Digital media services provider Fuelcast Media Network is teaming up with satellite networking solutions vendor Spacenet to enable gas and convenience retailers to offer customers video information and entertainment at the gas pump.
"A lot of digital signage is about displaying advertising to the consumer," said David Myers, Spacenet's senior vice president of marketing and corporate development. "Fuelcast is doing a nice job of blending news and information with their advertising. The customer doesn't just stand there and get bombarded with advertising the whole time."
Fuelcast is using the Spacenet SkyEdge VSAT (very small aperture terminal) platform to support its new enterprise satellite network, which was announced Feb. 25. Myers said modems at remote locations of Fuelcast customers connect to a satellite hub.
"Satellite is an inherently broadcast technology," Myers said. "It takes a lot less bandwidth to broadcast a signal to multiple locations at the same time, and is more efficient than performing many individual broadcasts [as with some other telecommunications technologies]."
According to Myers, other benefits of the Spacenet-supported Fuelcast service include the ability to broadcast locally targeted information and messaging, and to track how frequently an advertisement is viewed.
"Ad tracking is a competitive advantage," he said. "The advertisement doesn't start until the customer picks up the gas pump handle and ends when they put it down. The retailer knows the exact length of the advertisement and the time of day it was watched."
Jeff Lenard, vice president of communications for NACS, the Association for Convenience and Petroleum Retailing, an international trade association for convenience retailers and suppliers, said digital media services such as Fuelcast can help retailers overcome today's extreme price sensitivity for fuel.
"Consumers will leave you to save one penny a gallon," Lenard said. "There is enormous pressure to have the best price. However, when you compete on price, there tends to be one winner and a lot of losers."
By providing informational content at the pump, Lenard said retailers who sell gas can soften consumer price sensitivity and give customers more reason to frequent their locations. In addition, he said, pump-based advertising can draw customers into the store, which can make up for margin losses.
"Gas margins are about 8 to 9 cents per gallon, which roughly covers credit card fees," Lenard said. "Retailers are likely losing money on every gallon of gas they sell. The key is to get the consumer inside the store, where margins are normal."
Lenard said the average gas fill-up takes about 3 or 4 minutes of time, which the customer typically spends idly.
"If you can give the customer an experience [during that idle time], you're probably going to differentiate yourself," he said. "You can change the equation from price to value."