Indian Oil Corporation (IOC) has chalked out an aggressive expansion plan. The state-run oil major has decided to enhance its retail operations by setting up over 10,000 retail outlets by the end of the current financial year.
The oil major plans to add over 1,000 new retail outlets by December, 2005. The annual spends on retail expansion is estimated to be around Rs 500 crore.
“We have already opened over 1,000 retail outlets in 2004 and in 2005 we plan to open over 1,000 new retail outlets across the country. We will have in excess of 10,000 retail outlets by the end of the current financial year,” S K Swaminathan, executive director (lubes), marketing division, IOC told Business Standard.
The corporation has appointed Leo Burnett to promote its retails outlets and retail-related offerings. Bulk of the promotional spends, which comprises all forms of advertising and marketing support, will be focused on IOC’s flagship lubricant brand, Servo.
The budget spent for Servo is estimated to be Rs 30 crore. The brand commands a 40 per cent share of the Rs 5,000 crore lubricant market.
For the retail outlets, the corporation plans to promote its petrol stations as brands, in addition to promoting the offerings at the outlets such as branded diesel, branded petrol and branded cards amongst others.
At present, IOC’s marketing network is spread throughout the country with over 22,000 sales points, the largest in the country, which include petrol and diesel stations, consumer outlets, lube distributors, servo shops, and LPG distributors amongst others.
The corporation commands over 53 per cent of the petroleum products market share, 41 per cent national refining capacity and 76 per cent downstream pipeline transportation network in the country.
IOC is the lone Indian company to feature in the Fortune 500 list. It is also the 17th largest petroleum company in the world.
The corporations concept of ‘Jubilee Retail Outlets’ has also been launched to set up petrol and diesel stations on highways with comprehensive value added facilities for various customer segments, such as truckers, farmers, tourists and passenger transport amongst others.
The Jubilee Retail Outlets include motels, restaurants, parking lots, weighbridges, sale of tyres, batteries, accessories, agricultural machinery repairs and recreational facilities provided selectively.