Lights Out for BP's ampm
Published in CSP Daily News
Oil company pulls franchise east of Rockies after selling West Coast sites
HOUSTON -- It seems BP has too much good stuff. After five years of pushing its West Coast ampm brand across the country, the major oil company appears to be pulling the plug on its franchise in markets east of the Rockies, informing retailers of the decision earlier this week.
The news follows the sale announced last week of BP's Southern California refinery and marketing business, along with its West Coast ampm franchise, to San Antonio-based Tesoro Corp. (see Related Content below for previous coverage).
Attempts to get BP to comment by press time were unsuccessful; however, CSP Daily News was able to confirm the announcement through three retailer sources, all of whom asked to remain anonymous at this time.
As reported late Thursday in a Raymond James/CSP Daily News Flash, a Midwest retailer said he needed to change the convenience store name as quickly as possible so he wouldn't have to continue to pay royalty fees. A second Midwest retailer said his job description had changed to where his new priority is to find another c-store brand.
"ampm didn't really work east of the Rockies," the first retailer told CSP Daily News. "ampm originated on the West Coast with ARCO, a low-cost leader in fuel. It was geared toward that type of customer. East of the Rockies, BP is a premium brand."
BP had a history of c-store misfires, inclusive of its "BP Connect" and "Wild Bean Cafe" concepts, the latter of which was to have brought a more upscale, foodservice feel to its c-store offer. That program gave way to the decision to go with the ampm brand and the franchising model itself.
At the time, 700 locations were up for divestment, with 500 to 600 targeted for franchising, officials told CSP magazine in 2008. Since then, BP spent millions in TV advertising, billboards and professional sports-team sponsorships to build the brand in markets like Atlanta, Chicago, Cleveland, Pittsburgh and Orlando. But retailers said it was a doomed attempt.
"The POS [point of sale] clearly never worked from the start," the first retailer said. "The promotional calendar didn't work well. It was a combination of a discount c-store brand with a premium fuel. It didn't work."
Some would argue that the demise of ampm east of the Rockies was already a done deal. In 2009-2010, lawsuits that sprung up in markets like Indianapolis resulted in retailers being able to come out from under the ampm brand, despite having just purchased the retail assets from BP in those major metro areas. In Pittsburgh, a dealer at a former ampm site said almost 40 locations there were debranded about eight months ago without any fanfare. Then in Florida, the Orlando ampm retailer there just this month sold 29 stores of his 32 locations to Laval, Quebec-based Alimentation Couche-Tard, which intends to operate the stores as Circle K.
When BP had initially decided to push the brand east, it had developed a major marketing push tied around the slogan, "You can never have too much good stuff." In its commercials, college-age men wandered store aisles, finding themselves mesmerized by how many items they wanted. At the end of the commercial, the man would ask the cashier, "Do you have a cart?"
In Chicago, billboards and bus-stop shelters with three-dimensional products carried the "good stuff" theme, as did messaging tied to its sponsorship of cross-town baseball games between the town's Cubs and Sox teams.
(See Related Content below for previousCSP Daily News coverage of BP, ampm and ARCO.)
Houston-based BP markets more than 15 billion gallons of gasoline every year to U.S. consumers through more than 11,000 branded retail outlets and supplies more than four billion gallons of fuel annually to fleets, industrial users, auto and truck manufacturers, railroads and utilities. BP is the single, global brand formed by the combination of the former British Petroleum, Amoco, Atlantic Richfield (ARCO) and Burmah Castrol. BP is a global producer, manufacturer and marketer of oil, gas, chemicals and renewable energy sources.