US gas stations: Stay BP or change name to Amoco?

[July 30, 2010]  NEW ORLEANS (AP) -- BP gas station owners across the country are divided over whether the oil giant stained by its handling of the Gulf spill should rebrand U.S. outlets as Amoco or another name as part of its effort to repair the company's badly damaged reputation.

Some who have seen their sales plunge because of protests say BP has already sought a fresh start by naming an American to replace its gaffe-prone British CEO, so why not change the name on gas stations marquees as a further symbol of that culture shift.

Others worry that a name change is a big deal that is risky given all the marketing dollars already spent building up the BP brand. They also believe a successful turnaround with the existing brand will have a bigger payoff.

In the aftermath of the oil spill, some BP-branded gas stations reported sales declines of 10 percent to 40 percent from Florida to Illinois. BP later responded by offering distributors of BP gasoline cash in their pockets, reductions in credit card fees and help with more national advertising.

The BP name and green-and-yellow sunflower logo took over after BP merged with Amoco in the late 1990s, replacing the Amoco name and its blue-and-red torch inside an oval logo.

There is precedent for such a drastic move to return to the Amoco name or to go with a new name. Think AirTran after the ValuJet crash and Xe Services after the killing of civilians by Blackwater Worldwide guards in Iraq.

John Kleine, who heads a trade group that represents distributors of BP gasoline in the U.S., told The Associated Press that interest in changing names has not reached a fever pitch by any means, but it has supporters and is percolating among station owners ahead of their annual convention with BP executives in October.

"Is it on the minds of people? Sure," Kleine said. "It would not be a topic of conversation if not for the oil spill."

Kleine noted that many distributors would still like BP to try to rebuild its existing brand, and if that cannot be done, then to consider alternatives.

Distributors in many cases also own and operate stations.

Two BP officials said in e-mails that the company is not considering rebranding U.S. gas stations.

BP owns just a fraction of the more than 11,000 stations across the U.S. that sell its fuel mostly under the BP banner. ARCO, a BP affiliate, is predominant in the West. Kleine said the Amoco name is no longer supposed to be used, but acknowledged in rare cases it may still exist in a few locations. Most BP-branded stations are owned by local people whose primary connection to the oil company is the logo and a contract to buy gasoline.

Bob Juckniess, who owns 10 BP-branded stations in the Chicago area, is in the camp that wants BP to consider rebranding to Amoco at U.S. outlets.

"The BP brand is very tarnished right now, not just the brand but the reputation as a company is tarnished," said Juckniess. He added, "Amoco was very well known and had a great reputation as a name and a brand."

Juckniess said he feels so strongly about the issue that he would "urge BP to look at the ramifications of such a change."

It is noteworthy that Bob Dudley, the American who will replace Tony Hayward as CEO on Oct. 1, worked for 20 years at Amoco Corp.

On the other side of the debate is Jeff Miller, whose company owns, operates and supplies roughly 56 BP-branded stations primarily in southeastern Virginia.

He said that if BP does the job right and invests back in its brand and customer base, it stands to gain more by not changing the name at U.S. stations.

"When you look at all the case histories of all that have done it well, whether it is Toyota, Tylenol or Exxon, they have all reinvested in their brand and done a better job," Miller said. "If you just change the name and don't change the behavior, have you really gained anything?"

Miller said he has heard from a number of station owners who have suggested BP rebrand U.S. stations as Amoco, but he describes that as a "knee-jerk reaction." "I think you get a better return by working on repairing your reputation than starting fresh," he said.

Jim Donnini, whose company owns, operates and supplies roughly 75 gas stations in Florida that fly under brands including Chevron, Exxon, Shell, Sunoco and Valero, said Amoco was a very strong brand in Florida.

"Everybody thought they missed their opportunity to keep it that way," Donnini said of BP, referring to the aftermath of the Amoco merger.

Donnini, who doesn't own any BP stations, said he has heard from owners of BP-branded stations in Florida who would like BP to consider a name change at U.S. stations.

"It's really a shame the independent businessmen that fly that BP flag are being victimized," Donnini said.

[Associated Press; By HARRY R. WEBER]

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