What Propane and Heating Oil Companies Can Learn from Car Dealerships About Digital Marketing

Posted on March 4, 2021

Fuel companies and auto dealerships share a remarkable amount in common. Many are family owned, in business for generations. Both are essential businesses, selling products to consumers who have many options from which to choose. They need to battle to retain customer loyalty and to attract new customers. Both are seeing increased consolidation and the emergence of large competitors with deeper pockets. And both are facing radical changes in the ways their customers evaluate their options, find people to buy from and buying decisions.

It is this last point—how customers make buying decisions—where one of the key differences has started to emerge. After a slow start, auto dealerships have fully embraced the power of online and social marketing and shifted the vast majority of marketing dollars to digital tactics. Fuel delivery and service companies have been much slower to make that shift.

The recession of 2008 upended the automotive industry and accelerated its pivot to digital marketing in order to recover. Cayce Lindsey, who is now regional sales manager at Warm Thoughts Communications, started working in the automotive industry during this shift. He helped dealerships throughout the country take advantage of online tactics that could generate leads and sales more effectively, at lower cost. He also helped enhance service profit centers.

Familiar Territory

Cayce Lindsey

When Lindsey joined Warm Thoughts at the end of 2020, he didn’t expect to see much overlap between the two industries. In speaking with propane and heating oil companies, Lindsey finds that although they have much in common, their approaches to marketing differ. “The fuel industry is several years behind the automotive industry,” said Lindsey, specifically referencing their digital marketing strategies.

He recalled that when he began working in the automotive industry nearly a decade ago, “the marketing spend was split, with 70% spent on traditional media and only 30% on digital.” However, when he left the auto industry in 2020, those numbers had shifted to an “80% spend on digital with only a 20% spend on traditional.” In Lindsey’s experience, this shift in spend was accompanied by growth, particularly in lead generation through traffic to company websites.

Warm Thoughts recently conducted a benchmark survey of 60 fuel companies. The results revealed a split reminiscent of where the auto industry was about eight years ago. Most propane and oil companies still spend a majority of their marketing dollars on traditional advertising. What’s more, they are not taking advantage of many of the more sophisticated tactics that can significantly boost response, in part because they don’t understand them.

Proven Marketing Strategies to Explore

Based on successes he observed in the automotive industry, Lindsey shared four opportunity-making marketing strategies that have proven successful.

1. Build mobile-first responsive websites.

As of October 2020, over 48% of all web traffic came through on mobile phones. In 2010 that number was less than 4%, so we’ve seen a drastic increase in a short period of time. In order to win at the digital game, fuel companies need websites that are friendly for mobile phones, tablets and desktops. In addition, companies need to run litmus tests ensuring that the web design and code is beautiful yet error free when loaded by multiple operating systems. Finally, they need to build these sites bearing in mind that inevitable, frequent updates will surely affect how their customers interact with their websites.

2. Implement a robust blogging and SEO strategy.

One key element in Lindsey’s automotive experience was helping companies win the search engine optimization (SEO) competition to rise in Google’s rankings. Lindsey said that when working with auto dealers, “the goal was to have a significant majority of website traffic be driven by organic search. It’s like having a sales and marketing team that works 24/7.”

“Effective SEO is complicated, and, frankly, it baffles many typical business owners. Plus, Google often changes the ground rules. They don’t focus nearly enough effort and dollars to make this a strength. But in many respects, it is the most effective way to ensure you are ‘in the conversation’ when a consumer decides they want to buy something or make a change.”

For auto dealers, blogging was a big part of their marketing strategy, as well as using effective “keyword” strategy in the copy and structure of their websites. “Auto dealers learned that Google owns the board, and you’ve got to play by its rules if you want to get in the game,” he said.

Fuel companies, Lindsey finds, are way behind in this regard. “Many of the propane and oil companies I talk to don’t even realize that their company isn’t showing up in many towns they service when someone types in keywords like ‘propane company near me,’ ‘quality oil deliveries,’ or ‘water heater options.’ They think their ‘web guy’ is doing the ongoing work needed to win the ranking competition, and it’s just not happening.”

3. Make Social Media Your Ally

Lindsey highlighted dealerships’ use of social media as a way to connect with customers. “I had one dealership with a YouTube channel that had over 160,000 followers and another dealership with 80,000 followers on Facebook,” he said. “They also posted about topics that were related to cars but not self-promotional.”

It’s a strategy that propane and oil companies can incorporate as well. Social media, particularly Facebook, are phenomenal ways to build and expand your brand, in the same way that traditional TV advertising used to work. Unfortunately, most fuel companies make serious mistakes that undermine their social effectiveness.

“When I look at fuel company efforts, too often I see missed opportunities. They either post too infrequently for Facebook to serve them up to followers, or they do too much pure business, not enough fun and engagement. They are also not taking advantage of all the ways you can pay Facebook to advertise your brand and services in amazingly targeted ways. This advertising capability is why Facebook is one of the most profitable companies in human history, and fuel companies are completely missing the boat on this tactic.”

4. Generate positive reviews.

Lindsey emphasized the importance of generating positive reviews as an approach for attracting new customers. The automotive industry was likely the first to master the process of generating positive reviews. Think back to the last time you bought a car: Did the salesperson ask you to write them a review or respond to a survey? This positive experience is cultivated from the moment the customer expresses interest through to the close of the sale—and beyond.

His dealerships were hyper focused on calling prospects, following up on questions, making appointments, emailing, and performing other outreach as needed. According to a 2020 survey, 87% of customers read online reviews for local businesses and 92% said negative reviews make them less likely to use a business.

“Many fuel companies have not structured an approach for regularly recruiting five-star customer reviews, even though the overwhelming majority of their customers really like them,” he said. “This is a significant missed opportunity.”

The good news, according to Lindsey, is that many of the same issues he sees in the delivered-fuels industry are things that plagued auto dealers less than 10 years ago, and the auto dealers have turned that around. “There are absolutely ways to help fuel companies catch up on the digital front,” he said. “If anything, the pandemic has made this even more of a priority, as a larger share of the older population has also grown more comfortable engaging online for business services.”

“I look forward to helping connect the dots for fuel companies, and opening up some exciting doors for them to grow and defend their businesses. Warm Thoughts is excellent at all of the approaches I’ve seen as best practices, and our domain expertise in the propane and oil space is unmatched.”

Cathy Pedrayes

Cathy develops our company’s marketing plan, content calendar and promotions to share with our clients and prospects. Cathy has a diverse background including a degree in Environmental Science, where she worked with oil companies and inspected underground as well as aboveground storage tanks throughout the tri-state area. You can always find Cathy working on our next blog, article, webinar or eBlast to educate and share knowledge with our industry.