Forecourt Trader - 30 years at the heart of the fuel retailing community

Ring leaders

01 August, 2003
With the mobile phones sector developing at an astonishing rate, ensure you cash in on the burgeoning top-ups market
Page 27 
The mobile phones market is undergoing something of a revolution. Recent years have seen the emergence of wireless internet access and picture messaging, and now video messaging and the advent of 3G promise to keep people connected everywhere at all times. This spells great news for retailers because the more consumers use their phones – and these new services don’t come cheap – the more airtime they need.
The total mobile phones top-up market is worth more than £3bn with forecourts holding a 6.5 per cent share, according to TNS data. E-top-up was first launched in 2000, and in those three years it has gone from accounting for nought to 63 per cent of the top-up market.“E-top-up has overtaken the vouchers market and we expect it to reach 70 per cent by the end of the year,” says Ian Haynes, head of channel marketing at Vodafone.“E-top-up is growing because it benefits us and the end consumer through more choice of denominations. For the trader, there’s no stock holding so no shrinkage issues – it’s in everyone’s interest.“One common thing with the scratchcards is if you scratch too hard, you scratch the number off, which causes problems. With e-top-up, you get rid of all the negatives.”e-pay, a wholly owned subsidiary of Euronet Worldwide and provider of e-top-up solutions, says the forecourt sector plays an important role in this dynamic market.“The market for e-top-up grows steadily each month as an increasing number of consumers use their swipe cards,” says Andrew Dellow, UK sales & marketing director at e-pay. “Networks implement a number of strategies to encourage and accelerate the growth of electronic purchases, such as removing vouchers from the market. For example, T-Mobile just announced the removal of the £10 voucher following in the footsteps of Orange.“Forecourts offer a quick and convenient location in which consumers can top up their pre-paid cellular accounts, representing an important sales channel for mobile operators,” adds Dellow. “Customers buy pre-paid airtime on a regular basis as a distress purchase because they have run out of airtime or as an impulse purchase when filling up.”To maximise sales in the mobile phone top-up market, usual category management disciplines apply.“It’s important to display point of sale so the customer is in no doubt that they can top up in that outlet,” says Vodafone’s Haynes. “There’s potential growth if the retailer can sell higher denominations, which are incentivised by the networks through promotions. These benefit the retailer because they get a share of a higher amount of money. And the results for the market are higher usage.“Margins are not fantastic, but they’re not bad,” adds Haynes. “The main thing to worry about is that the best way to grow profit is to try and sell more top-ups. We are investing in making sure that happens through developing the 3G network, and investing in products such as Vodafone Live – all of which generate more revenue and will filter down to the retailers. It will generate incremental usage, which will inevitably grow the top-up market.“Margins were better at the launch, but hardly anyone owned a phone then. The main thing is that retailers support initiatives to grow incremental sales. Top-ups are a big footfall driver – there’s still a lot of growth to be had.”SELF SERVICESelf-service top-up could be the next phase in the market. “Self-service is for those retailers that want to try and free up time and automate things. We’re only in the testing phase at the moment,” points out Haynes.“I could see a role for it in forecourts but I don’t know if volume is large enough in forecourts at the moment – I think they will be at the end of the rollout.”Coinstar has just launched a self-service e-top-up kiosk that allows customers to quickly and easily top up their pre-paid mobile phone airtime. Retailers can operate the kiosk on a revenue sharing scheme. Installation is free and the retailer gets paid every time someone tops up their phone.“The forecourt is one of the main areas we’re looking to rollout in,” says a spokesman for Coinstar. “It’s a convenience service – there’s no need for customers to queue at the checkout and no need for retailers to order top-ups.”Eventually consumers will also be able to buy ringtones, games and logos from the kiosk.ACCESSORIESPending legislation on the use of mobile phones while driving means the accessories market is likely to be in for a massive boost.According to Dextra Accessories, there’s potential for the whole market to be worth up to £3bn.“Depending on the type of car solution kits bought, the market could be worth anything from £110m for £9.99 price points, up to £3bn if every one of the 11 million users bought a £250 in-car kit,” says Sarah Massey, marketing manager at Dextra. “On average, the profit on return is in excess of 30 per cent so it is worth giving space to the category.”The mobile phone accessories company advises forecourts to stock a limited number of different hands-free car solutions – at, for example, £9.99, £20 and £40 price points.“It needs to be kept simple because forecourts won’t have experienced staff – the products need to sell themselves,” explains Massey. “There are lots of different handsets on the market so the car solutions need to be universal.”Dextra is currently working on a solution for the display of mobile phone accessories in forecourts, but Massey says the ideal position is on the counter top. “The display should show how the product will look in the car itself,” she says.



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Weekly retail fuel prices: 10 June 2019
RegionDieselLPGSuper ULUL
East135.3166.90140.93130.00
East Midlands134.59140.57129.69
London134.50141.91130.33
North East133.19142.40129.15
North West134.1363.90139.73129.13
Northern Ireland131.34135.32128.05
Scotland134.25140.07129.86
South East135.2562.40141.74130.52
South West134.5167.90140.57129.57
Wales133.6764.90137.30128.83
West Midlands134.34140.64129.70
Yorkshire & Humber133.72140.40129.24

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