The oil and gas industry in Australia has witnessed steady growth during the last decade. In the year 2018, the industry was worth $31.4 billion AUD. At the same time, there have been intense campaigns to switch to renewable energy sources such as solar power and mind mills. This has been necessitated by the detrimental effects that fossil fuels cause to the environment. Players in the oil and gas industry, thus, face the threat of losing customers to organizations involved in the production of clean energy. In addition, the oil and gas industry has witnessed the entry of new firms, further intensifying competition. Against this backdrop, it is incumbent upon an oil and gas firm to ensure that its customers remain loyal to it.
One of the most effective ways of attaining customer loyalty is by investing in a strong brand. Hichri & Ltifi (2021) define a brand as a symbol, name, design, terminology, or any feature that an organization uses to identify its goods and services as unique as compared to those of its competitors. A brand can only be considered valuable if customers value it. To measure brand equity, one needs to understand the customers’ knowledge regarding the brand (Hichri & Ltifi, 2021). This will take into consideration the position that the particular brand occupies in the mind of the customer, brand awareness, brand association as well as brand loyalty.
Australia’s oil and gas industry is primarily dominated by public sector entities. Fuel consumers have always exhibited an indifference when it comes to making choices regarding the oil and gas companies to refuel their cars. It is not easy to sustain product differentiation in the oil and gas industry. Although Australian oil marketing companies have introduced various octane fuels and event supplemented their fuels with some additives, there is still a lack of switching costs. Consumers do not find any valid reasons to stay with a particular oil and gas brand (Yadav & Rahman, 2018). Instead, most Australian consumers can only patronize an oil outlet that is easily accessible to them. However, the consumer’s satisfaction level is quite often determined by the treatment he gets from the staff at the filling station. Thus, the dealer service’s reputation plays a vital role in building consumer staff.
Oil and gas loyal customers fall into four categories: convenience, committee, captive, and convenience seekers. According to Sharifkhani et al., (2016), in each of these categories, customers differ when it comes to mindset and actions. In addition, these customers react differently to switching and prompt. Captive customers tend to show a sense of satisfaction as far as the product is concerned. Meanwhile, the loyalty of convenience seekers is often influenced by lifestyle. Meanwhile, loyal customers under the contented category always hope for the product. Finally, the committed customers always remain optimistic in attitude and behavior. Sharifkhani et al. ( 2016) observed that although loyal customers are not necessarily satisfied customers, satisfied customers are always loyal. They went on to highlight two strategies that can be used to manage the loyalty of customers: offensive strategy, defensive strategy. An offensive strategy is mainly concerned with attracting new customers whereas defensive strategy is focused on retaining old customers.
Loyalty has been described as a behavioral response that is prejudiced. However, according to Thompson et al. (2019), loyalty is a commitment that is deeply held to consistently re-patronize or rebuy a preferred product or service in the future from the same brand despite the marketing efforts and situational influences of competing brands. Every organization will always base its strategic goals on the loyalty of its customers (Myo et al., 2019). BOC Limited is aware that obtaining new customers is not a guarantee to keep them for its long-term success. This is why Thompson et al. (2019) assert that new customer acquisition should be balanced with strategies for customer retention.
Cost savings and referrals are the primary benefits of customer loyalty. Regular customers are often loyal to a particular brand since they understand the experience that they have with it. They, therefore, help save an organization advertisement and marketing-related expenses. According to Ismail & Yunan (2016), it is not unusual for loyal customers to refer their friends and relatives to their preferred brands. People often feel smart and exalted in learning new things and they enjoy giving their opinions. To stakeholders, Yadav & Rahman (2018) state that customer loyalty generates unaided awareness, channel migration, and creates a platform for feedback instead of defection. Myo et al., (2019) observe that loyal customers demonstrate an extreme liking for a particular brand. Therefore, an increase in customer share leads to a retention improvement in addition to the referrals that loyal customers bring to a brand.
Loyal customers apply alternative ways in purchasing products. In the oil and gas industry, there are different methods of payment, most of which are cashless. In the views of Agu et al. (2017), loyal customers are often quick to migrate to such payment procedures without creating any hurdles. As a result, such customers enhance their usage and, in turn, help an organization reduce costs related to advertisements of the same. Moreover, loyal customers are often willing to be stakeholders in any of their preferred oil or gas retail brands. As they get used to a particular brand like BOC Limited, for instance, they develop a complaining habit in their efforts to communicate the bad experiences they receive from the oil and gas firm.
Loyal customers get very much concerned and sometimes even personal about their issues up to the point of demanding to be addressed by the manager. All these they do because of their loyalty and belief in the brand. Hence, they feel a sense of ownership of the brand, thus, their willingness to complain instead of keeping quiet (Ismail & Yunan, 2016). These complaints from loyal customers are good for the business as they help identify various management and operational loopholes to be sealed. Yadav & Rahman (2018) state that customer loyalty is related to brand equity. Positive beliefs and strong attitudes towards a particular brand often lead to the brand’s attitudinal loyalty. On the other hand, habitually revealed behavior, weak commitment and satisfactory experience to the brand give rise to behavioral loyalty (Thompson et al., 2019). Meanwhile, usage occasions, variety seeking, and purchasing situation as well as a customer’s circumstances and characteristics are the key determinants of purchasing a particular brand.
The research study will be divided into two: quantitative and qualitative. The quantitative approach will gather and analyze numerical data about customer loyalty in Australia’s oil and gas manufacturing industry. The qualitative research entails researching for new theories and writings on the relationship between customer loyalty and the success of different players in the industry, with BOC Limited acting as a case study. This research method intends to demonstrate that there exists a relationship between theory and research and to test the efficacy of the theory.
To obtain the most appropriate and valuable data that can be used to answer the research question, a qualitative approach will be used in this research methodology. Specifically, pre-designed questionnaires will be issued to the Sales and Marketing Department of BOC Limited. A qualitative approach will be particularly selected because of its ability to provide customer loyalty variables that affect Australia’s oil and gas industry.
The research team will narrow their study to the BOC oil and gas filling stations along the Prices Highway in Australia. This highway will be chosen because it contains filling stations from almost all the major players in Australia’s oil and gas industry. Some of the oil and gas firms present along the Princes highway include BHP Billiton Limited, Woodside Petroleum Limited, Origin Energy Limited, Santos Limited, Caltex Australia Limited, and BOC limited. A total of 15 filling stations will be sampled for this study. Once these would have been identified, specific staff members, particularly those involved in sales and marketing will be selected and issued with the questionnaires. Both closed and open-ended questions will be asked to them through the aid of a semi-structured interview schedule to get the true image of the situation. Through open-ended questions, the opinions of the filling stations, their knowledge, concerns, experiences, and interests will be obtained. Meanwhile, the closed-ended questions will be aimed at providing accurate and direct answers immediately.
Although researchers will physically visit the locations to carry out the interviews, the top sales executives will be interviewed through telephones. This will help save time and resources used for traveling to physical filling stations. However, because of the disadvantages that are associated with telephone interviews, only five executives will be interviewed using this mode. The interviewees will later receive appreciation emails for sacrificing their time to aid in the research. This will also assure them that their data will be safe with the research team and that it would never be used elsewhere without their authorization. Based on the customer loyalty findings among the BOC Limited workers, empirical data will be collected and a report formulated. The data will then be subjected to validity and reliability tests, interpolated, and then analyzed further for decision making.
Reference List
Agu, A. G., Benson-Eluwa, V. & Chioma, P., (2017) ‘Employee complaint management systems in the Nigerian Oil and Gas Industry: A comparison with the Commonwealth Ombudsman Standard.’ International Journal of Business and Finance Management Research, Volume 5, pp. 33-41.
Hichri, A. & Ltifi, M., (2021) ‘Corporate social responsibility and financial performance: Bidirectional relationship and mediating effect of customer loyalty: investigation in Sweden.’Corporate Governance, 21(7), pp. 1495-1518.
Ismail, A. & Yunan, Y. M., (2016) ‘Service quality as a predictor of customer satisfaction and customer loyalty.’ Log Forum, 12(4), pp. 269–283. 10.17270/J.LOG.2016.4.7
Myo, Y. N., Khalifa, G. S. & Aye, T. T., (2019) ‘The impact of service quality on customer loyalty of myanmar hospitality industry: The mediating role of customer satisfaction.’ International Journal Of Management And Human Science, 3(3), pp. 1-11.
Sharifkhani, M., Pool, J. K. & Asian, S., (2016) ‘The impact of leader-member exchange on knowledge sharing and performance: An empirical investigation in the oil and gas industry.’Journal of Science and Technology Policy Management, 7(3), pp. 289-305.
Thompson, P., Okorie, C. & Sakty, K. E., (2019) ‘An Exploratory Study of the Strategic Use of 3PLs for Cost Reduction and Customer Satisfaction in the Oil and Gas Industry: Nigerian Firms’ Experience.’ Journal of Supply Chain Management: Research and Practice, 13(1).
Yadav, M. & Rahman, Z., (2018) ‘The influence of social media marketing activities on customer loyalty: A study of e-commerce industry.’Benchmarking: An International Journal, 25(9), pp. 3882-3905.