For the past few decades, fuel retailers have made the same imperfect pitch for customers’ loyalty.

That’s according to Alex Kinnier, co-founder and CEO of GetUpside, Washington, D.C., a loyalty platform that draws anonymized information from consumers’ credit card data to personalize the discounts they receive at convenience stores and gas stations.

“Today, a station puts a sign price up and then they have a loyalty program that gives a fixed discount to the consumer or, at best, two tiers of discounts to a consumer,” Kinnier says. “You are inherently cannibalizing your profits.”

Taylor of Conexxus agrees, and he likens most loyalty programs to “trading dollars” with consumers. “Most [fuel retailers] are losing money on loyalty today because loyalty is so friction-filled,” he says. 

From there, the loyalty executive and the standards leader take different logical paths to reach similar technological solutions about how loyalty will function in the future.

Kinnier believes the consumer-facing fuel industry is a “flat to declining market” and that most consumers don’t care where they get their gas. Fuel retailers will need to use big data to power personalized pricing at the pump and draw customers away from competing gas stations. 

Taylor believes fuel brands should actively work together and pool resources to reduce friction across differently branded forecourts for consumers. Taylor says most fuel consumers practice what he calls “multi-homing,” in which they bring their business to different fuel brands depending on the circumstance. Rather than fight it, fuel retailers should embrace the reality of multi-homing and confederate their loyalty capabilities around one platform, he says. “I’m literally talking the heresy of a platform that can be consumed by a Shell app and an ExxonMobil app,” Taylor says.

“Most [fuel retailers] are losing money on loyalty today because loyalty is so friction-filled.”

The Eastern Future

Taylor says Chinese commerce has already moved in this direction with ubiquitous apps such as Alipay and WeChat Pay. In China, these payment apps—which function like loyalty programs in the U.S.—alert shoppers when they enter a store for the first time, asking them if they would like their transactions to take place on one app or another. Then, with a few taps of the smartphone, the consumer uploads their pertinent data from WeChat Pay or Alipay. “I’m not reentering my payment information, my loyalty information or any of that stuff,” Taylor says. “I can even automate how I get on the loyalty program.”

But how can technology help retailers attain that level of personalization? First, Kinnier says, it takes a comprehensive data set that gives the merchant an understanding of that individual consumer’s purchase history. GetUpside uses anonymized credit card data from consumers for this today, but there will be other sources of payment data in the future if Taylor’s vision of a POS based on personal smartphones comes to fruition. 

With that data, retailers will more effectively personalize consumers’ payment options and overall experience to deliver maximum incremental profit, Kinnier says. For instance, if a consumer is filling up their car on a hot day, the automated systems at the pump can offer a discount on a cold beverage the consumer has purchased before.

Then, as technology progresses, new payment interfaces will emerge, such as updated car dashboard computing systems. “With new cars, 5G and so forth, we’re going to be connected all the time,” Taylor says, “and you’ll have this flat panel on the dashboard of your car that’s highly interactive.”

To combine these features into one complete vision, continuously improving the level of personalization for consumers is a must for future loyalty programs, Kinnier says. As the level of personalization improves, so will the amount of dollars that consumers spend at that c-store. Consumers who spend more will see a better retail experience.

This can include delivering products from the store to the customer at the fuel pump. “The real trick is being able to bring the store to the consumer,” Taylor says. “Certainly, the wait that you have on getting gasoline gives you enough time to place an order and go pick it up, or have it run out to you, or curbside pickup. There are lots of ways to start experimenting with moving merchandise out to the fuel island.”