stations therefore still more customers could catch them on

roads.

In recession big oil companies who are working in market for long time they have little

advantage in contrast of other oil companies and brand. These big players are working in



P a g e | 48

market from long time so people are little much aware about these campiness‟s product

and services.

On other way, as these companies are pioneers of oil marketing and having biggest number

of site in UK therefore it is also a advantages for these companies that having large

number of sites means more approachable to customers. This penetration of market also

been really helpful to these companies in recession time that people are more approachable

to these filling station and these companies maintained their sales even in recession time.

4.2.6 Supermarkets will continues growth

By MR. Nick Vandervell , “Some oil companies have retreated from fuel marketing eg Jet

& Texaco – and only supply their branded fuel to sites that are owned by independent fuel

retailers. Many oil companies are wholesale suppliers of gasoline & diesel to

supermarkets. The UK has a growing surplus of gasoline because of the growing trend for

diesel powered cars, so supply to supermarkets can be an attractive option to the usual

export route to the USA”.

Supermarkets became major players in retail petroleum industry. Supermarket growth is

really swift in fuel marketing as they established their self in very short time. They are

having 40% of market in retail petroleum. Because these are more convenient to customers

as ease of access and also offering less price while comparing other oil companies. It is

expecting that in future supermarkets will be takeover oil market. The signs are very clear

that oil companies are losing number of sites in UK for example TEXACO have only 16

company operated sites in 2009 which are very less compare to last 10 years. On other

hand supermarkets are increasing in volume as well as in number of sites. In the end of

2009 supermarkets have 1259 sites across UK which is high comparing last year Retailmarketing survey 2010, Energy Institute). This trend also supported by MR. Baker

(Energy Institute).

Regarding to this trend of expansion, experts predicts that supermarkets will become key

player in retail fuel marketing.

4.2.7 Convenience affects consumer’s purchasing Behaviour

Regarding MR. Nick Vandervell from UKPIA,



P a g e | 49

“Market research shows a combination of factors including convenience & price.

Supermarkets have tapped into this trend of people filling up when they do a weekly shop,

often offering a promotional fuel discount linked to amount of shop purchase. For other

more regular daily car travellers filling up more regularly, convenience, price & facilities

are important e.g. café or small shop to buy food or cigarettes as well as fuel. Forecourt

shops are a very important contributor to the profitability of a filling station.

One very important discovery regarding this study is that consumers are very much

affected by Conveniences and easy approach to filling stations. Supermarket expansion are

really depends on ease of access.

When supermarkets offered fuels stations attached to stores, as a result customers find

ease of access and facility to buy from them. People filling up when they do their weekly

shopping from supermarkets, often offering a promotional fuel discount linked to amount

of shop purchase.

On other hand forecourt shops are really important contributor to the profitability of a

filling station. When Conveniences and facility come together it creates real attraction

towards customers. Small shops attached to filling stations to buy food and cigarettes are

really helpful a company to keep visiting the filling stations frequently.

This argument also supported by BR. Baker from Energy Institute and MR. Brendan from

Petrolprices.co.uk

4.2.8 Convenience and Price “Best strategy”

Here are combination of factors that could keep customers loyal to any company‟s

products and services. But the most important factors are convenience and competitive

price.

Most of the expert believes that these two factors are most important in retail petroleum

industry. The convenience means that customers have ease of access to filling stations

such as, if customers are on the way to work or home they can get fuel on their route,

customer don‟t need to change to their journey and take other road ahead to filling station.

An additional possible way of Convenience could be on the way to weekly or daily

shopping. Like whenever customers go out for their shopping, same time they can buy fuel

at same s ite. Very good examples are supermarkets.



P a g e | 50

On other hand low price is also very good tool to keep customers flocking to the filling

stations. Whenever a customer visit a station to filing, here might be several reason that

they choice this filling station for filling, like near to home, on the way to job, good

service, no long queue and many other more. But at the same time if the customers found

fuel price less than other filling station it must a cool breath for customer. Those customers

could save little extra more than others.

These two options are really works over the last ten years. Supermarkets tapped in to this

situation and they having very good business in retail petroleum industry. Forecourts shops

are too, in fact have advantages to filling station‟s profit margin as well as keep customers

visiting the site.

This argument is abstracted from MR. Nick Vandervell from UKPIA, “Market research

shows a combination of factors including convenience & price. Supermarkets have tapped

into this trend of people filling up when they do a weekly shop, often offering a

promotional fuel discount linked to amount of shop purchase. For other more regular

daily car travellers filling up more regularly, convenience, price & facilities are important

e.g. café or small shop to buy food or cigarettes as well as fuel. Forecourt shops are a very

important contributor to the profitability of a filling station. Moreover, “most companies

are trying to meet competition by loyalty offers, better quality fuel, standard of sites &

service, as well as being competitive, on price”.

4.2.9 Oil companies’ less interest in retail market

MR. Nick Vandervell from UKPIA, makes his opinion about this issue that, “Some oil

companies have retreated from fuel marketing e.g. Jet & Texaco – and only supply their

branded fuel to sites that are owned by independent fuel retailers. Many oil companies are

wholesale suppliers of gasoline & diesel to supermarkets”.

Here in no doubt that big oil companies are enjoying billions of pounds of profit margin

every year. But the matter of fact they are having very little margin from retail marketing,

particularly in UK.

Here are many reasons in relation to it. Govt taxes on filling stations and other legislation

regarding filling stations make retail petroleum not an attractive business for oil

companies. Because filling stations‟ running cost gone beyond. Whereas oil companies‟



P a g e | 51

real business is selling the oil, consequently they are now looking to different easy ways to

make their business profitable.

MR. Baker said that, “the new trend for oil companies is that, get off from retail petroleum

market and sell these fuels at refineries”.

The fact is that oil companies‟ main business are oil and they want to make it more and

more profitable. To manage a retail site has much less profitable than, a company sold out

its product at the door of refinery. So oil companies are now thinking to reduce the retail

petroleum operations and now they are more willing to sell the oils to whole sellers.

4.2.10 Gasoline Surplus

MR. Nick Vandervell from UKPIA continue his arguments on retail petroleum industry bysaying this,

“The UK has a growing surplus of gasoline because of the growing trend for diesel

powered cars, so supply to supermarkets can be an attractive option to the usual export

route to the USA”.

To sell out this gasoline surplus, supermarkets are very attractive option for oil companies,

rather than the previous one “export route to USA. This trend also powered supermarketsto better perform in market.

4.2.11 Consumer behaviour regarding low prices

The differences between two filling stations fuel‟s prices are very little. Retail petroleum

is very competitive business. Companies are having very little profit margins on petroleum

products. Therefore to make any significant price difference is very difficult to any oil

company. Most of the time difference is only 5-6 pence\litter. As a result if we assume that

a customer has to buy 10 litter petrol or diesel, customer will save only 50-60 pence.

Accordingly it is very less chance that a customer will change their route or wait for t hat

filling station which offers 5 pence less than other, while on journey. Consequently only

“low price” could not be a competitive option for oil marketing companies. To keep

customers loyal, oil companies should have to add some more extra value added services.

Abstracted from: MR. Baker, Energy Institute UK



P a g e | 52

4.2.12 Value added services

Experts suggest that if oil companies are really want to keep themselves in market they

should have to think about some extra value added services to customers. Small

convenience stores, garage attached with filling stations, free oil check, free air pressure

check, these all could be add some extra value to customers‟ spending and could be a

better strategy to keep visiting fuel station on regular basis. Better quality of flues,

standard of sites of services as well as being competitive on price should be core issues be

addressed.

As Nick Vandervell said “Most companies are trying to meet competition by loyalty offers,

better quality fuel, standard of sites & service, as well as being competitive. On price”

Moreover “Aim to have a competitive of fer on fuel, forecourt standard of shop & loyalty

cards”.

Regarding this statement MR. Baker said, “Garages, rest areas and forecourt shops could

be very helpful for a company to retention of customers”



P a g e | 53

4.3 Questionnaire analysis

In this section researcher describe analysis of data which has collected from questionnaire.

It has distributed online and by hand as well. Online distribution counts are about 150 and

researcher received submission about 26 out of 150. By hand survey which has been

distributed by researcher and about 20 people participate. From 20 the researcher selects

only 10. Rest of the ten is rejected because of not completed. Therefore in the end

researcher received 35 responses over all.

The website where researcher creates and distributes survey has facility to analyse final

result and show it by bar graphs with percentage. To make the finding process easy

researcher put the data which is obtained from by hand questionnaire into website and gotmutual final result in shape of bar graphs.

The questionnaire was developed with the name of “Which Fuel Station you more

preferred to GO? In present questionnaire 10 question been asked. Analysis is followed.

4.3.1 Q.NO 1: What are your car or Wagon Make and model?

The first question has been designed to make sure that when a person who is about to fill

this questionnaire have a vehicle like car or wagon. The researcher is showing some of the

names here.

Graph 4.1: Source from Study



P a g e | 54

In this figure 11 to 20 counts has shown and on the right hand site date has mentioned on

which every click been post.

4.3.2 Q. NO 2: What is your car or wagon usage?

Second question was designed to find out the different usages of vehicles from sample

population. In this question here were 5 options. Results are showing below:


64 % of sample population said that, they use their vehicles for home use. 29 % peoples

mentioned that they use vehicles for going to work or offices and only 5 present says that

they use for commercial pick and drop services. 35 persons say for personal use (home

use, for going to work) which is sample population for this research study.

4.3.3 Q No. 3 what type of fuel you use?

In third question researcher‟s aim was to find out that what kind of fuel people are mostly

using for their cars. Here were 3 options and last one is leave for “other” if they used any

other out of three options so could describe. Results are below,




P a g e | 55

Very impressive 86% of sample population go with petrol only 13 % people said diesel.

No result found regarding Gas (LPG) and same with other fuels.

4.3.4 Q NO. 4 How much money you are spending on your fuel consumption every

month?

The fourth question was very important as it‟s provides a clear look about customers‟

spending on fuel consumption every month. These findings will really helpful in

discussion.


The option which given in this question were 10. It starts with £ 100-200 and goes up to £

900-1000 and last option was more than that.

We can see in this graph that mostly sample population is spending £ 100-200 a month. 28

% peoples spending between 200-300 and 12 % people mention that their monthly fuel‟s

spending is £ 300-400. Only 3 % people who got only one submission said that monthly

consumption is £400-500.

Apart from this one person describe that he is spending less then £ 100 for a month.



P a g e | 56

4.3.5 Q NO.5 How often you visit Fuel station for Refilling?

This particular question was designed to find out customers‟ practice that in a week how

many times they visit filling station to get fuels. This question could be very useful toanalysis people‟s conveniences behaviour for petroleum industry.


Here was given 7 options to choose one. 6 % of sample population are visiting fuel station

every day. 36 % customers visit fuel station once in 2 days. This is the most. 15 %

customers take their refill after every 3 days. 12 % customers go to filling station once infour days. 9% customers visiting once in 5 days time period. 3 % customer buy fuel once

in 6 days and second most big figure is 18 % customers which are visiting fuel station once

in a week.



P a g e | 57

4.3.6 Q NO. 6: Please tick that which fuel station Company you more often to Visit?


In 6th question researcher asked that which fuel brand customers like to have for their fuels

needs. Shell is on top with 30%. Sainsbury‟s is stand on second with 21%. Total obtained

3rd position with 18%. BP is having 4th position with 12%. Tesco‟s got 5th with only 9%.

Second last is Esso with 6% and last one is Asda filling stations with 3% of total number.

4.3.7 Q NO. 7: Please tick the best following reason that why you visit this fuel station

This question is very important regarding the study. It will describe best reason that why a

customer like to visit specific filling station. In this question, 13 options have given. Also

will very useful to understand consumer behaviour about petroleum products‟ purchasing

behaviour.



P a g e | 58


Results breakdown

Ranking Reason %

1 Good service 30

2 Near to your home 27

3 Cheap price 15

4 Ease of access 9

5 It is attached with your Supermarket where’s you

often go for shopping

6

6 Staff is friendly 36 On the way to work 3

6 This fuel gives you good mileage 3

6 This fuel enhances your car performance 3

No long queue, on the way to your working route, they have some promotional schemes

like loyalty card etc, these four options not received no result.



P a g e | 59

4.3.8 Q NO. 8: As an overall view which fuel station you more likely to go?

This question is based on an assumption that might be consumers are buying fuel from

other fuel stations because of different reasons as mentioned in last question but they like

any other oil company. It well helps to identify the difference between what consumers

believe and what consumers act.


Consumers like these companies on different basis. This will be discussing in next

question.

30% consumers like Shell, 22 % Sainsbury‟s, 19 % BP, 13 % total, 8 % Tesco‟s, and Esso

and Asda stand same with 2 %.

4.3.9 Q NO. 9: specify the reason

This question related to previous one. And will show the reasons that why consumers like

these companies. It also stands for over all images.



P a g e | 60


Results Breakdown

Ranking Reason %

1 Good service 18

1 Cheap price 18

2 Near to your home 15

3 Staff is friendly 9

4 Ease of access 6

4 They have some promotional schemes like loyalty card

etc

6

5 No long queue 4

5 On the way to your working route 4

5 This fuel gives you good mileage 4

6 On the way to work 2

6 On the way to your working route 2

6 It is attached with your Supermarket where’s you 2



P a g e | 61

often go for shopping

6 Having good looking fuel station 2

6 Related to any Big brand name like BP & Shell or ASDA

& Tesco’s

2

4.3.10 Q No. 10: are you found this Survey short or long?


The researcher tried his best at start that, make this questionnaire easy and short time

taking. And last question was designed to measure that, either researcher achieved this

target or not.

93% of sample population says that, this survey is very short time taking and 6% says

average time taking. No result been received for long time taking, very long time taking

and for unbearable.



P a g e | 62

Chapter 5

Findings‟ Discussion and Results

5.1 Introduction

The present chapter is based on finding‟s discussion and result of the study. The main

purpose of this study was to analysis the impacts of brand development strategies in

context of brand loyalty. Focus of this study was retail petroleum industry in London.

5.2 Re -statement of Research question

How can a company keep their customer loyal towards its products by using

different brand development strategies? Particularly the retail petroleum industry

in London is chosen to find out the impacts of brand and brand development

activities on consumer’s loyalty in presence of widely available less priced

alternatives brands. 5.3 Importance of Brand and Brand development strategies

The researcher reveals that, for any company or organization brands are important.

Especially in retail petroleum industry significance of brand and brand development

strategies are very essential. This argument is supported by, (Tickle, K 2003) and Burnett

and Hutton (2007)

In retail petroleum industry where numbers of companies are offering products, in thistough competition it is very important for a company to maintain its brand image in

market. Especially, when the other business like supermarkets and wholesalers increasing

the number of sites and offering attractive offers to consumers its significance become

more vital.

From primary research (Questionnaire), researcher found that mostly people (30%) still

like to buy Shell products. It is evident that shell is the most popular brand in retail

petroleum industry and its brand development strategies are really time tested and



P a g e | 63

rewarding. The reason behind this purchasing behaviour is described by consumers, is

“good Service” (Questionnaire). Providing good service is also a part of brand

development strategies. This is in line with previous studies that have been reported

(Fritsch. P, 1997)

5.3.1 Brand image is important for brand loyalty

Also researcher found by primary research that good brand image and brand development

strategies are very important for any companies to keep its self in business for long time.

Tesco‟s is selling Super Unleaded 99 Octane, one of the highest-octane petrol available in

the UK (petrolprices.com). On the other hand Tesco‟s brand perception is very poor in

consumer mind. Consumers are considered Tesco‟s a cheap and low quality brand. AS

Olins, 2009 stated that despite of its extra ordinary success, Tesco‟s is unloved and loathed

brand.

Primary research of this study also supports this finding that only 9% people buy from

Tesco‟s filling stations (Questionnaire). The researcher‟s argument is that good brand

developments are very important to attract new customers as well as keep customers loyal.

Although Tesco is selling one of the finest petrol available in UK but Tesco‟s sales are not

very excellent because of its negative brand image.

5.3.2 Responsible company’s brand Image important for brand loyalty

Researcher concluded from primary research that, Responsible company image behind the

brand is very important. As researcher discuss in earlier that shell is investing in society

under its social investment program. Therefore people are having a good brand image in

mind that shell is a good company and consumers like to buy from shell. Moreover this

discussion is supported by Aaker (2004) and (Olins, 2008).

5.3.3 Global Brand Image Helps

The researcher concluded from study that people‟s purchasing behaviour for shell is based

on Shell‟s global brand image.

Shell is having operations all over world. This global brand image also helps Shell to

maintain its sales in retail petroleum industry. This argument is supported by Research

International Observer (RIO) and (Baker, M 2009).



P a g e | 64

5.4 Importance of brand loyal customers

The researcher exposed from primary research that, Oil companies are really concern

about the retention of brand loyal customers. From primary research researcher found that

companies are making different kind of innovative brand development strategies to keep

customers loyal towards brand. Loyalty card, nectar card, club card, low prices, good

service at petrol stations, standards of sites, good looking sites, social investment,

convenience and forecourt shops, these all facts are show that companies in retail

petroleum industry weather oil companies or supermarket for both of them retention of

loyal customers is very important. This discuss is supported by Bannett and Rundle-Thiele

(2005) and experts.

5.5 Easy approach and convenience affects brand loyalty

Researcher concluded from primary research that, easy approach and convenience are

fundamentals to keep customers loyal.

From primary research researcher found that, 27 % of sample population buy petroleum

products from those filling stations which are near to their home. Near to home filling

stations provide real easy approach to filling stations furthermore people do not consider

price in contrast of easy approach. Abstracted from questionnaire and experts‟ opinion

Primary research suggests that diff erence of price between two companies‟ petroleum

product is very nominal. Mostly it‟s only 5-6 pence\litter. And if a customer wants to fill

10 litters of petrol the saving will be 50-60 pence. Regarding this founding customers are

not willing to go furthermore a head to looking particular brand which is available on low

price. Costumes are willing to pay some extra for ease of access.

5.6 Supermarkets’ growth factors: convenience and easy approach

Supermarket penetration in retail petroleum industry is primarily based on convenience.

Primary data of this study shows that Sainsbury‟s is takes place second place with 21%,

where from people preferred to buy petroleum products. The most obvious reason is



P a g e | 65

whenever people go for their shopping they buy petrol or diesel from same place and same

time. Its mean supermarkets are providing real convenience to customers.

Furthermore researcher found from this study that, supermarkets are offering a

promotional fuel discount linked to amount of shopping purchases. This strategy gathered

convenience and extra saving together. These being really helpful for supermarket to

established their self in retail petroleum industry.

5.7 Challenges for oil companies

5.7.1 Fuel taxes, Barriers for oil companies

Primary research explains that government taxes also made retail petroleum industry less

attractive option for oil companies. If a customer is paying 108.9 pence\litter for unleaded

only 30.27 pence is actual product‟s price and other money will go in tax and delivery

charges. We can understand this issue from following figure.

Fig 5.1 Source: Petrolprices.com [Accessed: 15, March, 2010]



P a g e | 66



P a g e | 67

If a customer is paying 109.9 pence\ litters for Diesel, it would split as follow:

Fig 5.2 Source: Petrolprices.com [Accessed: 15, March, 2010]

From above figures, we can easily understand that government taxes having primary share

in current fuel prices. These duty and taxes made very difficult to keep price low of

petroleum fuels products. As primary research bring out that economics of main roadfilling station versus a large supermarket site are very different. The first if large & well

located may sell 5-6 million litters of fuel per year versus a big supermarket site upwards

of 10+ million litres. Supermarkets can afford to accept lower margin on fuel as they have

a large range of product lines within the main supermarket against which to offset the

lower margin on fuel. Consequently oil companies are less able to offer low prices on

fuels.



P a g e | 68

5.7.1 Oil companies can’t provide Convenience

Oil companies are less able to provide convenience to customers. Regarding experts

opinion oil companies are less able to provide that type of convenience which is provided

by supermarkets. Consumers are like to buy from supermarkets because they can buy their

grocery items as well as petrol or diesel at same place. Oil companies‟ main business is

selling oil. For an oil company it is very difficult to pop into grocery business for the sake

of selling their oil products. On other hand for supermarkets, it‟s very easy to get into oil

business as they all ready did. In present scenario, supermarkets are having edge on oil

companies for fuels products selling. This is also supported by retail marketing survey

2009.

5.8 Different factors which affects brand loyalty

Here researcher discusses some key factors which influence consumers to change their

brand loyalty.

5.8.1 Price

From primary research researcher reports that, here is no doubt that for petroleum

products price is not a core issue and consumers are not so much keen about price factors.

But for long term business planning, price is a fundamental issue for a company to keep

customers loyal. If a company selling its products on high price than others, for the time

being it could use different brand development strategies to keep customers loyal but if its

continue high price than competitors , consumer will change their preferences and start

look for other low price alternatives. This argument is supported by Brassington, F &

Pettitt, S 2006, they described consumers for whom price is the primary consideration in

comparing competing offering is said to be price sensitive.

In penetration of supermarkets, continue low price strategy having vital ro le. Researcher

found from primary research that 21% customers like to buy from Sainsbury‟s. Researcher

concluded that price is affecting consumers‟ purchasing behaviour regarding petroleum

products.

On ther other hand this research brigs- out that most people are still using petrol fuel

based vehicles. According to questionnaire 86% using petrol based vehicles. Unleaded is



P a g e | 69

cheaper then diesel in UK. Consumers‟ behaviour about unleaded buying is signif icance

that consumers are affecting by fuels price as well.

5.8.2 PLB (private label Brands)

Researcher brings out from primary research that PLB (private label brands) or generic

brands are really affecting on consumers‟ brand loyalty.

Here are two reasons behind this behaviour. First of all, private labels brands respected a

singles brand image where a single brand image covers wide range of diriment products

and company can offer low price on these products. This is because of many reasons like

it does not face the product development , brand creation and marketing coast that the

manufacturer or other companies who are marketing their own brands facing. This is in

line with previous study which has been reported by Brassington, F & Pettitt, and S 2006.

Secondly PLB are now positioning their brand image as a superior quality than their

competitor‟s brands. The researcher suggests from primary study that private label brand

will grow in future intensively because consumer‟s behaviour about private PLB is

changing positively. For retail petroleum products PLB are showing their strength in

market (questionnaire). As Sainsbury‟s stand on second ranking with 21% where from

people like to buy petroleum products. This discussion is supported by Brassington, F &Pettitt, S 2006, (Riston 2008), (Glynn, Mark S & Shaoshan Chen 2009) and (Kahn, 1998).

5.8.3 Income level

Income level is also very important fundamental in brand loyalty. From primary research,

researcher found that 56% people are spending £100-200 per month on their fuel

consumption. This level of spending shows “middle class income groups” (retail

marketing survey 2009). This income group are really concern for their spending on

essentials. As Glynn, Mark S & Shaoshan Chen 2009 stated that, For retailer point of view

the price consciousness is much important then the value of a private label brands. But

from the manufacturer point of view brand loyalty is much important than the price

sensitivity. In both points of view customer income level is still important and it is very

important to categorize the difference between both of them which could be affects brand

loyalty.



P a g e | 70

5.8.4 Easy approach and convenience

The most important factor which is brought out by researcher from primary research is

that, well located or easy to approach filling stations are really helpful to keep customer

loyal.

Oil markets are still having big share of retail petroleum industry is because of large

number of sites. Oil companies are in retail industry from long time and having almost

5646 sites all over UK. On other hand supermarkets are having 1271 filling stations all

over UK (retail marketing survey 2010). In this means large number of filling stations

provides easy approach to customers.

Fig 5.3 Source: Retail marketing Survey 2010 by Energy Institute

Second most important factor which really affects brand loyalty is convenience. Regarding

UKPIA, supermarkets sales share is 40% in retail petroleum industry. But if we look on

above chart supermarkets are having are having 14.10% of total number of sites. The

difference between numbers of sites is big comparatively total share of sales in market.

The researcher states that, although supermarkets are having very less number of sites

comparatively oil companies are sites, but they are having very significant share in retail

petrol market. This is because convenience. Supermarkets are providing real convenience

to customers and in the results enjoying huge amount of customers‟ loyalty.

61.93%14.10%

12.02%

10.62%

1.33%

Breakdown of UK forecourts by Groups

Oil Companies

Supermarkets

Main retailers(over 20 outlets)

other retailers (under 20

outlets)

other/unbranded



P a g e | 71

Fig 5.4 Source: Retail marketing Survey 2010 by Energy Institute

5.8.5 Parking facility

Parking facility is a very big issue in UK. Enormous numbers of vehicles made this issue

very sensitive. This significant issue also affects rand loyalty. Supermarkets are having

comparatively very big stores and forecourts than oil companies. These big stores areproviding large space for free car park. Where customers could stay for while, doing their

day to day shopping and also buy fuels.

5.8.6 Value added services

The researcher concluded from primary research that some of value added services are also

having significance in brand loyalty. Primary research shows that, some consumers like to

buy fuels from those filling stations staff is friendly. Some people point out that good

quality of fuels also important for them. Moreover some customer point out that good

quality fuels which could enhance vehicle‟s performance, is fundamental factor for their

purchasing.

5.9 Recession Affects on consumers’ purchasing behaviour

The researcher concluded from primary research that, recession has imposed affects on

consumers purchasing behaviour. We can understand this behaviour from following figure.

450

17925416

292

51

14 15

Number Of Outlets at Supermarkets

Tesco

ASDA

Sainsbury's

Somerfield

Morrisons

Other super markets

Waitrose

Co-op



P a g e | 72

Fig 5.5 Source: UKPIA Statistical review 2009

In this researcher shows that after 1970 here is continuous growth in road fuel sales till

2008. In 2008 this growth fall down by two reasons, first high fuel price driven by high

crude oil prices worldwide. The second reason was bad economic condition. This sale fallin petroleum products clearly identify the affects of economic slump on consumer

purchas ing behaviour. As researcher reported earlier that, in recession time consumers

become more fundamental about their spending. Consumers set their priorities in recession

time differently and reduce their spending. (Quelch, John A., Jocz, Katherine E. 2009)



P a g e | 73

5.10 Summary

In above discussion researcher discusses his finding about present study. In discussion, it

is noted that different oil companies are using different kind of brand development

strategies to keep customers loyal towards their brand. Most of these brand deve lopment

strategies are worth full to keep customers loyal but in discussion, researcher shows some

of other aspects as well, which a ffects consumer brand loyalty.

Strong brand and brand development strategies provoke greater attraction to customers and

having positive impacts on consumer-based brand loyalty. Price, convenience, easy

approach to filling stations, value added services, income level of consumers should be

considerable for any company for customers‟ retention and long time sustainability inbusiness.



P a g e | 74

Chapter 6

Conclusion and Recommendations

6.1 Conclusion

This research study has examined the impact on brand development strategies on

consumer-based brand loyalty, in presence of low price alternative brands. Retail

petroleum industry was chosen to analysis this question.

Regarding the objectives of this study, strong brand and brand development strategies

provoke greater attraction and having positive impacts on customer based brand loyalty.

In respect of retail petroleum industry, only brand name and brand development strategies

are not enough to keep customer loyal to brand or products. Many other factors are

considerable to maintain long term customer-based brand loyalty.

The growing share of private label brands (supermarkets) in retail petroleum industry is

alarming condition for oil marketing companies. Oil companies are pushing their selves toboundaries to compete supermarkets by using different strategies. Such as loyalty cards,

better quality fuels, standard of sites and services, as well as being competitive on price.

On other hand, some of oil companies have retreated from fuel marketing and supply their

brand fuels to sites which are owned by independent fuel retailers. The very obvious

reason behind is that, government fuel duty and VAT of fuel products. This fuel duty and

VAT implication are because government want to discourage people to using their cars to

protect the environment. UK fuel duty and tax is six times high then Europe. In November

2008 UK tax on fuel went up 13.53%. AT same time in Austria 2.23% and France and

Germany 2.24%. [Bbc.co.uk Accessed: 17, March, 2010].



P a g e | 75

Fig 6.1 Source: Limited, F 2010. Fuel Tax - PetrolPrices.com [Online]. Available from:

http://www.petrolprices.com/fuel-tax.html [Accessed: 17, March, 2010].

The competition between oil companies and supermarkets, low profit margin in retail fuel

marketing and high cost of maintaining the fuel stations, these all factors made situation

very unfavourable for oil companies to sustain in retail marketing. Therefore, some oil

companies now prefer to sell their branded fuel products on gate of refinery. But these

companies at same time keep their brand image in customer mind they want to keep their

selves in oil business. Business strategy and method could be change over time and place

whether, they want to sale their products by company operated fuel stations, from

independent retailer or by franchises, brand development is their obvious need to develop

consumer based brand loyalty.

Supermarkets are very aggressive in terms of marketing and make new and innovative

strategies to attract more and more customer at all time. The massive competition within

supermarkets reaching bigger day by day, and they almost captured 71.2% retail market of

UK.



P a g e | 76

Fig 6.2 Source: None, 2010. [Online]. Available from:

http://news.bbc.co.uk/1/hi/business/4694974.stm [Accessed: 17, March, 2010].

The battle between supermarkets triggered their selves to make new and innovative

strategies to attract new customers as well as retention of customers. Supermarkets are

supplying basic needs; therefore all consumers are potential customers for these

companies. Tesco‟s slogan “every little help”, Asda slogan “helping you to spend less” and

“every day low price” are the symbol of commitment from supermarkets that they want to

supply every little item which could customer will need in its day to day life. Also

supermarkets‟ target marketing strategy is a symbol to their aim to provide all essential to

every income class.

The start of retail petroleum marketing is one of these innovative strategies, to providemore and better facilities at stores to attract new customer, customer retention and develop

customer based brand loyalty. When first supermarket started its activity in retail

petroleum industry, then the other supermarkets followed same path to maintain

competitive advantages. Supermarkets‟ core business is groceries not selling oil. They

started petroleum business to attract new and more customers not to give competition to oil

marketing companies. They are offering low price on petroleum products to attract

30.60%

16.60%

16.30%

11.10%

5.40%

3.70% 1.80%

Supermarkets' share in UK Retail market

Tesco

Asda

Sainsbury's

Morrisons

Somerfield

Waitrosw

Iceland



P a g e | 77

customers for groceries products. On these item they are having good profit margin

therefore these supermarkets are able to offer low price than oil companies.

The battle between supermarkets affects oil marketing companies as oil companies were

unable to offer low price on fuel products. Oil companies tr ied their best to keep

competitive on price such as Esso and Shell price watch program, but price was not the

only issue, they are facing from supermarkets. Convenience was the core issue in the

growth of supermarkets in retail petroleum industry. Customers could have refill for their

vehicles as they pop into supermarkets for their routine shopping. Price and convenience

came together and became winning combination.

In the respect of product quality, it is not considerable to keep customer loyal towards

brand. The reason is lack of awareness from customer about fuel quality. From primary

research researcher bring out that, Tesco‟s is selling on of finest Unleaded in UK but only

9% sample population is buying from Tesco‟s filling stations even with different reasons,

ease of access. Because Tesco have 450 outlet in UK which is biggest amount of filling

stations from supermarkets. Tesco is unloved brand in UK (Olins 2009) although; it is

selling very good quality fuels. This consumers‟ behaviour about Tesco shows consumers‟

short slightness about fuel quality. From primary research researcher found that, only 3-

4% sample population is buying fuels on the basis of quality or improve vehicle‟s

performance.

And only 6% people are buying fuels from those companies which are having some

loyalty program like fuel loyalty cards or club cards. Therefore loyalty cards and

promotional schemes are not capable enough to keep waether from oil companies or

supermarkets to maintain and gain brand loyalty.

Some experts believe that, here is not enough loyalty existing for petroleum products.

Customers want to buy fuels wherever and whenever they need.

One more very important issue in oil companies‟ brand development strategies is that, all

the major oil companies marketing in UK , they all are global companies and some of

these even having marketing activities in more than 100 countries. In most of developing

countries they don‟t have low price and Private label brand (such as supermarkets)

competition. And in most of countries they create oligopoly condition. The government‟s

policies are also very favourable for these companies as these countries are want to



P a g e | 78

enhance foreign investment and provide very attractive offers to these oil companies in

terms of tax rebate and free land as well. Also in these countries oil companies are having

good profit margin as well. Therefore these oil companies are not too much fussy about to

develop UK retail market. But to keep their image as global brand these companies wa nts

to keep continuing their brand development program all over the world.

Particularly in respect of UK market, UK is Developed country. The customers from

developing countries always look for those brands which are also available in developed

countries. The customers of developing countries get admire and adopted these brands.

As the matter of fact from UK retail petroleum industry, oil companies are not earning

very good profit margin but to keep considerable their selves across border market. They

are continuing their brand development image in UK as well. Global companies and global

brands having some competitive advantages compare than local or small brands. As Ted

Levitt's globalization of markets thesis asserted those global companies and their brand s

would grow inevitably, offering global consumers an unbeatable combination of quality,

availability, reliability and low price. He described a Brand Utopia in which tastes and

needs would become increasingly homogenised, with successful companies focusing on

what 'everyone' wants. (Research International Observer (RIO)

Especially on recession time they provide trust, commitment, satisfaction and value to

customers. These variables make the buying process easy and impose positive effects on

consumer-based brand loyalty.

Private label brand also attached with some brand name such as Asda petroleum products

are attached with Asda brand name. Therefore, these companies are also very keen about

brand name and brand developing strategies as low price is also a brand developing

strategy.

Brand loyalty is very powerful barrier against competition and a powerful tool to gain

customer satisfaction and customer retention through repeat purchase. Brand loyalty

provides trust, commitment, satisfaction, and value to customers and makes purchasing

process easy. While some other factors such as convenience, price, and perceived brand

value could affects customer based brand loyalty.



P a g e | 79

In the end, the findings of this research study demonstrate that brand and brand

development strategies are important for any company to keep itself in business for long

time. But along all of these strategies convenience, ease of access and price also very

important to keep customer loyal towards any brand. In the respect of retail petroleum

industry in UK it is very important for any oil marketing company that, they have to

implement those business strategies where convenience, ease of access and price should be

consider as prime objectives.

6.2 Recommendations

Here is no doubt that brand and brand loyalty is very important for any company to gain

competitive advantages in market. Loyal customers are most valuable assists for any

organization. But to keep customer loyal, only brand development strategies are not

enough. While some other factors such as convenience, price, and perceived brand value

could affects customer based brand loyalty. In respect of retail petroleum industry, the

researcher has suggested following recommendation.

Oil marketing companies should have to focus on their loyalty programs for revise

them and make some standards to measure loyalty by these programs. (see: section

5.3 and 5.4)

Organization should have to do critical analysis about their brand development

resources to clearly understand that these resources are producing enough brand

loyalty. ( see: section 5.3 and 5.4)

Site locations should be primary consideration for any oil marketing company.(

see: section 5.5, 5.6 and 5.8)

Oil companies should have to develop well located sites which could provide easy

approach to customers. ( see : section 5.5, 5.6 and 5.8.4)

52 % motorway petroleum sites are acquired by BP that is very good strategy for

an oil company to present itself easily approachable to customers. Therefore Oil

marketing companies should locate their sites on busy routes such as motorways,

from where large numbers of vehicles are passing. It would increase the chances of

customer visiting their sites for refilling. ( see: section 5.5, 5.6, 5.8.4 and

appendices)



P a g e | 80

Big fuel stations with extra nozzles could be very useful to minimise the running

cost of fuel stations, reduction of long queues as well as improvement of standards

of services providing at petrol satiations. (See: section 6.1 also Figure 6.1)

Oil companies should have to invest heavily on Bio fuels as well as other energy

alternatives such as solar and electric. ( personal opinion and see: 2.7 and 2.7.1)

Oil companies should have to more focus on cross border business, especially in

developing countries where they have less competition and also government

policies are favourable for them. Such as India, Pakistan and some African

countries. (personal opinion and see: 6.1)

To compete the super market oil companies should have to compromise on profit

margin ratio and have to more focus on business expansion. ( see: section 5.5,5.6

and 5.8.4 also 6.1)



P a g e | 81

6.3 Further research suggestion

The researcher aims was to analysis different brand development strategies and their

impacts on customer based brand loyalty, in the presence of low price alternative brands.

The focus industry was retail petroleum industry in UK. The researcher put best of his

efforts to accomplish this target.

There are some core issues which are needed to be addressed in future by focusing on

empirical analysis. Such as brand switching behaviour. Also the direct link between

customer satisfaction and brand loyalty are still ambiguous. Demographic affects on brand

loyalty and brand switching behaviour could be very vital subject for research.



P a g e | 82

References

(M. Riston, 2008) Marketing (00253650); 1/9/2008, p20-20, Emerald Group

Publishing Limited

Aaker, D 2004, Brand portfolio strategy: creating relevance, differentiation,

energy, leverage and clarity, Simon & Schuster , London page 285

Aaker, D 2004, Brand portfolio strategy: creating relevance, differentiation,

energy, leverage and clarity, Simon & Schuster , London page 268

Aaker, D. & Alvarez del Blanco, R. (1994) „Capitalizar el valor de la marca?‟

Harvard Deusto Business Review,

Aaker, D. A. (1991) „Managing Brand Equity: Capitalizing on the Value of a

Brand Name‟, The Free Press, New York.

Aaker, D.A. and Jacobson, R. (1994), „The financial information content of

perceived quality‟, Journal of Marketing

Akshay R. Rao and Kent B. Monroe, Journal of Marketing Research, Vol. 26, No.

3 (Aug., 1989), pp. 351-357 , American Marketing Association

ASDA, 2010. Online Grocery Shopping, ASDA Direct, George and more at

Asda.com [Online]. Available from: http://www.asda.co.uk/corp/home.html

[Accessed: 17, March, 2010].

Associates, L 2010. Landor: Our Work: BP: Moving beyond on a global scale

[Online]. Available from:

http://www.landor.com/?do=ourwork.casehistory&cn=1961 [Accessed: 10, March,

2010].

Bennett, R.and Rundle-Thiele,S.(2005) The Brand Loyalty Life Cycle: Implication

Brand Management, Vol. 12 No. 7, MCB UP Limited.

Brassington, F & Pettitt, S 2006, Principles of marketing, Financial Times

Management, London, P- 311









P a g e | 83

Burnett, J. and Hutton, R. B. (2007) „New consumers need new brands‟, Journal of

Product & Brand Management. Vol.

Calderon H. et al. (1997) „Brand Assessment‟, Journal of Product & Brand

Management, Vol. 6 No. 5, pp. 293-304.

Cartwright R. (2002) Mastering Market Management, 1st edition, Palgrave

Publishers.

Chernatony, L D & McDonald, M 2003, Creating powerful brands in consumer,

service and industrial markets, Butterworth-Heinemann

Chernatony, Leslie De,Knox, Simon, Chedgey, Mark: European Journal of

Marketing; 1992, Vol. 26 Issue 2, p5, 10p, 5 charts

Clifton, R & Blackett, T 2009, Brands and Branding, Second Edition (Economist

Books), Bloomberg Press London, p-13

Clifton, R 2009, Brands and Branding, Second Edition, Economist Books, London,

page, 13-15

De Chernatony, L & McDonald, M 2003, Creating powerful brands, Third Edition,

Oxford ; Elsevier/Butterworth-Heinemann, p- 36-39

Denny, N. (1998) Listening to your Customer is Vital; Marketing 19 November,

p.18.

Gill, J & Johnson, P 2002, Research methods for managers, Sage, London

Glynn, Mark S.; Shaoshan Chen. International Journal of Retail & Distribution

Management, 2009, Vol. 37 Issue 11, p896-914, 19p, 5 charts; DOI:

10.1108/09590650910999343; (AN 47327378)

Green Car Comparison Site, the Latest News and Reviews from the UK [Online].

Available from: ww.greencarsite.co.uk [Accessed: 17, October, 2009]

Hallberg, Garth, 2004, Journal of Targeting, Measurement & Analysis for

Marketing; Mar2004, Vol. 12 Issue 3, p231-241

Herbig, P. & Milewicz, J. (1997) „The relationship of reputation and credibility to

brand success‟, Pricing

HOW TO MARKET IN A DOWNTURN. By: Quelch, John A., Jocz, Katherine

E., Harvard Business Review, 00178012, Apr2009, Vol. 87, Issue 4

INM, 2010. Shell to close petrol stations as supermarkets step up price war -

Business News, Business - The Independent [Online]. Available from:



P a g e | 84

http://www.independent.co.uk/news/business/news/shell-to-close-petrol-stations-

as-supermarkets-step-up-price-war-712037.html [Accessed: 23, February, 2010].

Internet, F 2010. Petrol and Oil Company Road maps from the Great Britain - UK

petrol roadmaps [Online]. Available from: http://www.ianbyrne.free-

online.co.uk/country/maps-gb.htm [Accessed: 9, February, 2010].

Kahn, B.(1998)'Marketing Master: Part four. Brand Strategy; Financial Time

Supplement, pp.4-6.

Kay, M. J. (2006) „Strong brands and corporate brands‟, European- Journal of

Marketing, Vol. 40 No. 7/8, pp. 742-760.

Keller, K 2007, Strategic Brand Management, Pearson Education, 3rd edition

Upper Saddle river, p,172-173

Keller, K 2008, Strategic brand management: building, measuring, and managing

brand equity, Pearson/Prentice Hall , Upper Saddle River, N.J, p-43-45

Limited, F 2010. Fuel Tax - PetrolPrices.com [Online]. Available from:

http://www.petrolprices.com/fuel-tax.html [Accessed: 17, March, 2010].

Marketing (00253650); 4/22/2009, p22-22, 1p

Marketing Research, Vol. 31 No. 2, pp. 191-201.

Martin Lindstrom, 2005, Brand Sense, Kogan Page Ltd, p, 167

Martinez E. & Pina J. M. (2003) „The negative impact of brand extensions on

brand image‟, Journal of Product and

Miller, J. and Muir, D. (2004) „The Business of Brands in England‟, John Wiley &

Sons Ltd. xi, pp. 109-110.

Miranda, J. M. and Konya, L. (2007) „Customisation, moving customers away

from the dull conformity of brand loyalty‟ Vol. 17 No. 4, pp. 449-466. Emerald

Group Publishing Limited.

Neill, J 2010. Qualitative Research I - Lecture Notes - James Neill [Online].

Available from:

http://wilderdom.com/OEcourses/PROFLIT/Class6Qualitative1.htm#Types

[Accessed: 22, March, 2010].

None, 2010. [Online]. Available from:

http://news.bbc.co.uk/1/hi/business/4694974.stm [Accessed: 17, March, 2010].

Olins,W 2008, “Wally Olins: The Brand Handbook", Thames & Hudson, London,

p,14



P a g e | 85

Palmer, A. (2004) „Introduction to Marketing‟, theory and practice, Oxford

University Press. pp. 87-120

Retail Marketing Survey, 2009. A Special Supplement to Petroleum Review,

published by: Energy Institute UK, Mar 2009

Retail Marketing Survey, 2010. A Special Supplement to Petroleum Review,

published by: Energy Institute UK, Mar 2010

Ritson,Mark1 , Should You Launch a Fighter Brand?, Harvard Business Review;

Oct2009, Vol. 87 Issue 10, p86-94, 9p,

S Brassington, F & Pettitt, S 2006, Principles of marketing, Financial Times


Saunders, M & Lewis, P & Thornhill, A 2007, Research methods for bus iness

students, Harlow, England ; New York : Financial Times/Prentice Hall,

Segura Inc. 2010. BP | Cartype [Online]. Available from:

http://www.cartype.com/pages/387/bp [Accessed: 10, March, 2010].

Shell International Petroleum Company Ltd Trading As: Shell International

Petroleum Company Ltd 2010. UK Social Investment - United Kingdom [Online].

Available from:

http://www.shell.co.uk/home/content/gbr/responsible_energy/shell_in_the_society/

social_investment/ [Accessed: 23, February, 2010].

Solman,Gregory , Coloring Public Opinion? , 1/14/2008, Vol. 49 Issue 2, p22-24, 3

Strategy & Practice, Volume 5 No. 1, pp. 25– 29 MCB- University Press.

Travel Trade Gazette UK & Ireland; 3/20/2009, Issue 2859, p12-12, 1/4p

UKPIA Statistica l Review 2009, Online Available from

http://www.ukpia.com/Portals/0/Repository/Documents/Newsletters/UKPIA%20st

atistical%20Review%202009.pdf [Accessed: 10, January, 2010].

Wind, Y. (1982) Product Policy and Concept, Method and Strategy, addison-

wesley



P a g e | 86

Appendices “A”

Blank copy of QuestionnaireWe are conducting an academic research about “Brand Loyalty in Retail petroleum

products” you are requested to devote some of your precious moments to answer these

questions. Your support and co-operation are crucial for the quality of research. There is

no right or wrong answer, please make your own judgements. The information provided

will be kept secret. The researcher is grateful for your co-operation.

Laeeq Ud Din Qureshi

School of Technology and Management

Student ID: 0544BABA0409

E-mail: [email protected]

Mobile: +44 79 43460350

mailto:[email protected]






P a g e | 87

Which Fuel Station you more

preferred to go?

1: what is your car or wagon make and model?

Make:

Model:

2: What is your car or wagon usage?

a) Home use

b) For going to your work

c) Taxi or mini cab driver

d) Pick and drop services

e) Goods transferring

3: What is your fuel type?

a) Petrol

b) Diesel

c) LPG

d) Other

4: How much money you are spending on your fuel consumption every month?

a) £ 10-100

b) £ 100 -200

c) £ 200-300

d) £ 300-400

e) £ 400-500

f) £ 500-600

g) £ 600-700

h) £ 700-800

i) £ 800-900



P a g e | 88

j) £ 900-1000

k) More than that

5: How often you visit Fuel station for Refilling?

a) Every day

b) once in couple of days

c) once in 3 days

d) once in 4 days

e) once in 5 days

f) once in 6 days

g) once in a Week

6: Please tick that which fuel station Company you more often to Visit?

a) BP

b) Shell

c) Total

d) Esso

e) Texaco

f) Tesco‟s fuel station

g) Asda „s fuel station

h) Sainsbury‟s fuel station

i) Morrison‟s fuel station

j) Gulf petrol station

7: please tick the best following reason that why you visit this fuel station

a) Good service

b) No long queue

c) Cheap Price

d) Staff is friendly

e) Ease of access

f) Near to your home

g) On the way to work

h) On the way to your working route



P a g e | 89

i) This fuel(petrol, diesel, gas ) gives you good mileage

j) This fuel enhances your car performance

k) They have some promotional schemes like loyalty card etc

l) It is attached with your Supermarket where‟s you o ften go for shopping

8: As overall view which fuel station you more likely to go?

a) BP

b) Shell

c) Total

d) Esso

e) Texaco

f) Tesco‟s fuel station

g) Asda „s fuel station

h) Sainsbury‟s fuel station

i) Morrison‟s fuel station

j) Gulf petrol station

9: specify the reason

a) Good service

b) No long queue

c) Cheap Price

d) Staff is friendly

e) Ease of access

f) Near to your home

g) On the way to work

h) On the way to your working route

i) This fuel(petrol, diesel, gas ) gives you good mileage

j) This fuel enhances your car performance

k) They have some promotional schemes like loyalty card etc

l) It is attached with your Supermarket where‟s you often go for shopping

m) Having good looking fuel station

n) Related to any Big brand name like BP & Shell or ASDA & Tesco‟s



P a g e | 90

10: How you found this survey

a) Short time taking

b) Average time taking

c) Long time taking

d) Very long time taking

e) Unbearable

Thanks for your cooperation.



P a g e | 91

Blank copy of Online Questionnaire

Which Fuel Station you more preferred to GO?

What is your car or Wagon make and model?

What is your car or wagon usage?

Home use

For going to your work

Taxi or mini cab driver

Pick and drop services

Goods transferring

What is your fuel type?

Petrol

Diesel

Gas

other

How much money you are spending on your fuel consumption every month?

£ 100 -200

£ 200-300

£ 300-400

£ 400-500

£ 500-600

£ 600-700

£ 700-800

£ 800-900

£ 900-1000



P a g e | 92

More than that

How often you visit Fuel station for Refilling?

Every day

once in couple of days

once in 3 days

once in 4 days

once in 5 days

once in 6 days

once in a Week

Please tick that which fuel station Company you more often to Visit?

BP

Shell

Total

Esso

Texaco

Tesco‟s fuel station

Asda „s f uel station

Sainsbury‟s fuel station

Morrison‟s fuel station

Gulf petrol station

other

please tick the best following reason that why you visit this fuel station

Good service

No long queue

Cheap Price

Staff is friendly

Ease of access

Near to your home

On the way to work

On the way to your working routeThis fuel gives you good mileage



P a g e | 93

This fuel enhances your car performance

They have some promotional schemes like loyalty card etc

It is attached with your Supermarket where‟s you often go for shopping

other

As a overall view which fuel station you more likely to go?

BP

Shell

Total

Esso

Texaco

Tesco‟s fuel station

Asda „s fuel station

Sainsbury‟s fuel station

Morrison‟s fuel station

Gulf petrol station

other

specify the reason

Good service

No long queue

Cheap Price

Staff is friendly

Ease of access

Near to your home

On the way to work

On the way to your working route

This fuel gives you good mileage

This fuel enhances your car performance

They have some promotional schemes like loyalty card etc

It is attached with your Supermarket where‟s you often go for shopping

Having good looking fuel stationRelated to any Big brand name like BP & Shell or ASDA & Tesco‟s



P a g e | 94

other

Are you found this survey

Short time taking

Average time taking

Long time taking

Very long time taking

Unbearable

Submit

Copyright 2009 Intellibahn LLC Questions or comments? Contact Us.

Please see our Terms and Conditions for use of our services or website.

http://www.surveybob.com/surveybob/contact.html



http://www.surveybob.com/surveybob/terms.html







P a g e | 95

Appendix “B”

Blank copy of semi structuredinterview

1. Do you think that brand image is important for any company?

2. How do you perceive that brand development strategies are in the benefits of an oilcompany?

3. How can oil companies could address competitions confronting from supermarkets insense of less price as well as these stores are “easy to access” to customers?

4. Increasing share of supermarkets is a alarming situation for oil companies and nowthey are having 40% share of retail market (According to UKPIA), in future do youthink that these oil companies will sweep up from market?

5. Do customers really take care about fuel price, regarding to our survey mostly people

says that we buy fuel on the way to our work, home or where ever we needs and pricereally doesn‟t matter.

6. Big companies like shell, BP and total, do you think that these big brand name arereally helpful to keep their customers loyal towards their products in presents scenariowhen supermarkets are in markets with low price fuel products.

7. All most all companies are very care full their brand development and to keep theirself in market for long time, do you think that all these brand development strategies

are really helpful for fuel companies to keep their customers loyal OR if a companyonly offer less price it could be a winning offer?

8. Last thing which is that, do you consider that customers really affected by recession?

And they changes their brand which there were used and now they are really lookingfor less priced alternatives reduced their consumption

9. What kind of new strategies a company should have to adopt to maintain and gaincustomer based brand loyalty?

10. What things made customer to change its brand loyalty? And is there any impactsfrom rival company‟s brand development strategies on customer‟s loyalty

11. Any suggestion for oil companies for future brand development strategies?



P a g e | 97

All praises and thanks be to Allah, Lord of everything that exists. The most

Gracious, the Most Merciful. Master of the Day of Judgment You (alone) we

worship, and You (alone) we ask for help. Guide us to the Straight Way The

Way of those on whom You have bestowed Your Grace, not (the way) of those

who earned Your Anger, nor those who went astray.

Ameen

LAEEQ QURES HI

HI MR. Nick Vandervell

My name is Laeeq Qureshi; I am student of MBA in School of Technology and management

London.

I m doing research on Retail petroleum industry in the context of that how a petroleum

company could keep its customer Loyal towards its retail products like Petrol, diesel and

LPG in the presence of cheap priced alternative like Supermarket petrol stations as well as, in

recession when it believed, that people have less buying power them before.

Regarding to our telephonic conversation in which you give me your e-mail address, I am

sending you some statements; I would like to get your opinion about present study. I prepared

a questioner as well to find out this. (Link attached)

Q: How can oil companies could address competitions confronting from supermarkets in

sense of less price as well as these stores are “easy to access” to customers?

Ans: Most companies are trying to meet competition by loyalty offers, better quality

fuel, s tandard of sites & service, as well as being competitive. On price



P a g e | 98

Q: Increasing share of supermarkets is an alarming situation for oil companies and now they

are having 40% share of retail market (According to UKPIA), in future do you think that

these oil companies will sweep up from market?

Ans: Some oil cos have retreated from fuel marketing eg Jet & Texaco – and only supply their

branded fuel to sites that are owned by independent fuel retailers. Many oil cos are wholesale

suppliers of gasoline & diesel to supermarkets. The UK has a growing surplus of gasoline

because of the growing trend for diesel powered cars, so supply to supermarkets can be an

attractive option to the usual export route to the USA.

Q: Do customers really take care about fuel price, regarding to our survey mostly people

says that we buy fuel on the way to our work, home or where ever we needs and price really

doesn‟t matter.

Ans: Market research shows a combination of factors including convenience & price.

Supermarkets have tapped into this trend of people filling up when they do a weekly

shop, often offering a promotional fuel discount linked to amount of shop purchase. For

other more regular daily car travellers filling up more regularly, convenience, price &

facilities are important eg café or small shop to buy food or cigarettes as well as fuel.

Forecourt shops are a very important contributor to the profitability of a filling station.

Q: Big companies like Shell, BP and Total, do you think that these big brand names are

really helpful to keep their customers loyal towards their products in presents scenario when

supermarkets are in markets.

Ans: Aim to have a competitive offer on fuel, forecourt standards, shop & loyalty cards

All most all companies are very care full their brand development and to keep their self in

market for long time, do you think so that all these brand development are really helpful for

fuel companies to keep their customers loyal OR if a company only offer less price it could

be a winner company for market.

Q: Economics of main road filling station vs a large supermarket site are very different.

The first if large & well located may sell 5-6 million lts of fuel per year vs a big

supermarket site upwards of 10+ million litres . Supers can afford to accept lower

margin on fuel as they have a large range of product lines within the main supermarket

against which to offset the lower margin on fuel. However, there are signs that some



P a g e | 99

supermarkets are becoming less aggressive on their fuel pricing because the recession

has meant they have had to be more competitive on main food offering. They have also

branched out into other activities including insurance, credit cards etc

Q: How UKPIA is helpful to petrol companies to protect their interest in retail market as

these companies and supermarket oil distributions mutually are the members of UKPIA.

Ans: UKPIA doesn’t have any supermarkets as members. Our focus is mainly on

refining side. We have no commercial lobbying role on retail side or pricing because of

competition law considerations.

Last think which is that do you consider that customers really affected by recession? And

they changes their brand which there were used and now they are really looking for less

priced alternatives or they reduced their consumption.

Q: Fuel demand is down about 5-6% in volume terms since the start of the recession.

Looking at Govt DfT data, there are signs that people are driving less & perhaps

cutting speed.

As regarding to your suggestion I met MR. Baker from Energy Institute and he give me really

value able information regarding this study. Thanks for your suggestion as well.

It will be so kind of you to receive you opinion about these statements. If you have any data

which is regarded to this study and you could provide us please attached whit it. Also, give

your opinion about the significance of study.

Mr. Vandervell Thanks a lot for your Cooperation.

KIND Regards

Laeeq qureshi

“I have created a survey and would like to get your input. Please click on the link in this

email and complete the survey. Thanks!”

http://www.surveybob.com/surveybob/s/b5750f04-dece-4d43-8903-fca6beef5ee7.html






P a g e | 100

Appendices “D”

Source: Retail Marketing Survey by Energy Institute 2010

Source: Retail Marketing Survey by Energy Institute 2010

51.26%

30.25%

11.77%

5.04% 5.04%

Motorway Sites- Brand of Petrol sold

BP

Shell

Esso

Total

Texaco

51.26%

30.25%

11.77%

5.04% 5.04%

Motorway Sites- Brand of DERV sold

BP

Shell

Esso

Total

Texaco



P a g e | 101

Appendices “E”

When BP was the so le distr ibuter of Shell‟s products

Fuel crisis lacks any issues management « Heather Yaxley – Greenbanana views of

public relations and more [Online]. Available from:

http://greenbanana.wordpress.com [Accessed: 27, March, 2010].

THE TOP 10 Brands and their rankings 2009

NO Name Ranking1 Google 1

2 GE 2

3 Microsoft 3

4 Coca-cola 4

5 China Mobile 5

6 IBM 6

7 Apple 7

8 McDonald's 8

http://greenbanana.wordpress.com/

