A Report on Marketing of Indian Oils Loyalty

Program- XTRAPOWER FLEET CARD

Santanu Roy
Student, Department of Management, University of North Bengal

Introduction:

ustomers are the ever strong asset of every organization. In the present era most of
the organizations are customer centric. The products or services are provided
according to the customer preference.
As per as the present scenario there exists intense competition between the several
organizations, so it becomes very necessary to maintain a strong customer relationship to
survive and grow in the market. The new customers as well as the existing customers form
the demand and supply base of any organization. It becomes very necessary to retain loyal
customers. And also the cost of creating a new customer base is more than retaining
existing loyal customers.
Loyal customers are important because they provide the consistency of business. If
any organization is able to create the feel good factor for the existing loyal customers then
automatically the customer base will be improved and new customers will be knocking for
deal.
With increasing oil prices and huge competition the oil companies are implementing
different strategies to strengthen the customer base and improve the business policy. Indian
Oil Corporation is also developing new ideas for succeeding in the competition. To retain the
existing loyal customers, many new initiatives have been adopted by I.O.C.L. One such big
idea is XTRA POWER FLEET CARD LOYALTY PROGRAM.
During this project we have been assigned to IOCL Retail Outlets as well as Private
Outlets which are having XTRA POWER facility, to market the XTRA POWER LOYALTY CARD
to the existing IOCL customers as well as new potential customers and at the same time to
obtain customers feedbacks and suggestions about the Loyalty Program. We have also
visited many other places like Truck Terminuses, Road side dhabas, Weigh Bridges, Check
posts etc. for marketing the Loyalty Card.

OBJECTIVES OF THE PROJECT

The major objectives of the project are:
To study the loyalty relation between the customers and the organization.
To study the benefits provided by IOCL to their loyal customers.
To collect customer feedback and suggestions about the XTRA POWER Loyalty
Program.
To study the comparative analysis between the loyalty card benefits of other oil
companies.

To check our theoretical knowledge with comparison to the practical market

situation.

IOCL MAJOR OBJECTIVS

To serve the national interests in oil and related sectors in accordance and consistent
with Government policies.
To ensure maintenance of continuous and smooth supplies of petroleum products
by the way of crude oil refining, transportation and marketing activities.
To provide appropriate assistance to consumers to conserve and use petroleum
products efficiently.
To create a strong research & development base in refinery processes, product
formulations, pipeline transportation and alternative fuels.
To further enhance marketing infrastructure.

LOYALTY PROGRAM
Loyalty programs are structured marketing efforts that reward, and therefore encourage
loyal buying behaviour the behaviour which is potentially beneficial for the organizations.
Earning customer loyalty goes beyond gaining customer satisfaction. Loyal
customers evangelize the brand by sharing their satisfactory experience with their
surroundings.
The organizations, in terms of Loyalty Program, may offer benefits in a number of
different ways. Many loyalty programs offer a sustained discount for a period of time (e.g.
10% for 1 year) or a onetime discount with certain criteria (e.g. 10% on a single purchase of
Rs. 10000). Many offers reward points which may be redeemed for products which may or
may not be directly related to business.
Loyalty cards are the most common form of loyalty programs found throughout the
world today. Some of the first loyalty programs instituted by airlines were in the 1970s in
the form of frequent flyer miles. In those loyalty programs, one accrues points by flying on
the airline and then redeems the points into tickets, upgrades, or even third-party benefits.
Loyalty programs have gained popularity immensely from the time when the
organizations became customer centric. Now a days Organizations thinking is that the
customers feel good factor is the most valuable wealth for any organization and for this
reason the customers are gaining special treatments in the form of loyalty programs.
An Integral part
The immense competition is making the loyalty programs an integral program of business of
day to day functioning of petro-retailing. Right now many such loyalty programs are run by
the petro-retailers like XTRAPOWER (IOCL), EXTRAREWARDS (IOCL), SMART FLEET (BPCL),
PETRO CARD (BPCL), and DRIVE TRACK (HPCL). However, these programs are mainly
focused at the bulk consumers. But the small consumers are being also provided these types
of facilities.

XTRA POWER FLEET CARD LOYALTY PROGRAM

IOCLs XTRAPOWER Fleet Card program is a most sound step towards building the loyalty
among the existing customers and creating a new pool of customers.
XTRAPOWER Fleet Card program is a complete smart card-based fleet management
solution for fleet operators and corporate for cashless purchase of fuel and lubricants from
designated retail outlets through flexible pre-paid and credit facilities.
The fleet card also offers an exciting rewards program and unique benefits like
personal accident insurance cover and vehicle tracking facilities.
In just under two years of its launch, it has emerged as the largest fleet card in the
country with the widest retail outlet coverage.
Any business entity owning or operating a vehicle fleet can become a member of the
XTRAPOWER fleet card program at a nominal annual charge. Each fleet owner is issued a
Fleet Control Card and vehicle-specific Fleet Cards for every vehicle enrolled under the
program.
For enhanced security, the fleet card transactions are authorised through a unique
Personal Identification Number (PIN).
Moreover, the card can help track each vehicle's movement across remote corners
of the country, leading to an improvement in vehicle utilisation and route compliance.
XTRAPOWER is also backed by IndianOil's vast infrastructure network and web-based
support services.

COMPARISON OF XTRA POWER WITH DIFFERENT LOYALTY CARDS

Loyalty Cards

XTRAPOWER
(IOCL)

SMART FLEET
(BPCL)

DRIVE TRACK
(HPCL)

Benefits
Reward point system

5 XTRA Points on purchase

of Rs. 100

15 Petromiles on purchase
of Rs. 150

500 Drivestars on
purchase of Rs. 100

Cash Loading system

Manual or by Central Cash

Management System

Manual or by Central Cash

Management System

Online pin unlocking

facility
Fuel Redemption facility
Insurance for owner

Yes

Yes

Manual or by Central
Cash Management
System
Yes

Yes
Rs. 10000/- per card,
maximum up to Rs.
2000000/Driver: Rs. 50000/- , Codriver: Rs. 25000/- and
Cleaner: Rs. 25000/-

Yes
No insurance for owner

Yes
No insurance for owner

No insurance for driver and

cleaner

Rs. 100000/- for Driver

and Cleaner separately

Insurance for driver and

cleaner

Medical Insurance

Lost Card Liability

Insurance

Prepaid and Credit facility

Rs. 10000/- per card

Owner: Rs. 2500/-,
maximum Rs. 50000/Driver: Rs. 2500/Co-driver: Rs. 2500/Cleaner: Rs. 2500/Maximum up to Rs.16,000/per card subjected to
misuse of the card within 24
hours from lodging the loss
complain with XTRAPOWER
24 HOUR CUSTOMER
HELPLINE
Yes

No Medical Insurance

No Medical Insurance

No such benefit

No such benefit

Yes

Yes

FINDINGS

Most of the existing customers were very supporting and interesting. They have a
very strong will for IOCL.
Most of the customers who showed interest were ready to go for XTRAPOWER Fleet
Card or to continue the service actively.
Initially a large number of potential customers were frightened of giving the copies
of their vehicles R.C. Book. It was for the probable chance of misuse of the
documents. But later most of them were convinced.
Making of new XTRAPOWER Fleet Cards were not so difficult. The customers were
being well understood by us and were ready to make new cards.
A widely visible range of potential customers were not well aware about IndianOils
XTRAPOWER Fleet Card Loyalty Program. It is due to lack of effective promotion in
this region.
Most of the existing Fleet Card Users suggested IOCL for implementing the SMS
Balance Enquiry Service.
Some of the customers facing technical difficulties while using the cards. But the
Outlet staffs are managing this type of problems as much as possible.
IOCL has a huge number of Private Retail Outlets compared to the Company Owned
Retail Outlets, so it is somehow lowering the customer base.
IOCL is losing some portion of the potential customers for providing fewer parking
spaces to the fleet operators by the Private Retail Outlets.
Some of the fleet owners/operators suggested for updating the website of
XTRAPOWER on a regular basis.
The customers suggested for implementing XTRAPOWER Control System in the retail
outlets as much as possible. This will result in increased customer pool and customer
satisfaction.

CONCLUSION
XTRAPOWER is a sound step of IOCL towards building loyalty among the existing customers.
Loyalty program works effectively when the customer is emotionally attached with the
brand.
The best way to keep customers
loyal is to provide quality product or service that provides good value for money. Branding
alone will not be completely able to make the customers loyal. But backing up a quality
product or service with branding and loyalty programs will develop quicker.
Offers and loyalty schemes can
increase loyalty, but they are no substitute for (and will not work without) a quality product,
good customer service, and friendly customer relationships.
IOCL should have to promote
XTRAPOWER Fleet Card Loyalty Program in such a strategic way, so that the Program
reaches to the every corner of the country. For this to happen IOCL should give more effort
in the promotional and marketing activities of XTRAPOWER. All these will result in
tremendous success of the Loyalty Program.
Also the customers should be
involved in the program by constant communication to understand the extreme details and
benefits of the program.

RECOMMENDATIONS

A huge number of customers are not aware regarding the XTRAPOWER Fleet Card
Loyalty Program and its features. More promotional and marketing practices are
necessary.
There remains a huge unexplored market for implementing the Loyalty Program. So
continuous Market Study and Analysis is required.
There remains a great requirement of Balance Check Facility through SMS. So IOCL
should introduce the service as soon as possible.
Customers prefer to fill oil from Company Owned Retail Outlets compared to the
Private Retail Outlets. So if it is possible to establish more Company Retail Outlets,
then IOCL should go on.
The long vehicle staffs require proper Parking Places in the Retail Outlets. IOCL
should try to provide flexible parking places to the vehicle staffs for the purpose of
increasing customer loyalty and satisfaction.
XTRAPOWER Fleet Card Swiping Kits should be installed in maximum number of
Retail Outlets and the swiping machines should be properly maintained.
Reference

A.
1.
2.
3.
4.

Websites URLs
(http://www.iocl.com/aboutus.aspx)
(http://www.iocl.com/products.aspx
(http://www.iocl.com/services.aspx)
(http://www.iocxtrapower.com/programe_details.php)

5. (http://www.iocxtrapower.com/credit_partners.php
6. (http://www.iocxtrapower.com/rewards_program.php)
7. (http://www.iocxtrapower.com/xtrafeature_ins_scheme.php)
8. (http://www.iocxtrapower.com/iocl_xtra_easyfuel/programe_details.php)
Last access date: 18th August,2013
B. Company Presentations and URLs
1. Investor_Presentation_2013
(www.iocl.com/downloads/Investor_Presentation_2013.pdf)
2. Investor_Presentation_June_2011 (www.iocl.com/downloads/Investor_Presentation_June_2011.pdf
C. Books
1. N. G. Das, Statistical Methods: McGraw Hill
2. P. Kotler, Marketing Management: PEARSON Education- 13th Edition