Z cautious on rebranding Shell stations

Z CEO Mike Bennetts says the company already has a mass of customer feedback to analyse. Photo / Dean Purcell

The owners of fuel company Z will spend the next few months poring over research on a pilot station rollout before deciding whether to spend $35 million on a full rebranding of Shell service stations.

The 10-station pilot programme was completed in Putaruru last week and Z chief executive Mike Bennetts said if the remaining 210 stations were rebranded, it was important to get the template right from the start.

"We'll take a few more months for a true understanding of what the customer is looking for. I don't want to roll out another 50 and realise the pie warmer needs a lip on it when I've ordered 48 units."

Z has the use of the Shell brand until 2014 but it is understood that it costs about $7 million a year in royalties.

"It's relatively more economical to use our own brand than someone else's but we're very conscious we want to use our money wisely because if we don't the customer thinks we'll charge them more because we've cocked it up."

Z is jointly owned by the New Zealand Superannuation Fund and Infratil. The brand was launched in May, with the first pilot station opening in Greenlane, Auckland in June.

There are now three stations in Auckland, two each in Wellington and Christchurch and others in Waiouru, Turangi and Putaruru.

Bennetts said tracking data to assess the effectiveness of the Z brand would be completed in a month and the company already had a mass of customer feedback to analyse as well as comparative sales figures for rebranded stations.

"In some senses we get to see very clearly how our sales performance is going, compare it to a control group, compare to other pilots and compare to week on week."

A group of 200 randomly selected customers were providing feedback through smartphones, the company's website and an 0800 number for small rewards.

This was providing more information than the traditional method of employing mystery shoppers once a month to check service against a standard list.

Raw data showed customers were valuing extra forecourt service and many who previously did not know the chain was New Zealand-owned, now did.

Industry-wide fuel sales had been sluggish during winter as prices topped $2.20 a litre.

Bennetts said it appeared the Z sites were bucking that trend with a "small uplift" in fuel sales and there were signs of a recovery.

"The last month has been a reasonably good one for us. August was noticeably different from the three months before that."