On the Brandwagon

FROM THE SEPTEMBER ISSUE: Prime the Pump has branded E15 as Unleaded88, with a strategy in place to expand the name and pump design across the industry.
By Lisa Gibson | August 17, 2018

After two years of customer surveys, interviews and branding experiments at large retailers in the U.S., Growth Energy’s Prime the Pump initiative has landed on what it says is the best-suited name for E15: Unleaded88. Many of the 20 large retailers that participated in PtP plan to make their full branding switch beginning this fall, according to Mike O’Brien, vice president of market development for Growth Energy.

Currently, 1,400 stations across the country are selling E15 blends through PtP, and soon will update their branding to Unleaded88. A total of 2,800 stations are committed to selling E15 through PtP, meaning Unleaded88 will account for 3 percent of the total fuel sold in the U.S., O’Brien says. If current retailers committed to the brand through PtP continue to expand, the path for a 15 percent market share is already laid out, he adds. And that’s the tipping point. “That’s a big chunk of the market,” he says. “People pay attention. Competition happens.

“If we didn’t do anything more, just work with our current retailers and keep building out, there’s a path to 15 percent of the market. And that’s when the market takes off.”

Crucial to that market takeoff, O’Brien and others emphasize, is a consistent brand that customers recognize and understand. Enter Unleaded88.

A main goal of PtP is to establish a consistent brand for E15, which goes by numerous names at different retail stations across the country. Through surveys, interviews with more than 4,000 consumers—including many right at the pump when decisions are made—and branding tests that evaluated customers’ responses to certain names, PtP settled on Unleaded88, O’Brien says. Retailers also can use the name Regular88, depending on their current fuel marketing guidelines. “’E15’ is a foreign name for customers,” he says. “They’re used to ‘unleaded.’ They’re used to ‘regular.’”

Branding E15 as Unleaded88 in PtP experiments showed an increase in sales of 16 percent, vastly larger than any other names tested, O’Brien cites. The name “E15” showed a sales increase of just 3 percent, and various uses of the term “Eblend” showed increases of up to 10 percent. “We really analyzed the consumer reaction to everything,” he says. “They’re used to buying unleaded. They’ve been buying it for 30 years. This is the way they buy fuel. So our intent here is this is just like the other fuel, just a little better.” Use of the word “ethanol” didn’t come across negatively in brands, but it also didn’t boost sales, O’Brien notes.

Unleaded88 will be presented with blue signage and tags such as “Engine Smart. Earth Kind.” or “Burns cleaner. Higher Octane.” On the pump design PtP is pushing, Unleaded88 will appear on the left, likely accompanied by pump toppers and a video Growth Energy is preparing for fuel pumps equipped with screens.

“They’re already selling these unleaded varieties, and we’re unleaded as well, but now you call it 88 because of the octane,” O’Brien says. “That takes away some of the fear of it. But, unfortunately, because the hose is to the left, we have to call it out a little bit.

“We want Unleaded88 to be this intuitive thing that people just do because that’s what they do. We’ve just got to get them over that initial hump. We’ve worked really hard to build out this approach. We have a branding playbook that we give to retailers.”

Competition by the Book
For the “big 20,” as O’Brien calls them, switching to the new brand will be simple, as PtP is equipped to help provide funding and knowledge as needed for the transition. Casey’s General Store, which has been working with PtP, already has E15 branded as Unleaded88 at a few of its stations and will continue its rebranding effort with overlays and road signs, says Nathaniel Doddridge, director of fuels for the retail chain. Forty of the company’s stations offer E15 now, he says, with a commitment to upgrade 10 to 15 more. Moving forward, all new stations will offer the Unleaded88 brand, as well. So far, the branding technique and name have been accepted well by customers, he says.

Initially, Casey’s had an agreement with PtP to help get traction with E15, Doddridge explains. “Historically, we haven’t been a fast mover when it comes to changing our product specs in regard to fuel.” But the PtP program showed that Growth Energy had enough industry knowledge to guide Casey’s in the initiative, he says.

Doddridge says Unleaded88 is an ideal name for the product, as it’s recognizable and not overwhelming to consumers. Most people don’t even know regular fuel contains 10 percent ethanol, he says. “In a lot of customers’ eyes, fuel is fuel.

“When you start talking about percentage of ethanol, customers get a little skeptical and a little uneasy. So 15 percent ethanol really creates a lot of confusion in our customer base.” An overwhelming number of options at a pump causes the paradox of choice, O’Brien and Doddridge say, prompting customers to default to their usual selection. Most people just look at octane and price, O’Brien adds.

But how will it spread beyond the big 20? Competition, of course. “Other retailers will look at us and realize this is a competitive advantage,” Doddridge says. “Once other competitors of ours start to see that this product is creating value that they’re not getting, I think you’ll start to see more and more bend a little bit and start offering this. We’ll naturally navigate to the most common product name.”

It seems to be happening already. Randy Gard, chief operations officer for Bosselman Enterprises, says the company’s Pump & Pantry stations across Nebraska likely will adopt the Unleaded88 name and look, despite the fact that Bosselman is not among the big 20 and hasn’t been working with PtP at all. “We may jump on that bandwagon for that because it’s spot on,” he says of the name Unleaded88.

Currently, Pump & Pantry brands its E15 as Clean88, but isn’t “married to” the brand, Gard says. “Consumers know what unleaded is. They’re accustomed to seeing it.”

But branding across the industry isn’t easy, Gard cautions. “It’s always been difficult to get retailers on the same page with a consistent dispenser overlay that consumers become accustomed to. … I think it needs to be a team effort. Growth Energy’s biggest obstacle is to try to pull together retailers to get that brand consistency.”

Pump & Pantry’s E15 sales in 2017 were up 400 percent over 2016, selling at 5 cents less than E10, Gard says. That’s without any additional promotion or marketing. It’s foreshadowing of what Unleaded88 as a brand could do in the marketplace, essentially forcing the transition at all retailers, just to maintain market share. “If you’re a small retailer, quite frankly, the faster you go there, the better off you’re going to be.”

Bosselman has worked with the state of Nebraska, which has some grant money through USDA, in updating its stations in Lincoln and other large markets to sell E15. Two more locations are set for updates to tanks and blender pumps, and likely will start selling E15 as Unleaded88 right away, he says.

Assistance from the state helps Bosselman fund the transition and pump upgrade, PtP will help some of its participating retailers, but many others won’t have funding assistance. Still, the switch will be crucial for business and a wise move, O’Brien and Gard agree. “Do we wish we had more money to help expand that and buy blender pumps? Sure. But that’s not going to stop us.” Retailers can inquire about funding from state agencies or corn growers’ associations, O’Brien says.

Gard cautions about misinformation regarding whether retail stations are equipped to handle E15. Most infrastructure is, he says, and small retailers should contact their infrastructure distributor to ensure their pipes and tanks are compatible. “The truth is, the majority of infrastructure can handle E15,” he says.

Gard told Ethanol Producer Magazine that Bosselman would reach out to Growth Energy right away to discuss the branding and consistency at its locations. “We’ll probably follow that lead.”

O’Brien says PtP is working to get marketers on board with Unleaded88, which should prompt branded oil to adopt the Unleaded88 brand, or face losing market share like any other retailers who don’t transition. Some terminals are starting to sell E15, he says, and the key to getting “mom and pop” retailers on board is breaking the brand guidelines.

RVP Obstacle
Of course, it’s clear to anyone in the ethanol industry that, in the absence of a Reid vapor pressure waiver, retailers might not jump on that bandwagon, if they’re not already selling E15. Gard and Doddridge are unconcerned and explain it away using the principle of demand.

“It is an issue, but at the end of the day, the demand for that product is going to force the RVP waiver to get taken care of,” Gard says. “It’ll be an obstacle this year, but I’m confident that, hopefully by the RVP season next year, that that’s nothing but a bad memory.”

Doddridge says, “Retailers are still on edge about the 1-pound waiver, but that will be the tipping point for the product.” When the waiver is issued, the ripple effect will take off throughout the industry, he says. “We’re optimistic that there has been enough positive traction that we feel like we’re not two years out and really hopeful next year will be the year we finally cross that threshold.” Other stumbling blocks, such as noncontainment areas, have crumbled, he adds, and this is just another. “If we pound that drum loud enough, it’s eventually going to happen.”

Sales figures show a large appetite for Unleaded88, Doddridge says. “We want to sell the products that customers want. If customers are asking for it, why wait to give it to them?”

And if a 95 RON high-octane standard is eventually implemented, the Unleaded88 market will only burgeon further. “I truly believe it must be met with ethanol,” Doddridge says.

With an RVP waiver, at a minimum blend rate of 15 percent, the 9,300 retail stations represented by the large retailers PtP is working with could achieve additional ethanol sales of 1 billion gallons per year, O’Brien says. “I think it’s doable. I think it’s pretty reasonable.”

And there’s room for brand adaptation if higher blends become the norm, O’Brien assures. For instance, if E25 has a 95 octane, the brand would be Unleaded95, he says.

“There’s room for evolution,” Doddridge says. “I don’t think it’s beyond the realm of possibility to say Unleaded88 could become the standard.” That would open the gateway for E20 and E25 to enter the market next, he adds.

Author: Lisa Gibson
Editor, Ethanol Producer Magazine