Company News

BP Loyalty Campaign to Launch

Provides benefit savings of up to 25 cents per gallon

HOUSTON -- BP North American Products is gearing up to launch its long-delayed loyalty card on the U.S. market. It will kick off a multi-million dollar promotional campaign to generate buzz for the new plastic, to be closely followed by the promise of discounts for consumers and bounties for marketers who sign up new accounts.

The pre-launch campaign beginning Jan. 15 will involve direct mail, e-mail and statement inserts sent to the company’s nearly 2 million current Visa cardholders from Chase Bank, BP’s card-issuer, that promise a one-time 10-cent-per-gallon discount as a “starter reward.”

The first “BP Visa with Pump Rewards” cards will be sent to existing accounts in February. Then in March, BP will target new customers with an offer of a 25-cent -per-gallon discount for every $100 they spend at BP-branded stations and at other retail outlets where competitive gasoline is not sold. The discount is good for the first 60 days that the account is open but is capped at 20 gallons per purchase.

At the end of the 60 days, the discount will drop to 15 cents per gallon for every $100 spent at a BP-branded outlet and 5 cents for every $100 spent elsewhere. The rewards will be good for a year.

“Retention and acquisition are key, so we’re investing marketing dollars to communicate the value of the new rewards and to engage as many consumers as possible,” the oil company told BP wholesalers in a recent communication.

The March push also will feature new point-of-purchase materials for retail sites, as well as various events and employee education initiatives. BP has set a target of 30,000 new card applications per month during the on-site promotions, which would be a near-300% increase over the current rate. Some two-thirds of all its credit-card applications come from retail outlets, the company communication noted.

Marketers will receive a bounty for every new card account they sign up: $25 for every new Visa card that is approved and activated by the consumer, or $10 for each BP proprietary gas card that is issued to customers.

BP’s rollback offer is two years behind schedule. The company was forced to delay its planned 2010 debut when it met resistance from potential partners after the Gulf of Mexico oil spill in April 2010. A second proposed rollout date of August 2011 was postponed because of technical problems and installation issues.

BP has yet to equip its 11,500 U.S. stations with the software that will allow them to accept the card, according to sources. As of November 2011, it had installed and certified software at 4,000 of its sites, with work being completed at the rate of 100 to 150 stations a week. BP Visa cardholders who can’t redeem rewards at their local BP station will receive a $15 statement credit for every $1 they earn in cents-per-gallon rebates. Cardholders with a BP proprietary gas card will receive a $3 statement credit for every 20 cents per gallon in rebates they earn.

Technology problems have hampered the software rollout at some stations, according to sources, but BP says it has resolved many of the difficulties. There have been about 120 of what BP classifies as “high-priority issues” through 4,000 installations, or about 3% of total installs, it said.

Work at some BP sites has not been completed for other reasons, however, including financial issues, a pending sale, or construction work. BP says there will not be enough time to move those outlets through its software-deployment process and those stations that do not “come off hold” by the end of December will be removed from the BP-managed and funded installation program.

If those retailers later decide that they want to offer BP loyalty rewards, they will have to do the work themselves through the “do it yourself” program that BP launched in October, as previously reported in CSP Daily News.

The same goes for stations that BP has decided would require “excessive remediation” work on its part to install the rewards software.

BP said sites that have been branded BP between Sept. 30, 2009, and Dec. 31, 2011, can qualify for a $1,000 incentive once the rollback software is installed and certified, as long as the work is completed within 180 days of signing the DIY agreement. However, marketers who had an opportunity to enroll in the program back in 2009 and either decided not to do so or later opted out will have to pay for the work themselves.

The DIY offer is “already gaining traction,” BP said. Seven BP-branded marketers had completed 91 DIY sites as of early November, and another 16 wholesalers have signed contracts for 401 stores and are preparing to start installation work.

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