CITGO Marketers' Wish List

Published in CSP Daily News

Outlines changes they want to see in refiner's marketing policies

By  Carole Donoghue, Petroleum Editor

HOUSTON -- CITGO marketers have drawn up a wish list of marketing changes they'd like to see next year, and the company's marketing executives have promised to try to deliver at least some of them. The company's wholesalers outlined the revamps they'd like to see at a jobber council meeting, sources told CSP Daily News.

Among the items on their list:

Concern about image standards at new sites. Some stations being added to CITGO's retail string are not meeting existing image standards, jobbers complain. New sites should meet or exceed the typical image standards in a given market, they said. They also want CITGO to adopt specific noncompliance penalties for marketers who fail mystery shop inspections.

CITGO has been testing a new shopper program and was due set up a third round of tests in Illinois. Marketers suggested changes in the questions shoppers ask, along with a rethink of test scoring and a tweak of requirements for point-of-purchase (POP) materials and credit card application holders. Marketer feedback will be used to "fine-tune" the program before it is rolled out in January next year, CITGO promised.

Better communication with marketers. Like some other suppliers, CITGO uses DTN to notify its marketers of upcoming pricing and supply changes but jobbers say that can pose a challenge when weekend and holiday updates are involved. CITGO said it will ask marketers to provide individual email addresses for designated recipients for DTN messages, but not for prices. CITGO told wholesalers that it will explore ways to initiate DTN notifications around the clock, 24/7. The refiner's IT department also is looking at ways to communicate directly with iPhones and iPads.

A better loyalty offer. CITGO has been meeting with marketers and outside loyalty experts to develop a voluntary loyalty initiative for its retailers that they could "customize" to meet individual needs. Marketers told executives that the program should include a simplified summary that clarifies costs and rewards, an ROI breakout analysis, and examples of a location's fee structure and implementation timeline. Currently, CITGO marketers about able to create their own loyalty program through third-party vendor Centego.

Improved delivery of image materials. CITGO unveiled a reimaging program in January this year designed to smarten up its profile on the street. So far, about 22% of CITGO's nearly 6,000 branded stations have ordered the "Centennial" image materials but there have been concerns about the timeliness in which they're delivered. Additionally, some items, such as valance packages, are damaged in transit while other material doesn't arrive at all. CITGO said it is adding new labeling with handling instructions for the freight company.

Problems with ultra-low-sulfur diesel. Some marketers are experiencing bacteria growth in retail ULSD tanks that is requiring expensive treatments to handle. CITGO told the jobber council that it will monitor the situation and its internal quality control department will work with the additive company that it uses to see if an anti-bacterial agent can be added to its premium diesel.

Prior warning of new CITGO sites. Wholesalers complained that CITGO sometimes decides to brand a station without any warning to existing CITGO retailers in the relevant market. In a bid to avoid further brand conflicts, CITGO has promised that its regional managers will stress the need for each territory manager to advise all impacted marketers of any new branding activity.

Meanwhile, CITGO has told marketers that it is beating industry trends when it comes to volume. Volume industry-wide was down slightly during the first nine months of 2011, but CITGO projects it will see higher sales in 2012. There has been an increase in overall volume from new branding versus volume lost by debranding, company officials told marketers.

"Fresh off of a meeting earlier this month, the Council has provided some great insights that CITGO will further explore to determine how best to meet your business needs," CITGO told marketers.