Oil firms in expansion mode

NEW DELHI: With disinvestment clouds clearing, state- owned oil marketing companies have drawn up aggressive marketing plans to expand their turfs by creating formidable entry barriers for their private sector rivals.
While market leader IndianOil Corporation has gone for branding and changing visual identity of its retail outlets, sister concern Bharat Petroleum has unveiled a major thrust on capturing the high- volume highways market.
"We will launch 1,000 outlets, called Xtra Branded, where fuel quality, quantity and services would be certified by international agencies," IndianOil marketing director N G Kannan said.
Simultaneously, IOC is changing the colour scheme of its outlets from rainbow colours to orange and blue for giving them "a distinct visual identity".
Kannan said the revamp goes beyond visuals. Being done under the sub-brand IndianOilXtra, the upgrade will include additional facilities in terms of customer service. The company plans to take its total strength beyond 10,000 by the year-end from the present 9,155.
Kannan said two advertising agencies have been given the task to create separate branding strategy for motor fuels and cooking gas.
Kannan said with its 3,000 outlets, IBP, merged with IOC, has been gaining retail marketshare at the expense of other players like Bharat Petroleum and Hindustan Petroleum.
IOC commanded 34.3 per cent market share of petrol sales in 2003-04 (33.7 per cent in 2002-03), while IBP had 9 per cent (7.8 per cent in 2002-03). In diesel sales, IOC has 38.4 per cent market share while IBP has 11.2 per cent.
He said despite 2,500 petrol stations being added in 2003-04, IOC''s per pump throughput (sales) has increased.
In April, IOC, on an average, sold 40 kilolitres per month of petrol and 149 kl per month of diesel from its pumps. The corresponding figures for the previous fiscal were 40 kl of petrol and 129 kl of diesel per month.
The other players have registered a fall in per pump thru put. The industry average was 45 kl of petrol per month and 150 kl of diesel per month in April 2004.