What factors are important to customers deciding what to buy where?
Valley Caltex, in North East Valley, Dunedin, has been a non-franchised Caltex for more than 20 years. It was purchased by the current owner in 2016. As well as a petrol station, Valley Caltex has a repair workshop, a gift shop and a grocery store. There is a franchised Caltex service station less than two kilometres away. Valley Caltex worked with Applied Management student Qiaojing Feng to investigate how they might retain and grow their customer base.
Jing surveyed 29 customers and 25 non-customers. She also spent two weekends and two week days observing the behaviours of 86 customers of Valley Caltex. Location, price and diversity of products were the three main factors affecting the existing customers' behaviour. Location, price and good service were the three main factors valued by non-customers. Whether or not they were Valley Caltex customers, price was the main concern. Good service was more important to females than to males, who were more likely to value the quality of products.
Jing's recommendations to the Valley Caltex management were to regularly ensure that all products are priced competitively, and to encourage staff to be more proactive helping female customers to pump fuel. She also suggested that they improve service to existing customers, for example by offering a loyalty scheme or monthly statement account, and consider expanding some product lines.
Image credit: Libby Zhu, used with permission