Today, many forward-thinking gas stations are increasing sales, attracting affluent new customers, and creating a new stable revenue stream with electric vehicle charging stations.
By offering fast and ultra-fast charging stations, gas stations are tapping into an exploding market and setting themselves up in the rapidly evolving future of mobility. The need for fast charging stations has never been more prevalent and fuel retail businesses across the globe are perfectly suited to offer high-powered stations and facilitate this increasingly urgent need.
Beyond the charging stations themselves, offering EV charging can attract a well-to-do and dedicated clientele who will go out of their way to charge conveniently. Additionally, these coveted consumers often have more time to spend at a gas station whilst charging than traditional fuel retail customers, giving businesses the opportunity to cross- and upsell additional products and services.
The consulting firm’s report puts it bluntly: “In a market environment in which electric vehicles, autonomous vehicles, and new mobility models take off rapidly, up to 80 percent of the fuel-retail network as currently constituted may be unprofitable in about 15 years.”
As a number of far-reaching trends are colliding, gas stations are facing a critical moment in their history. Aside from the rapid growth in demand for electric vehicles, the rise of the sharing economy, combined with consumers’ exceeding expectations for greater convenience, quality, and personalization have created a new environment for the fuel retail industry. And in turn, many are looking to EV charging stations as a solution.
EV chargers attract customers with more money to spend
EV drivers are a highly sought after market: The average EV driver is employed, more educated, and wealthier than the average citizen.
As a result, EV drivers have more time and money to spend at charging locations than drivers of traditional vehicles. By targeting EV drivers, fuel retailers are not only adding a new revenue stream to their gas stations, but also creating upselling opportunities with this well-to-do clientele.
Create a new, stable revenue stream with EV charging
With EV charging, gas stations can create new stable revenue streams that compliment their traditional offering by setting fees for charging sessions.
With today’s technology and available digital management systems, it’s possible to set it up in whatever way works best for them. For example, you could set flat fees for each transaction, a price per kWh consumed and per minute, or charge entirely different fees during low-utilized and rush hours.
Technological advances in smart charging have also helped the process of optimizing EV charging so fuel retailers can earn more and worry less. With smart charging, gas stations can now set fees according to grid availability, optimize EV charging infrastructure and minimize the load impact (demand for electricity) of EVs. For more information, this ebook gives a detailed overview of how much you can earn and the different pricing structures for EV charging.
Electricity is more predictable than traditional transportation fuels
Electricity is more predictable, less volatile compared to fuel and is increasing consumer demand compared. As a fuel retailer, you already know that the margins on gas are, at times, negligible. There may be weeks or even months when oil prices rise and some locations struggle to make a profit on gas. Whilst these fluctuations are out of your hands, they have a direct effect on your business.
Traditional transportation fuels have experienced significant fluctuations since the beginning of the century. According to research by the US Energy Department, the retail price for a gallon of transportation fuels (petrol, diesel, propane, ethanol etc.) is highly volatile and differed by $2.90 over the period between 2000 and 2016 from a low of $1.46 per gasoline-gallon equivalent (GGE) to a high of $4.36 per GGE. Electricity, however, was much more stable, fluctuating between a low of $3.47 per GGE to a high of $4.51 per GGE, a $1.04 difference.
As electricity tends to fluctuate more with the temperature as opposed to global economics, forward-thinking gas stations are turning to EV charging as a way to create a new predictable revenue stream.
EV charging gives fuel retailers large upselling opportunities
No matter how fast fast charging gets, it will still take longer than fuelling up a tank, allowing the driver to spend more time at your location and creating more upselling opportunities for your fuel retail business.
According to an EY report, fuel retail companies must optimize their reach to customers through hyper-localization and hyper-convenience. This means letting go of the “one-size-fits-all approach” and adopting a tailored offering based on the demographics of customers visiting a store. Such demographic information changes when gas stations offer EV driving, opening up opportunities for fuel retailers to create a customized retail experience for this market segment.
EV drivers generally have more to spend than non EV drivers, this means that they could be interested in higher-end goods that can bring in more profit for fuel retail businesses.
EV charging also gives gas stations more flexibility in creating this offering. Besides EV charging, fuel retailers have two options for additional services—adapt your offering based on time/money people have to spend or adapt charging speed based on time you want your customer to stay. This flexibility opens up a myriad of opportunities to fuel retail businesses to branch out of the traditional convenience store offering.
Whether it’s drivers sitting down to have their morning coffee or a bite to eat, collecting their delivery parcels, or doing a modest grocery shop, EV chargers give gas stations the opportunity to offer premium products and services at a higher price point.
Whether it’s swapping out the push-and-pour coffee machine for a barista or a fast food chain for an independent, craft burger joint, these opportunities will help fuel retailers get ahead with customers of the future.
Converting to an EV Gas station doesn’t affect regular business
Fuel retailers have always adjusted their offering to consumer demands. From manned pumps to self service, from car wash to convenience stores, gas station owners have always adapted to the times and needs of their customers.
The electric mobility transition is no different. With millions of EVs on the roads, the need for a suitable fast-charging infrastructure has never been higher. Gas stations are perfectly positioned to capitalize on this growing social trend and future-proof their business at the same time. In fact, they can even do so without affecting their regular business.
For many fuel retail businesses today, EV charging is an addition to, not “in-place-of”, a traditional transportation fuel offering. Fast charging stations can be installed in parking spots and don’t have to take up significant space. Visible on EV charging maps, like Google and Apple maps, these charging stations can also enhance a gas station’s visibility and help EV drivers find a place to charge.
By widening the scope to catch potential EV customers, fuel retailers are also addressing consumers' evolving environmental consciousness. Electric mobility is quickly becoming a success story of the environmental movement and many consumers look to EVs as a key tool in the fight against climate change. According to our research, this is true for the majority of citizens on both sides of the Atlantic, not just those who own an EV or are considering purchasing one.
With this in mind, many forward-thinking fuel retailers are looking to EV charging as an opportunity to add a new, stable revenue stream, upsell well-to-do customers with additional products and add an element of environmental awareness, all whilst future-proofing their business.
Learn what fast charging can mean for your business
Read our free ebook to get a complete overview of all fast EV charging possibilities, their differences, and what fuel retailers need to look out for.