While the sales of electric vehicles are at an all-time high, combustion engine car sales are experiencing a decline. That is traditionally seen as a threat for gas stations and petrol retailers. But electric vehicles can offer great opportunities to petrol retailers if they take the chance to act now and transform their business models. Which new revenue streams can petrol retailers explore with EV charging?
Guests:Ilkka Koisti, Sales Director, Customer Solutions at Virta
Host: Jason Millward
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Intro
Jason M.
Hello there and welcome. My name is Jason Millward and you are listening to Plugged into Virta - the electric vehicle charging podcast. The future of mobility is electric. In this podcast we will discuss about the newest and hottest topics in the world of e-mobility, smart EV charging, energy management and the business around it. We will go under the surface and discuss openly about the challenges, opportunities, solutions and trends.
We will give you honest fact-based information and tell you what it means in practise in plain English. So, if you want to hear insights from top experts, learn more about the world of EV charging and the future outlook, or just want to listen to some inspiring stories from around the world of EV charging. This podcast is for you.
Interview
Jason M.
Today's episode is about petrol and why EV charging is a golden opportunity for petrol retailers. My guest today is Ilka Koisti, and before we dive into today's subject and talk about the petrol sector and how electric mobility providers can help to solve them, could you just introduce yourself and tell us a bit more about yourself?
Ilkka K.
Thank you, Jason. My name is Ilka Koisti and I am for Virta and my focus is on the business development, and specifically for petrol retailers. My background is basically in the software development business for customers who want to earn more revenues, in profitable way and get more loyalty customers.
Jason M.
Thank you for joining us. So, let's set the scene first. What's happening in the fuel retail industry and what are the biggest challenges, what are the biggest pain points?
Ilkka K.
So far, what I have learned with the discussion with petrol retailers, the amount of diesel and petrol per day or month is declining, or at least it's not growing anymore as fast as it used to go. Now they need to find some other important revenue sources. Of course, grocery shopping, food to go is very critical for them as that is giving them additional revenue. But also, how to get the people on those forecourts? And that is something why petrol retailers are looking for EV charging, because that is the kind of honey pot to get the people to the petrol forecourt and then of course offer the extra services on top of the EV charging.
Jason M.
And how about in the e-mobility sector? What's the future outlook there?
Ilkka K.
Well, as we know, every day from the newspapers, there's a lot of articles how the amount of EVs in every continent is growing, and of course specifically in Europe, it seems to be very much the topic that is also discussed within politicians, they want to get there. Let's say detail station for transmission and transportation and of course EVs are one part of that game.
Jason M.
Is the electrification of mobility a threat or an opportunity for the petrol sector?
Ilkka K.
Definitely, I see that's a great opportunity. As if we think a little bit out of the box. Traditionally, EV drivers are coming to the petrol forecourt and of course charging their vehicles, EVs, and then also buying some coffee and food to go. But if you think a little bit out from there, customers are also charging their vehicles at home, and also at the office or some other locations.
So, we're talking about the golden triangle approach. Basically, the EV and petrol should also meet at your business, at the office location. So, imagine that petrol brand would also offer the charging at your office location with their brand, with their invoicing - billing services as a monthly bill. That will be an opportunity that petrol retailers should take as well, even to go home. So, with your brand, petrol retailer’s brand, you show charging service at customers’ home. You would charge your car at home, at the office and then when you travel, you go also the better forward with the one single subscription, one single invoice and loyalty. That is a killer.
Jason M.
So, nice and simple.
Ilkka K.
It's nice and simple. And your brand is always aware whether you are at home, at the office, as well as at the petrol forecourt. Your brand picture is getting much stronger.
Jason M.
How do you tackle the electrification of mobility as a petrol retailer? Explain a bit more about that.
Ilkka K.
Basically, it's what I said a little bit earlier, but as well, if the petrol retailer is not making the move to catch and keep the customer base, someone will take that away. And of course, the competition is fierce. I would say that the money is on the table, and it will be redistributed. Someone will attract those customers who are now coming to the petrol station and filling up petrol.
Someone is offering that service for the electricity, but not for the petrol forecourt. And if the petrol retailers don't move, someone will take those customers away and that's why it is obvious that it's happening, and actions need to be taken now.
Jason M.
You said that petrol stations and EVs can be a great match, so why and how?
Ilkka K.
As I said, it's a great opportunity, because you can also go out from the petrol forecourt to the office locations and home. If you don't go there, there will be someone else offering the services at home and office locations and then basically the customer base for what the petrol forecourt is offering is actually declining. An amount of kilowatt hours and amount of grocery stores and food to go is also declining. So yes, it has to be done today.
Jason M.
So how will distributed energy production, energy storages affect the petrol retailer business case. Can you explain a bit more about that?
Ilkka K.
Excellent question Jason. If you think about traditional petrol retailer business, they drill the oil, they refine the oil, they distribute it and sell it.
Now, with electric vehicle charging, actually they're not producing the energy necessary anymore by themselves, so there will be someone else producing the energy, the electricity and then the petrol retailers are reselling that. So there's someone else also in the value chain.
The option, the opportunity brought into this is that if petrol retailers will go really out of their comfort zone at the moment, they would offer as well local energy production with the photo voltage or even windmills. Then they can have a local energy storage as well either in the petrol forecourt or in those home offices or office locations. With that they can actually have a great opportunity to offer the whole value chain package. Not anymore only reselling and selling. It's basically that they also produce energy which is distributed locally and that gives a lot more revenue streams, and also the customer loyalty and stickiness. What they really need is that the customers are not running away. And of course, it gives them much cleaner image. If you think that they are producing energy locally from photo voltage or windmills and then distribute that to the energy for the electric vehicles. So that will be a great opportunity with their brand to get much better image.
Jason M.
And how do you see the future going? I mean, what will the petrol sector business look like in 2025 or 2030?
Ilkka K.
Well, when I look in my crystal ball, it looks like I have a better brand, which I’m loyal to. I can charge my car when I'm travelling let's say to Lapland or further away in Europe with one single cart or mobile application or even plug-and-charge, so I don't need to show the mobile app or RFID tag to start the charging. As well, that works at my home, and also at my office location or wherever I go with the same single subscription.
Jason M.
Awesome, sounds like a great future. Well, thank you very much for joining us and pleasure to have you here.
Ilkka K.
Thank you, Jason.
Outro
Jason M.
And that’s it for this episode of Plugged into Virta: The electric vehicle charging podcast.Thank you for listening!
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Until next time, thank you for joining us. Let’s take charge of the future – together.
