Gas Stations Can Leverage the Internet to Increase Profit

Gas Stations make most of their money on retail sales, not gasoline.  In fact, for many gas is a loss leader and sales inside the convenience store are what keep them afloat.  For some stations, most of their traffic comes during rush hours when people are not price sensitive and when people are in a hurry to pay at the pump and leave, not go inside and find a snack to eat.  So perhaps incorporating some Revenue Management techniques could help the station to bring in customers during the slower times, which also may coincide with the hours that people are more likely to have a snack craving.

Say a station currently charges $3.00 a gallon for gas at all times. They could decide to lower the price to $2.95 from 1-5 each day.  However, although the station is in a busy part of town, the road it’s on isn’t very crowded during that time of day, so the store sees only a 10% increase in customers, which doesn’t do much for the store’s bottom line.  The increase in customers doesn’t increase retail sales enough to make this a profitable play.

In order to fully realize the plan, the gas station could login to at the start of the discounted period and update their price to $2.95, making them the cheapest gas station in the area.  Now the price sensitive customers in the area will go a few streets out of their way to get the discounted gas and the gas station could see a much higher bump in traffic during the afternoon.  Gasbuddy is a free marketing vehicle for savvy gas stations, allowing them to leverage their discounted rates into a lot more traffic than relying solely on passersby to notice the cheaper gas and stop.

In the past, business owners would have to pay to broadcast sales to customers, but today there are online avenues to freely broadcast sales, no matter what category of business. is focused on gas stations and gas prices specifically, but sites like fatwallet and slickdeals can be leveraged for product and service sales on a local or national level.

Leave a Reply