Advancements in fueling technology are dramatically changing how the petroleum industry does business, and in 10 years, the way consumers pump gas today will seem archaic.
John Eichberger, executive director of the Fuels Institute, Alexandria, Va., says one of the transformative drivers is the need to upgrade fuel pumps to be EMV compliant.
“In addition, liquid fuel demand is forecast to drop as much as 26% by 2040 due to increased fuel efficiency of new vehicles,” Eichberger says. This reduction in demand will not necessarily translate into a 26% reduction in trips; that’s because automakers are equipping more efficient vehicles with small fuel tanks to save weight. But Eichberger suspects the overall range of new vehicles will increase and cut into the number of trips consumers must make.
“If refueling frequency is a primary driver of in-store sales, stores need to figure out how to create a compelling draw to offset the reduction in fueling visits,” Eichberger says.
Fueling equipment is a powerful driver of trips, says Monica Arroyave, director of marketing, forecourt and payments, North America, for Gilbarco Veeder-Root, Greensboro, N.C.
“The forecourt is the first area that the customer sees upon entering the fuel marketer’s property,” Arroyave says. “Today’s forecourt acts as a marketing tool while serving in the functional capacity that consumers have come to rely upon.” That’s why improvements in safety and security via EMV and data encryption are taking center stage.
“Point-to-point encryption will continue to be the focus at the pump, as well as other security measures,” Arroyave says. “But the challenges remain with the outdated equipment that many retailers have.”
“If refueling frequency is a primary driver of in-store sales, stores need to figure out how to create a compelling draw to offset the reduction in fueling visits.”
Eichberger suspects the industry will begin to see the introduction of more connected equipment in the forecourt.
“Wi-Fi-enabled vehicles will be equipped to communicate with infrastructure when it is available and more dispensers will be equipped to connect with the internet and other connected devices,” Eichberger says.
Eichberger envisions interactive touchscreens rather than key punches, wireless/mobile payment replacing CRINDS, and automatic dispenser authorization occurring when a connected car pulls up to a pump. These types of intuitive technologies should become prevalent over the next decade or so.
Amazon and ExxonMobil recently partnered to develop a frictionless payment system using virtual assistant Alexa on Gilbarco’s Encore 700 S gas pumps. A customer can pump gas, say “Alexa, pay for gas” and leave without using a payment terminal. Alexa uses a customer’s Amazon Pay account to complete the transaction while confirming the gas station and pump number.
Arroyave expects this type of contactless payment to significantly evolve in the next 10 years. Interactive kiosks at the pump will enable customers to order prepared food from the store, and they will feature other types of cross-marketing and merchandising opportunities. Taking it from a transactional experience into a bigger and better total site experience will be the winning formula for those willing to look beyond the pump and nozzle.
Catch the Buzz
And what about the future implications of electric vehicles (EVs) at the pump? With the expected expansion of the EV market, more stations will install DC fast chargers, Eichberger says. At a recent working group he facilitated, many retailers cited “keeping up with the Joneses” as a motivator to install charging stations.
“The expansion of charging facilities will be market-specific, and I’m encouraging retailers to pay attention to what’s going on around them. If they never see EVs in the market, then it might be premature to make the investment,” Eichberger says. “But there are partnerships available that eliminate much of the risk associated with going it alone.”
The increased numbers of DC fast-charging stations at convenience stores would ideally be integrated with a store’s POS and loyalty system through a seamless application. Eichberger also envisions seamless charging as new EVs get equipped with wireless inductive charging. This would allow a retailer to install charging pads in parking spots; a recharging transaction would initiate as soon as the car parks, connected through a seamless application and requiring no physical plugging into a charging cabinet.