May 14, 2008

Building brand loyalty in fuel retailing

Chrysler’s new incentive program to drive their sales can be a black swan in the making. The company allows participants to pay just $2.99/gallon for a maximum number of gallons (depends on the car model) for the next 3 years, the rest of the amount will be paid by the company. Chrysler obviously seems to know something about future gasoline prices otherwise its difficult to hedge so much against soaring prices, especially when some reports suggest that prices might be as high as 8-10$ per gallon.

What the concept will definitely do is generate a lot of enthusiasm amongst car users, since consumers are now more worried about driving costs rather than the initial purchase cost of a new car.

What I don’t understand is why the program is running only for a month i.e. from May 7th to June 3rd, 2008. Hopefully the marketing team at Chrysler should be working overtime to generate a lot of publicity over this and hence drive sales all over a month period.

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