Phillips 66 Underscores Marketing Strategy

Post spinoff, new downstream entity emphasizes supply, loyalty, promotions

Samantha Oller, Senior Editor/Fuels, CSP

HOUSTON -- On the heels of completing its spinoff from ConocoPhillips, Phillips 66 plans to stay the course on its current marketing strategy, while adding value to its customers through an emphasis on supply, services and promotions, company branding execs told CSP Daily News.

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"Our marketing strategy will continue be to provide programs, services and promotions that add value for our customers and support their growth in a very competitive business environment," said Michael O'Connor, manager of programs and brand image for Phillips 66, which markets 76, Phillips 66 and Conoco brand gasoline.

He cites strengths such as reliable, dependable supply, the Kickback Rewards Systems loyalty program, and promotions such as Gas for Life, which awards free gas for year or life, as well as cash and gift-card prizes. The company is also strengthening its credit-card portfolio, including its fleet program.

"Customers will see a company that is committed to be a reliable supplier, provide compelling programs and services to our customers with a strong commitment to outstanding customer service," said O'Connor. "In a very competitive marketing environment, we will seek solutions that support our customers' efforts to build sustainable retail business models." It's an approach that echoes the efforts of other independent refiner-marketers to clinch the loyalty of their marketers.

The new Phillips 66, which will rival Valero as the largest independent refiner-marketer in the country, includes a refining and marketing network with 15 refineries with 2.2 million barrels per day of refining capacity, approximately 10,000 branded marketing outlets (including 7,300 branded fuel outlets in the United States) and 15,000 miles of pipelines and 56 terminals, in addition to a chemicals business conducted through a 50% interest in Chevron Phillips Chemical Co. LLC (CPChem), a joint venture with Chevron U.S.A. Inc., a wholly owned subsidiary of Chevron Corp.

In all, Phillips 66 branded marketers should see little disruption post-spinoff, according to O'Connor.

"Our primary focus has been to make the transition seamless to our customers by effectively migrating our systems to a Phillips 66 platform, communicating in advance the changes customers would see on May 1 and addressing any potential issues in advance of the change," he said.

Last July, ConocoPhillips announced plans to reposition the company's exploration and production and downstream businesses into two standalone, publicly traded corporations. ConocoPhillips, now a pure-play exploration and production company, stays at its Houston headquarters. Phillips 66, led by chairman and CEO Greg Garland, is also based in Houston.