But what of the BP gasoline brand? Can it withstand the public-relations disaster of the 4.9 million barrels of oil leaked from the well, and is a return to the Amoco brand a step in the right direction? BP retailers and analysts debate the pros and cons.
Since the Gulf oil spill, [image-nocss] there have been protests and vandalism at some stations, and others have seen their business decline, according to a report from National Public Radio. As a result, independent stations are going out of their way to tell customers they are not owned by BP.
(Click here for previous CSP Daily News coverage of the BP spill and its effect on the brand and its retailers.)
There are signsboth on the convenience store and at the pumpsspelling it out, NPR reported. And BP said it is spending $60 million to help stationsoffering cash incentives, reducing credit-card fees and paying for a media campaign. One of the ads from that campaign asks: "Have you ever met the owner of a BP station? Chances are you have. Most BP stations are locally owned and operated. So that guy that gave you directions, he might be the owner."
Still, many stations across the country have seen their business drop off.
"We've seen about an 8% to 12% decline," Tom Bower, president of Clipper Petroleum in Georgia, told NPR.
He operates 34 BP stations in the state and supplies 160. His stations bore the Amoco name for decades. He said it's too early to say whether making any changes now would help.
"We love that Amoco brand. But it's been gone for what, 10, 12 years now? I'd have to study a little bit more on it to decide whether that'd be a good thing to do. You know, when you've been gone for a while, people tend to forget," Bower said.
Ray Baird of RiechesBaird, a specialist in marketing strategy and corporate branding, says a simple name change is not likely the cure.
"I think from a business standpoint...just switching a name for the sake of switching a name is not a good idea. Consumers can really kind of see through that," Baird told NPR.
He added that BP may want to research using a new sub-brand like Amoco but that given the right communication and corporate response, the BP name can recovereventually.
"I don't think it's going to be forgotten by the individuals today that are being affected by it. But the generations behind thatyou know as they grow inhow will they understand what BP does? I think that is significant to the longevity of that overall brand," Baird said.
Other analysts generally agreed.
"[Rebranding] would obviously be expensive and you would potentially lose some of the momentum that company has built up over the years," said Tim Hanson, an analyst with the Motley Fool, during a recent Motley Fool Money Radio Show. "I think the company deserves some credit going forward for the way they have gotten the skimmers down there, the way they have now shut off the well, and according to a recent report, a lot of the oil has actually either been dispersed or cleaned up. So BP deserves some credit for that, and BP could actually end up gaining some brand equity if they play their cards right."
Another Motley Fool analyst, James Early, said two months ago, the rebranding seemed like a fait accompli. Today, not so much.
"It seemed like a savvy move at the time. People were out on Twitter, on the Internet and the newspapers, on every news show criticizing the company for being so atrocious," he said on the radio show. "If you are a consumer of gas, and obviously I think people who buy gasoline aren't necessarily wedded to a brand, you are sort of looking for the cheapest price around. But if you have a company with a horrible reputation, you probably would avoid them. If you saw an Exxon and a BP across the street, at this point, even though people don't like Exxon, you probably don't like BP more."
Added analyst Joe Mayger, "Refining and marketing for these guys is a tiny part of the business. They really make all their money doing exploration and production. So that [rebranding] would help the individual station owners, but I am not sure it would really do much for [BP] profitwise."For more on how retailers were affected by the BP oil spill in the Gulf of Mexico, watch for the September issue of CSP Magazine.
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