The Indian Petroleum Industry: Towards Branded Fuels

            
  
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Case Details:

Case Code : MKTG059
Case Length : 12 Pages
Period : 2002-2003
Pub Date : 2003
Teaching Note :Not Available
Organization : HPCL, BPCL, IOC Etc
Industry : Petroleum
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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The Launch of Branded Fuels Contd...

In December 2002, another company, IBP,4 launched a new brand of premium grade petrol 'Josh' and a premium grade high speed diesel, 'Shakti'. Within a short span of time, the country had seen the emergence of an entirely new market category.

According to industry observers, this trend was in line with the global trends wherein petroleum companies tried to build a loyal customer base by branding petroleum products.

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As petrol and diesel had traditionally not been seen as categories with much scope for product differentiation, branding of these products came as a welcome change.

It was a conscious and proactive effort of the companies towards brand building, in the wake of the radical changes taking place in the industry since the beginning of the country's economic liberalization in the early 1990s.

As the industry became more competitive and customer-driven, companies needed to focus like never before on marketing strategies.

The first significant development in this direction was the 'conversion' of petrol pumps (gas stations) into retailing outlets. The launch of branded fuel seemed to be the next logical step for the companies...

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4] IBP was first incorporated as Indo-Burmah Petroleum in the Burma (now Myanmar) in 1909. The company became a subsidiary of IOC in 1970. The government acquired IOC's stake in 1972 and IBP was established as a separate public sector enterprise. It was classified as an independent oil marketing company in 1989. In 2002, IOC acquired a 33.58% stake in IBP. The principal business of IBP is the storage, marketing and distribution of petroleum products.

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