Oil & Gas companies are reinventing the customer journey at the service station and it is not focused anymore on enhancing the non-fuel business business at the retail store. What was a trend in terms of disinvestment in the downstream business is picking up as a new business opportunity to increase revenue and customer stickiness. On the other hand, some banks are loosing opportunities in terms expanding their value chain and services to a combination of joint ventures between Oil companies and Telecom’s.
We see Amazon going to brick and mortar grocery stores; we see Oil & Gas industries enter into renewable energy, we see Utilities companies entering in mobility business, we see Energy and Construction also entering in renewable energy. Hence, there is going to be fierce competition among the mature industries, between incumbents and new entrants and disruptors.
Digital transformation fades the value chain separation and starts an intersection, meaning that if Engineering and Construction companies enters into the mobility business by providing services related with electric car charging stations, soon will be working together in partnerships will gas station retailers, convenience stores retailers, banks, telecoms, mobile money providers and together, the ecosystem of companies working in the same space interacting with the consumer as one.
The case of the Smart Service Station
The book The Digital Transformation Playbook Rethink Your Business for the Digital Age  , provides a simple framework on how to access your position “vis-a-vis” challengers that by the power of technology start to intersect business models inside of competitors value chain. What I like about the framework is how easy it is to organize some ideas to spark digital transformation.
Telecom’s instead of banks see 3 different kind of customers:
- The car driver;
- The retail store;
- The 3rd party provider – a company that does not operate at the station. It can be an insurance company, an online retailer, GPS technology provider, the car manufacturer;
- The car manufacturer, if the car is connected, like some of the new generation models.
The Bank, only sees the car driver.
The Telecom wants to provide the following value proposition:
- The car driver – pay on customer terms; product offerings and promotions that are related with the real customer needs and wants; access to extended valuable services, like journey management, integrated road assistance.
The Bank only offers cashless payment to the car driver.
In terms of value network, the Telecom offers to the car owner:
- Integration, with the payment providers, retail stores;
- Customization, the Telecom is able to tailor offerings based on any data coming from interactions with the partner ecosystem;
- Simplicity, the car driver can pay using a mobile phone only.
- Customers, 4 customer categories instead of the car driver only;
- Partners, endless partners connected with the platform, letting the car driver add or select the partners that we likes to engage with;
- Complementary products or services, by the effect of partnership, beyond the typical cross-sell, up-sell;
- Cost structure, lower. Customers are sensitive to fees and levies that banks charge using cards;
- Data assets, a much higher precise of the customer profile that is not based on the transactions that occur at the station, but across all the connected partners.
The Bank only offers :
- Simplicity. Customer do not need to use cash;
Banks could for example expanding value chain and services: connect the customers with other service providers – e.g. wellness providers, retail companies – becoming part of customers’ needs and lifestyles. The more the customer interacts with the customer ecosystem, the more the ecosystem benefits in terms of shared customer profile data and business transactions. However, as some banks are still focused on putting their customer’s to transact with the bank, they forgot that Telecoms and Oil & Gas companies, or even non-usual players are shifting customers to transact with banks at gas stations.
 The Digital Transformation Playbook Rethink Your Business for the Digital Age – David Rogers, ISBN – 978-0231175449