REPORT ON

NON-FUEL REVENUE GENERATION

IN PETROLEUM RETAIL SECTOR

FOR

INDIAN OIL CORPORATION LIMITED

MARKETING DIVISION
LUCKNOW

BY
AWADHESH NATH TIWARI
08PG0208
MBA(2008-10)

CHRIST UNIVERSITY INSTITUTE OF MANAGEMENT

Dairy Circle, Hosur Road, Bangalore-560029

1
 Acknowledgement

I would like to extend my sincere thanks to Shri G.Tiwari(GM),

Mr.Najmi(CRSM),Mr.Vigyan Kumar(SDRSM) & specially Mr.Sunil Vikram
Singh(AM-RS ), my project guide for his guidance and support throughout my
training at Indian Oil Corporation Limited, Marketing Division,Lucknow. His
calm demeanor and willingness to teach has been a great help in my
successfully completing the project. My learning has been immeasurable and
working under him was a great experience.

My heartfelt thanks is also extended to all the staff of Indian oil Corporation
Limited for providing a hospitable and helpful work environment and making
my summer training an exciting and memorable event.

My sincere thanks to Mrs.Veda Balaji, my internal faculty guide, whose

continuous help and enthusiasm has helped me to complete the project
successfully.

I also wish to thank Christ University Institute of Management for making this
experience of summer training in an esteemed organization like Indian Oil
Corporation Limited possible. The learning from this experience has been
immense and would be cherished throughout life.

Awadhesh Nath Tiwari

Christ University Institute Of
Management

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 EXECUTIVE SUMMARY

The objective of the project was to study the impact of the initiatives taken by
Indian Oil Corporation Limited for Non-Fuel Revenue generation in the
Petroleum Retail sector and suggest ways to improve their effectiveness and to
find out the scope for their broader implementation.

The purpose of the project is to essentially give Indian Oil an idea about the
customer awareness level with respect to this initiative and to present
customer’s needs and preferences which would help the company in improving
the service level as well as the product offering under the initiative and
simultaneously increase the customer loyalty towards the company.

The project was designed accordingly. A primary research was conducted

across 10 Retail Outlets. 1000 customers were contacted for the initiative across
the city of Lucknow. The research tool was the specially designed questionnaire
and interview with the customers of Indian Oil.The questions covered a wide
range of issues including:
 The awareness level of the initiatives.
 The satisfaction level of the customers with Indian Oil.
 The important factor which customers consider important while buying.
 The preference priorities of customers.
 The buying preferences of customers

For the purpose of this research it was absolutely imperative to find out what
the consumers want from Indian Oil.This required meeting the customers
and filling up the questionnaire according to their responses and to discuss
with them the issues related with this initiative. All the analysis in the report
is drawn out of these questionnaires and all conclusions are drawn and the
recommendations made to the company are based on the results of the
analysis.
This research will provide Indian Oil Corporation Limited with information
like the current awareness level, the satisfaction level, response of customers
towards the initiatives; their needs and preferences etc.This will help the
company in taking a decision to improve the effectiveness of this initiative.

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 Table of Contents

Sr.no Topics Page no.

1 Introduction 5
2 Literature Support 11
3 Process/Methodology of Study 13
4 Data Collections 17
5 Analysis and Interpretation 21
6 SWOT Analysis 31
7 Conclusion 32
8 Recommendations 34

References 36
Appendix-1(Questionnaire) 37

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 INTRODUCTION

Indian Oil Corporation Ltd. is currently India's largest company by sales with a
turnover of Rs. 247,479 crore (US $59.22 billion), and profit of Rs. 6963 crore (US $
1.67 billion) for fiscal 2007.

Indian Oil is also the highest ranked Indian company in the prestigious Fortune
'Global 500' listing, having moved up 19 places to the 116th position in 2008. It is
also the 18th largest petroleum company in the world. Indian Oil's vision is driven by
a group of dynamic leaders who have made it a name to reckon with.

In this section, you can peruse through the profile and spread of Indian Oil across
the country & abroad. You can also know about Indian Oil's current financial
performance, special initiatives and causes along with the prestigious recognitions &
awards that have come its way for exceptional performances

  Vision, Mission & Values

 
Vision
A major diversified, trans-national, integrated energy company, with national
leadership and a strong environment conscience, playing a national role in oil
security & public distribution.

Mission

 To achieve international standards of excellence in all aspects of

energy and diversified business with focus on customer delight
through value of products and services, and cost reduction.
 To maximize creation of wealth, value and satisfaction for the
stakeholders.
 To attain leadership in developing, adopting and assimilating state-of-
the-art technology for competitive advantage.
 To provide technology and services through sustained Research and
Development.
 To foster a culture of participation and innovation for employee growth
and contribution.
 To cultivate high standards of business ethics and Total Quality
Management for a strong corporate identity and brand equity.

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  To help enrich the quality of life of the community and preserve
ecological balance and heritage through a strong environment
conscience.

Values - Values we nurture

Care - stands for
Innovation - stands for
 Concern
 Creativity
 Empathy
 Ability to learn
   Understanding
     Flexibility
 Cooperation
 Change
 Empowerment

Passion - stands for Trust - stands for

 Commitment  Delivered Promises
 Dedication  Reliability
 Pride  Dependability
 
   Inspiration    Integrity
 Ownership  Truthfulness
 Zeal & Zest  Transparency

  Objectives & Obligations

 
Objectives

 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 way of crude oil refining, transportation and
marketing activities and to provide appropriate assistance to
consumers to conserve and use petroleum products efficiently.
 To enhance the country's self-sufficiency in crude oil refining and build
expertise in laying of crude oil and petroleum product pipelines.
 To further enhance marketing infrastructure and reseller network for
providing assured service to customers throughout the country.
 To create a strong research & development base in refinery
processes, product formulations, pipeline transportation and
alternative fuels with a view to minimizing/eliminating imports and to
have next generation products.
 To optimize utilization of refining capacity and maximize distillate yield
and gross refining margin.
 To maximize utilization of the existing facilities for improving efficiency
and increasing productivity.
 To minimize fuel consumption and hydrocarbon loss in refineries and
stock loss in marketing operations to effect energy conservation.
 To earn a reasonable rate of return on investment.
 To avail of all viable opportunities, both national and global, arising out

6
 of the Government of India’s policy of liberalization and reforms.
 To achieve higher growth through mergers, acquisitions, integration
and diversification by harnessing new business opportunities in oil
exploration & production, petrochemicals, natural gas and downstream
opportunities overseas.
 To inculcate strong ‘core values’ among the employees and
continuously update skill sets for full exploitation of the new business
opportunities.
 To develop operational synergies with subsidiaries and joint ventures
and continuously engage across the hydrocarbon value chain for the
benefit of society at large.

 
Financial Objectives

 To ensure adequate return on the capital employed and maintain a

reasonable annual dividend on equity capital.
 To ensure maximum economy in expenditure.
 To manage and operate all facilities in an efficient manner so as to
generate adequate internal resources to meet revenue cost and
requirements for project investment, without budgetary support.
 To develop long-term corporate plans to provide for adequate growth
of the Corporation’s business.
 To reduce the cost of production of petroleum products by means of
systematic cost control measures and thereby sustain market
leadership through cost competitiveness.
 To complete all planned projects within the scheduled time and
approved cost.

 
Obligations

 Towards customers and dealers:- To provide prompt, courteous and

efficient service and quality products at competitive prices.

 Towards suppliers:- To ensure prompt dealings with integrity,

impartiality and courtesy and help promote ancillary industries.

 Towards employees:- To develop their capabilities and facilitate their

advancement through appropriate training and career planning. To
have fair dealings with recognized representatives of employees in
pursuance of healthy industrial relations practices and sound
personnel policies.

 Towards community:- To develop techno-economically viable and

environment-friendly products. To maintain the highest standards in
respect of safety, environment protection and occupational health at all

7
 production units.

 Towards Defence Services:- To maintain adequate supplies to

Defence and other para-military services during normal as well as
emergency situations.

Marketing
 
Reaching out to a Billion Hearts

Indian Oil has one of the largest petroleum marketing and distribution networks in
Asia, with over 35,000 marketing touch points. Its ubiquitous petrol/diesel stations
are located across different terrains and regions of the Indian sub-continent. From
the icy heights of the Himalayas to the sun-soaked shores of Kerala, from Kutch on
India's western tip to Kohima in the verdant North East, IndianOil is truly 'in every
heart, in every part'. Indian Oil's vast marketing infrastructure of petrol/diesel
stations, Indane (LPG) distributorships, SERVO lubricants & greases outlets and
large volume consumer pumps are backed by bulk storage terminals and
installations, inland depots, aviation fuel stations, LPG bottling plants and lube
blending plants amongst others. The countrywide marketing operations are
coordinated by 16 State Offices and over 100 decentralized administrative offices.

Several landmark surveys continue to rate Indian Oil as the dominant energy brand
in the country and an enduring symbol for high quality petroleum products and
services. The heritage and iconic association that the brand invokes has been built
over four decades of commitment to uninterrupted supply line of petroleum products
to every part of the country, and unique products that cater not only to the functional
requirements but also the aspirational needs of millions of customers.

Indian Oil has been adjudged India's No. 1 brand by UK-based Brand Finance, an
independent consultancy that deals with valuation of brands. It was also listed as
India's 'Most Trusted Brand' in the 'Gasoline' category in a Readers' Digest - AC
Nielsen survey. In addition, Indian Oil topped The Hindu Businessline's "India's Most
Valuable Brands" list. However, the value of the Indian Oil brand is not just limited to
its commercial role as an energy provider but straddles the entire value chain of
gamut of exploration & production, refining, transportation & marketing,
petrochemicals & natural gas and downstream marketing operations abroad. Indian
Oil is a national brand owned by over a billion Indians and that is a priceless value.

Retail (Non-Fuel Alliances)

In an effort to tap alternate revenue streams, IndianOil is focused on enhancing

its non-fuel revenues (NFR) through its 195 million sq feet of retail space.
IndianOil has already mapped petrol stations to study the tyrefalls and assess
their site potential with the help of consultants, Technopak Advisors Pvt Ltd. A
well-structured roll out plan is already underway and petrol stations, primarily in
the North have been identified for a pilot study. The NFR model developed will
provide for sharing of revenue streams with the dealer network to enable

8
 unlocking of existing retail space value that both IndianOil and its dealers
command. Several alliances have already been forged with leading brands like
Hindustan Unilever Ltd, Dabur, ICICI Bank, Ferns & Petals, MTR Foods, PVR
Cinema, UAE Exchange, Reliance Capital and DHL. If you wish to partner us in
our non-fuel business ventures email your proposal to IndianOil

LPG (Non-Fuel Alliances)

IndianOil has signed business agreements with reputed companies and brands
for marketing their products through its countrywide network of Indane
distributors. Some of the hugely successful products being currently sold through
the network are Suraksha rubber hoses, Green Label stoves, Zenith and Safex
fire extinguishers. New tie-ups have been signed for marketing Suraksha flame
retardant aprons, CNG/LPG auto kits, e-booking of railway tickets, money
transfers, KwalityWalls' kiosks, Mysore Sandal Soaps, courier services and
telecom products through the Indane network.

If you wish to partner us in our non-fuel business ventures email your proposal to
the IndianOil contacts provided in this section.

Why is this initiative Important?

The face of the Indian consumer is changing at a great pace. With the rise in
disposable income the needs of the customer is also changing. Today a
customer looks for “value for money” and also expects to get a customized
solution for his needs with a personal touch. This initiative aim to fulfill both
the above mentioned requirements of the customer.
These Convineos aims at providing the customer with a customized solution for
his daily needs by ensuring a better service according to his convenience and
requirement and also ensures that the customer is not only satisfied with the
service being provided instead is delighted by the way he is treated and the
service is provided to him.
The CONVENIO(NFR) initiative aims at giving the customer value for money
by ensuring availability of excellent quality products which are delivered to
him at no extra cost and which come with quality assurance from Indian Oil.

Objective of Study:

The Research project has been carried out to aid Indian Oil Corporation Limited
in offering services that the customer needs and also to improve on some of the
9
existing services of the Company. The project covers the initiatives in
Petroleum Retail sector.The objective of the project is:

1- To study the avenue for Non-fuel revenue generation in the Petroleum Retail
sector & analyze the effect of this initiative on the customers.

2- To study the response to the “ConveniO(NFR)” initiative.

3- To study the feasibility and scope of implementing this initiative in a broader

way.

4- To suggest ways to increase the effectiveness of the initiative.

Purpose of the study:

To maintain and enhance the position further, IOCL decided to have a thorough
insight into the effects of the initiative it has taken, which depends upon the
customer perception of the product conception and their views towards the
service provider, thus, the feedback from the customers becomes all the more
important.

The purpose of the undergone study is to study the initiative taken and to
evaluate their effectiveness and to suggest measures to further enhance
their efficiency.

The study focuses on the following dimensions:

 To identify the effect of this initiative on the customers.
 To identify the factors which have been recognized most by the
customers.
 To identify and recognize the factors which are considered most
important by the customers for a better and efficient service.
 To find reasons which will make customers more open towards
purchasing products from Indian Oil.
 To find an optimum product mix offered by the company.
 To find ways to increase the customer Loyalty.

The Company wants to strengthen its service and product offering by

gathering information about the true market feedback for Non-Fuel

10
Revenue generation initiatives. Indian Oil Corporation Limited needs to
know about the customers’ preference and opinion in this regard.

LITERATURE SUPPORT

Management of the retail end is a key determining factor in the success or

otherwise of any business. To gain a sustainable competitive advantage, a
retailer needs to understand and satisfy both the apparent and latent needs of the
customer. This principle holds true in NFR retailing too. All efforts at
exploration and production, distribution and marketing finally culminate at the
retail point after moving through a long complicated supply chain. The
downstream business is extremely intricate and of substantial strategic
importance to the national economy. Fuel and Non-fuel products would
continue to play a key role in the national economic growth. This is what makes
the retail business exciting and challenging. It demands continuous efforts at
improvement of product and services, higher customer satisfaction, and offers
endless opportunities to innovate.

The business environment in India has undergone a significant change in the

past few years, and nowhere is it as pronounced as in the petroleum and non
fuel products sector. Operational freedom to the Government oil companies in a
host of areas including determining their own market share, freedom to prepare
and implement their market plans, selection of dealers etc has been provided.
We are also gradually moving towards a market determined pricing regime in
letter and spirit. This liberalized scenario is making the sector intensely
competitive, and the oil companies, especially those in the public sector would
need to adopt a more customer-focused approach to the retail end of their
business.
Besides providing the policy framework for a liberal, decontrolled petroleum
sector, the Government is conscious of the need to encourage a disciplined and
responsible market.

The Petroleum and Natural Gas Regulatory Board Bill is a step in this
direction. This Bill seeks to set up a regulatory board to regulate refining,
distribution and marketing of products with a view to protect the interest of
consumers and promote fair competition among the entities. Ministry of

11
Petroleum & Natural Gas has also issued various control orders and directions
to help check adulteration.

Some of the major challenges that need to be immediately and purposefully

addressed can be summarized as under:

a) Quality
b) Quantity
c) Price
d) Value added services
e) Building brand identity
f) Generating higher volumes
g) Reaching the unserviced areas

Above all, the oil companies can build a sustainable competitive advantage only
if they are driven by a customer centric approach and seek to continuously
improve .The boom in consumerism has given rise to a mature and demanding
customer. The companies too need to mature fast.
To sum up, there is a need for a fundamental rethinking in the way companies
do business. Customers are beginning to notice that they now have a choice
when it comes to LPG and other fuel products, and they also have a choice of a
host of other non-fuel offerings. So the customer has to be the focus of all our
strategies. It is he who will define quality, be it product or service. And the oil
companies can afford to neglect the customer at only their own peril.

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 PROCESS/METHODOLOGY OF STUDY

In business collection of raw data allows the managers to see the real scenario
and then take a decision as per the data obtained. There are several implications
in this statement:
 Indian Oil gets a clear picture of the current state of its service and level
of successful implementation of NFR initiatives.
 They can examine the available information in the form of data to make a
decision
 They can even get a clear picture of the scenario or potential of the
offerings and also their comparison with other sources of product
availability.
 This will help the company in making any decision.
 The information can only be gathered by data collection and then
analyzing the available data.
Therefore, it can be said that the data collection is an
important part of the project.

Data Information
Raw numbers

The projected objectives were considered and as per the requirement a

market survey was done.

Procedure:

13
 The procedure that followed can be enlisted as below:

 Reading about the initiatives

 Deciding on the objective to proceed.
 Developing Survey instruments
 Conducting personal interviews of different customers.
 Finally analyzing the data

Process adopted:

1. Gaining knowledge about the initiatives:

Reading about the product was the first step undertaken .Also
a briefing by the company officials helped in gaining sufficient knowledge
about the initiatives taken This gave not only in depth knowledge about what
is been offered by the company but also proved useful while developing the
questionnaire.

2. Steps in the Development of the Survey Instruments

The main instruments required for survey was a well-developed

questionnaire. The questionnaire development took place in a series of
Step 1
steps as described below:

Step 1: Research objectives are being transformed into information objectives

Step 2: The appropriate data collection methods have been determined

Step 3: The information required by each objective is determined

Step 4: Specific Questions/Scale Measurement format is being developed

Step 5: Question/Scale Measurement is being evaluated

Step 6: The number of information needed is being determined

14
Step 7: The Questionnaire and layout design is being evaluated

Step 8: Revise the Questionnaire layout if needed

Step 9: The Questionnaire format is being finalized

3. Customer Survey and interview:

The people play an important part as a clear perception of

people about the product can be estimated and known. Studying the need
levels of the people regarding the grocery and other products can be
observed. It was very useful in knowing about the requirements of the
people.

Research Design:

A two stage Research was conducted:

1. Secondary Research:
Data was collected from retail outlets and catalogues to understand the
product and the rates of the different products.

2. Primary Research:
A Primary Research was conducted:
The questionnaire was prepared for the customers of the Indian Oil outlets
and following areas covered:
 Current Satisfaction Level for customers
 Changes observed by them in recent days
 The preference for service offered
 Their faith on Indian Oil services
 For NFR initiatives their awareness level
 Their way of purchasing
 Important criteria for choosing a particular method of purchase
 Their openness to purchasing certain products from Indian Oil
 Their latent demands.

15
Sampling Plan:

Elements:
The target population of the study included the existing Indian Oil
customers

Sample size: 900 customers.

Method: Questionnaire along with interview

RESEARCH METHODOLOGY

(1) RESEARCH DESIGN

 Descriptive research
 Sample Survey -Retailors & Consumers
 Area of survey – Lucknow city

(2) DATA COLLECTION METHOD

 Primary Data
 Secondary Data

(3) POPULATION DEFINATION

 Retailers and consumers of Lucknow city

(4) SAMPLING DESIGN

 Convenience

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 DATA COLLECTIONS

Data Collection Plan:

Initially information was gathered through the company officials and website
about the products and offerings. Then retail outlets were contacted for the
customer base information and product offerings and comparison with market.
Then the customers were contacted at the retail outlets of the Indian Oil.

Types of Primary Data collected:

The following tools were used during the collection of primary data:
.

1-Attitudes/Opinions:

The questionnaire was used to get hold of individual’s preference, inclination

and requirement from the products that the Company offers to its
customer. Attitude is an important notion in the marketing literature, since it is
generally thought that the attitudes are related to the behavior of individual, due
importance was accorded to this and noting made based on interviews.

2-Awareness/Knowledge:

They are used in marketing research and refer to what respondents know about
the product or initiative For instance; here efforts have been made to find out
the market awareness regarding the new initiatives.

3-Intentions:

A person’s intentions refer to the individual’s anticipated or planned behavior.

The research aims at finding out through the collected primary data the
intentions of the people in general about the Non-Fuel Revenue initiative

17
through their implicit and explicit behaviour.In this project the customers have
been segregated as per their intentions about the initiative of IOCL.The
intentions gathered are divided into the following groups:
 Customers who are interested in the initiative
 Customers who are not interested in the initiative

4-Motivation:

Through the questionnaire efforts have been made to find the hidden need or
want of an individual and whether these people can be tapped as the potential
customer for NFR initiative.

5-Behavior:

 Behavior concerns what subjects have done or are doing. Through

the questionnaire the behavior of the individuals regarding the
product and their responses have been found. If the responses are
favorable then the person can be said to be our potential customer.
The primary data serves as an important tool to measure the
behavioral trend of the customer. It helps in answering few vital
questions like:
 Which factors will cause him to buy from Indian Oil?
 Where he expects from the company?
 Which products he prefers?
Thus, it helps to draw a comparison between the Purchase and the
observed behavior of the individuals.

Obtaining the Primary Data:

The data collection was primarily done through communication.

Communication involves questioning respondents to secure the desired
information, using a data collection instrument called questionnaire.

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Versatility:

It is the ability of a technique to collect the information on the many types of

primary data of interest to marketers. It has also been found that some of the
people do not answer truthfully to all the questions especially in the case of
the personal details.

Limitations and Caveats

There was difficulties/obstacle faced during the initial part of the

project, which were however overcome successfully. To list:-

1. It was difficult to break the ice with the common people initially. It was
a daunting task to convince them to fill in the personal details of the
questionnaire.
2. To convince the people for a proper interviewing process is also
difficult.
3. Some of the customers were not sure about the facility which they
would like to have at the retail outlets.

Primary Data collection Details:

19
The survey was conducted across 9 retail outlets for the avenue of the non-fuel
revenue generation in petroleum retail sector.

 The survey for NFR was conducted across 9 distributors including the
customers which are covered under the NFR initiative.
 The total number of respondents forNFR initiative was 900.
 The Retailers covered for NFR initiatives were spread across the
Lucknow city.These are :

1) Aliganj Service Station,Sector-H,Aliganj

2) Samthar Service Station, near I.T. College
3) RKBK Limited,HAL
4) Hind Service Station,Bara Birwan
5) Shri Raj Filling Station,patrakarpuram,Gomtinagar
6) S.S.R. Filling Station,Jankipuram
7) Vinayak Service Station,Mandir Marg,Mahanagar
8) Sahani fuel Centre,Viram Khand-I,Gomtinagar
9) V.M.Service Station,M.G.Marg,Cantt.

20
 OBSERVATIONS ANALYSIS &
DISCUSSION

FINDINGS

EXHIBIT 1: SERVICES AVAILED BY THE CUSTOMERS

TOTAL NUMBER OF RESPONDENTS : 900

TOTAL NO.OF CUSTOMERS WHO HAS AVAILED THE SERVICES : 715
TOTAL NO. OF CUSTOMERS WHO HASN’T AVAILED THE SERVICES : 185

SERVICES AVAILED

No; 185;
21%
Yes
No
Yes; 715;
79%

The chart above shows that out of 900 customers 715 has availed the services
already being provided and only 185 customers has not used the services. It can
be analyzed that most of the customers are aware about the services being

21
provided by the IOCL. Thus 79% has rendered the services which suggest that
the service provided by the retailers is very good but they need to inform the
customers about the service so as to gain customers faith and loyalty so that the
customer may be open for new initiatives like ATM and Convenio stores.

EXIHIBIT 2 : SUGGESTIONS FROM THE CUSTOMERS TO

IMPROVE THE SERVICES

SERVICE FEATURES

236; 26% Quality

Convinience
450; 50%
Facility
118; 13%
No Idea

96; 11%

It can be concluded from the above chart that QUALITY(of both fuel and non
fuel products) is the most important factor that customers suggest to maintain
and improve the standards of the services being provided. So,the company must
keep in mind that apart from convenience & facilities customer prefer to have
the best quality products and services.

22
EXHIBIT 3 : IMPORTANCE OF FACTORS FOR PURCHASE
ANALYSIS

IMPORTANT PURCHASE FACTOR

Price
61; 7% 11; 1%
Quality
Convininence of purchase
Variety
167; 19%

661; 73%

It can be concluded from the above chart that price is the most important factor
for customers while making a purchase decision. So Indian Oil should try to
focus on the price aspect the most and should try to make the products available
at lower or at least equal to the market price

23
EXHIBIT 4 : INTEREST ANALYSIS OF THE CUSTOMERS

OPENESS LEVEL

64; 7%
77; 9%
Yes

No

May be
759; 84%

It can be observed that 84% of customers are open to purchase their daily
household low involvement items from the petrol pumps retail outlets of the
Indian oil, if they get it at reasonable price and are of good quality and of their
preferred brand.

24
EXHIBIT 5: PRODUCT PREFERENCE ANALYSIS

PRODUCT PREFERENCE

900 814 827

800 756
700
600
489
500
400
300
200
100
0

rin
k M ys es
D AT B a tor
d e S
ol vi
c m
s/
C e r
rea
c k S c
e
S na Ic

The above chart shows that customers are open to buying low involvement
purchase items like namkeen, pickles, ketchup & ice-creams from the retail
outlets of Indian Oil. For buying high involvement and cost purchase products
they want to purchase it from market so that they have more choice in terms of
variety and price range. Thus high involvement products are not a good option
to stock.
Apart from it ,customers prefer to avail the facility ATM’s & Service bays at
the retail outlet of the Indian Oil.

25
EXHIBIT 6: ACCEPTANCE FOR NEW SERVICES

NEW SERVICES ACCEPTANCE LEVEL

59; 7%
148; 16%

Never
281; 31% Some times
Mostly
412; 46% Always

Thus as clear from the above chart considerable number of customers would
like to use the new services if they are available easily and at a reasonable rate
AND WITH DISCOUNT COUPONS. Even customers who are not open to the
purchasing at retail outlets would like to use this facility if available. Thus it is a
very good way for Indian Oil to become more like a solution provider for home
needs and increasing its brand recall value.

26
EXHIBIT 7:TOTAL NUMBER OF TWO WHEELER & FOUR
WHEELER RESPONDENTS

CAR

50;
11%

YES NO

400;
89%

TWO WHEELER

71; 16%

YES NO

379;
84%

27
Thus when the respondents were segregated into two-wheelers & four-wheelers
then it is evident from the above figure that 89% of car & 84% of two wheelers
agreed to avail the services provided by the Indian Oil and 11% and 16% of the
car & two-wheelers disagreed respectively.

EXHIBIT 8: AREA OF THE RETAIL OULETS IN SQUARE

FEETS

AREA OF THE OUTLET IN SQ. FT.

10,000;
11%
18,000;
12,000; 19%
SSR
13%
Aliganj
11,000; Vinayak
12%
12,000; Samthar
13% 3,850; 4% RKBK
8,000; 9% 7,000; 8% Sahani
11,000; Shri Raj
12% VM
Hind

It is evident from the above figure that there are five retail outlets out of the
total nine retail outlets which has the ample space ,which will be helpful in
promoting the NFR initiative by the Indian Oil Corporation as the customer
expects spacious parking facilities and good ambience.

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 EXHIBIT 9 :NUMBER OF PEOPLE WHO AGREED TO
AVAIL THE SERVICES AT DIFFERENT OUTLETS

YES

87; 11% 84; 11%

82; 11% 92; 12%
Aliganj
Samthar
Vinayak
SSR
RKBK
80; 10%
89; 11% Shri Raj
Hind
Sahani
VM
89; 11% 90; 12% 86; 11%

Thus it is clear from the above chart that out of the total 9 outlets there are six
outlets at which more than 85% of the customers agreed to avail the non fuel
products and services being offered by the Indian Oil Corporation

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 EXHIBIT 10 :NUMBER OF CUSTOMERS WHO DID NOT
AGREED TO AVAIL THE SERVICES AT DIFFERENT
OUTLETS

NO

VM; 13; 11% Aliganj; 16; 13%

Sahani; 18; 15% Samthar; 8; 7%

Vinayak; 11; 9%

Hind; 20; 17%

SSR; 14; 12%

Shri Raj; 11; 9% RKBK; 10; 8%

Thus it can be inferred from the above figure that there are only 5 retail outlets
out of the total 9 retail outlets at which more than 10% of the customers did not
agree to avail the non-fuel products/services at the petrol pumps of the Indian
Oil Corporation.

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 SWOT ANALYSIS

STRENGHTS:
 Huge customer base, with high penetration level in all areas.
 High frequency of Customer interaction.
 Customer’s satisfaction with the current service levels of Indian Oil.
 Customer’s trust on products offered by Indian Oil Corporation Limited.

WEAKNESSES:
 The acceptance level of new services is only 46%.
 Customers are finding the products costlier as the same products are
available in the retail market for cheaper price.
 The product brands do not have much demand in the market.
 The retailers involvement is low in some areas resulting in distorting the
image of Non-fuel revenue initiative.
 Customers are not getting the information that the products are offered by
the company, they perceive it as a retailer’s initiative.
 Unorganized way of selling products is not putting across a good
impression.
 The retailers are not stocking all the products simultaneously thus
reducing the choice of the customers further

OPPORTUNITIES:
 84% of the customers surveyed are interested in buying some products
from IOCL retail outlets if they are reasonably priced.
 The company does not need to make any extra investment for advertising
& marketing, because if the products are good word of mouth will be an
effective advertising medium.

THREATS:
 The opening of Reliance and Star bazaar (Tata Group), which compete
mainly on the basis of price.
 The availability of multiple brands at these outlets also gives the
customer a wider choice.

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  The consumption of the daily household and sundry items are mainly
from the local retail outlet.

CONCLUSIONS
All the conclusions have been drawn from the data gathered through interviews
with the customers based on the questionnaire.

 The total number of customers who has availed the services are
79%,which itself is a good sign for the potential growth in the NFR
generation initiative.

 In order to tap the 21% of the customers the retailers need to convey the
motive of the company to the customers.

 In total 50% of the respondents does not have any suggestions inorder to
enhance the quality and the type of services to be provided at the retail
outlets.

 `Also 84% of the total respondents are ready to purchase the items like
Snacks,Cold-drinks & ice-creams,which are of the low involvement type.

 The customers are more inclined towards the services like ATM’s and
Service Bays(viz. washing,wiping,lube changing etc.).

 The acceptance level of the customer for the new services is merely 31%.

 It is so because the customer is confused about the quality of the non-fuel

products as well as the motive of the company.

 The acceptance of the services among the four wheelers i.e. the car
drivers are quite high i.e. 89%.

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 Though the acceptance level of the new services among the two wheeler
customers is also significantly high,but is less as compared to the four
wheeler customers.

 At all the retail outlets ,the most important factor that influence the
buying behavior of the customer is PRICE of the product.
 Among the two class of customers mostly four wheelers preferred the
quality of the non-fuel product (106 of 167 i.e. 63.5%).Therefore the
corporation should tie up with reputed companies only.

 Only 11% of the total respondents suggested to enhance the facilities at

the retail outlets ,which suggest that most of the customers are satisfied
with the facilities provided at the retail outlets.

 9% of the total respondents refused to buy any products from the

Convenio stores at the retail outlets of Indian Oil.

There is always scope of improvement, corporation should try different

things so that the awareness level of the customers regarding available
facilities at the retail outlets can be communicated to the potential
customers.
Thus it emerges from the analysis that efforts should be made to improve
the standard of the services provided to the customers..

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 RECOMMENDATIONS

 Proper training should be given to the deliveryman/serviceman to inform

the customers about the initiative by the company in a better way.

 IOCL can try to get the retail manager as well as head of service staff
involved for this and he can be instructed to call the customers and tell
them about the initiative in detail and in clear terms so that the customers
do not get confuse it with the Lucky Draw/Lucky Coupon initiative.

 The customers should be made aware of the fact that this initiative is
started by the company itself and is under the constant supervision of the
company.

 The area covered under the NFR initiative should be such where the
density of the customers are more and the products/service provided by
local retailers is few in order to have a better impact of the initiative.

 Monthly targets should be given to the service staff in terms of

informing around 200-300 customers about the company’s NFR
initiative and a random survey should be conducted by the manager.

 The convenio stores should be at those retail outlets only where there is
ample space to accommodate a fair number of customers and it should be
ensured that the outlet has the parking area as well( like SSR service
station, Jankipuram has 579*319 metre sq. area).

 Also there should be adequate number of staffs at the retail outlets to

cater to the fuel as well as non-fuel products/services needs of the
customers(like SSR,Shri Raj,Aliganj & VM Service stations has 25+
staffs respectively)

 IOCL should try to use all the channels of communication it has with
the customers to increase the awareness level of the non fuel revenue
generation initiative of the company.
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 The channels can be the serviceman, by printing the logo or name of the
products on the receipt which is given to those customers who purchase
fuel products, by informing them about the special prices of any
particular item when the customer comes at the retail outlet , by issuing a
rate list in Hindi and English and by giving it to the serviceman to show
to the customers.

 Most of the sale is expected to be done through the serviceman at the

moment of delivery .Therefore, IOCL can try to make it compulsory for
the serviceman to carry the products with him and show the customer
the rate list so that impulse purchase may take place.

 Products which can be included in the product basket should include

products towards which the customer brand loyalty is low so that the
customers may go for impulse purchase on seeing attractive packaging
and offers.

 IOCL can try to ensure that the products which are supplied by the
suppliers should have the Indian Oil logo.

 Some of the products which can be promoted are pickles, ketchups,

papads, various kind of mix, namkeen, matchboxes, biscuits etc.These are
low involvement products and even the customers are not aware of
their exact price in the wholesale or retail market and so chances of
comparison are less and also brand loyalty towards these products is less .

 USP can be achieved by giving the customers some “points” on the

purchase which can be redeemed for the fuel products/services at Indian
Oil Petrol pumps, something working on the same principle as the
Petrocards/Fleetcards, it should be a program for customer loyalty.

 Thus on the basis of the total area of the retail outlets and the high
percentage of acceptance from the customers to avail the non-fuel
products & services of the Indian Oil at the separate petrol pumps & the
total frequency of the customers per hour, I suggest the following 5
petrol pumps which has greater potential for the NFR initiative of the
company.These are :

1)SSR Filling Station,Janakipuram

2)Aliganj Service Station,Aliganj

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 3)RKBK Limited,HAL
4)Shri Raj Filling Station,Patrakarpuram
5)V.M.Service Station,Cantt.

REFERENCES

Books:

1. Churchill & Brown;Basic Marketing Research;Thomas Publications,5 th

edition
2. William O. Bearden, Richard G. Netemeyer, Mary F. Mobley; Handbook
of Marketing Skills; SAGE Publications.
3. “Malhotra Naresh(2002),Marketing Research” , Prentice Hall of India.
4. “Kotler Keller(2006),Marketing Mangement”
5. “Business Research Methods”, Tata McGraw Hill ,9th edition

Websites:

1- www.indianoil.com
2- www.shell.com
3- www.google.com
4- www.ficci.com
5- www.hindubusinessline.com
6- www.shell.com
7- www.bp.com
8- www.wikipedia.com

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 QUESTIONNAIRE
Indian Oil Corporation Limited

The following questions will help us serve you better. So kindly

a few minutes to help us serve you better. Thank You

1- Name: ………………………………………..........................................s

2- Address: ……………………………………...........................................

……………………………………….........................................

3.Type of Vehicle & Vehicle No.: ................................................................................

4.Mobile/Landline No. .....................................................................................

1) Have you purchased any other product from the petrol pumps of India
(or rendered any service like ATM etc.) other than oil & petrol?

Ans.)..................................................................................................

2) Would you like to suggest any measure to improve the services of the
pumps currently being provided or would you like any other service?

Ans.)..................................................................................................

3) When you buy your grocery & other household items which factor is
37
  Quality
 Convenience of Purchase
 Variety

4) If Indian Oil promises you a assured quality of grocery & other sundry
items,at reasonable price,on a continuous basis,would you like to purchase from
the retail petrol pump outlets of Indian Oil?
 Yes
 No
 May be

5) Which of the following products would you be ready to purchase from Indian
Oil petrol pump outlets rather than market & be assured of its quality& price?
(Please tick whichever is applicable)
 Basic grocery items
 Namkeens/pickles/Ketchup/cold drinks
 Cook wares & Cookers
 BSNL/Airtel/Idea/Vodafone vouchers
 ATM
 Service bays
 Ice-cream Store

6) Would you be willing to buy the basic grocery & other household products
from Indian oil Petrol pump outlet if you receive a COUPON from him
,depending on the amount of purchase,which can be redeemed when you buy
petrol from an Indian Oil petrol pump?
 Never
 Sometimes
 Mostly
 Always

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