7Ps Of Marketing Mix

Contents
1. 2. 3. 4. 5. 1. I.

Pakistan State Oil 2012

Introduction .......................................................................................................................................... 3 Continuous growth ............................................................................................................................... 3 Mission statement ................................................................................................................................ 4 Strategy to achieve mission .................................................................................................................. 4 Marketing Mix of PSO: .......................................................................................................................... 4 Products: ............................................................................................................................................... 4 Single Grade petrol: .......................................................................................................................... 5

2. Castrol GT: ............................................................................................................................................. 5 Benefits ................................................................................................................................................. 5 3. High Speed Diesel.................................................................................................................................. 6 2. Price: ..................................................................................................................................................... 6 Pricing Strategy of Petrol & Diesel ............................................................................................................ 6 Pricing strategy of Castrol GTX.................................................................................................................. 6 i Profit.................................................................................................................................................... 7 ii Services............................................................................................................................................... 7 3. Place: ..................................................................................................................................................... 7 Placement, distribution, channel, or intermediary................................................................................... 7 For product movement network: ............................................................................................................. 7 PSO has storage depots all over Pakistan: ................................................................................................ 8 South Zone Depots:............................................................................................................................... 8 NORTH ZONE DEPOTS ........................................................................................................................... 8 CENTRAL ZONE DEPOTS ........................................................................................................................ 8 4. PROMOTION: ........................................................................................................................................ 8 Mega hoardings ........................................................................................................................................ 8 Zoom Signs ................................................................................................................................................ 8 Encouraging sports.................................................................................................................................... 9 PSO Light & Visual Park ............................................................................................................................. 9 Directional and safety signs ...................................................................................................................... 9 PSO Cards .................................................................................................................................................. 9

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

5.

Pakistan State Oil 2012

People: .................................................................................................................................................. 9 Board of Management ............................................................................................................................ 10

6. 7.

Process: ............................................................................................................................................... 10 Physical evidence: ............................................................................................................................... 10

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Pakistan State Oil 2012

1. Introduction
Pakistan State Oil Company Limited, namely PSO was found in 1976, as a result of amalgamation of the formal three oil marketing companies i-e Pakistan National Oils Limited, Premier Oil Company and Esso Undertakings in Pakistan. There is a chronology of events leading to the formation of Pakistan State Oil Co. Ltd .On January 1st, 1974, Federal Government takes over management of PNO (Pakistan National Oil) and DPO (Dawood Petroleum Limited) and renamed it into POCL (Premier Oil Company Limited) under marketing of Petroleum Products (FederalControl) Act, 1974.Then on June 3rd, 1974 Government incorporated Petroleum Storage Development Corporation, PSDC. On August 23rd, 1976 name of PSDC was changed to State Oil Company Limited, SOCL. On September 15.1976 Government purchased ESSO Undertakings, vested the same in SOCL. And finally on December 30, 1976 Government merged PNO and POCL into SOCL and named it as PSO. As the largest oil marketing company of Pakistan, PSO is engaged in the storage, import, distribution and marketing of Petroleum products, petrochemicals, Aviation and Bunker fuels, LPG and CNG dominates the countrys fuel and energy needs. Since its inception in 1976 the company has been meeting more than 70% of the countrys fuel needs. PSOs 3805 outlets all across the country markets more than 12 million tons of fuel products annually. This network is supported by PSOs 28 storage facilities with a capacity of more than 800,000 tons .PSO took a major step in improving its distribution facilities by acquiring 12% equity in the 800km long KarachiMehmood kot White Oil Pipeline. As part of PSOs policy of providing better customer services, it has embarked upon its New Vision retail development program. Equipped with the most modern facilities like Electronic dispensing units, auto car wash, convenience stores, internet facilities and business centers, these sate of the art designed stations provide greater customer confidence and a friendlier environment. As a manifestation of PSOs greater customer focus PSO 24hr customer service has been launched where customers can lodge their queries and suggestions about various PSO products and services. Being the largest of the three marketing companies in Pakistan, PSO has consistently maintained an edge over its competitors Shell and Caltex. With an overall market participation of over 72% in 1997-98, it sold 6.244 million tones of petroleum products during the half year ended December 31st, 1999 against 5.633 million tones sold during the corresponding period last year, showing an increase of 10.8%.

2. Continuous growth
PSO continues to expand its physical, technical and marketing resources to meet the requirements of the country .To keep pace with growth, PSO has maintained International Collaborations to import latest technology. These are: 1. Castrol (UK) Blending and marketing of lubricants in Pakistan

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Pakistan State Oil 2012

2. Air Total (France) Technical and Commercial agreements in Aviation Services 3. Exxon Chemicals (Singapore) Petrochemical Business And Technology.

3. Mission statement
To ensure availability and security of sustainable supply of oil and gas for economic development and strategic requirements of Pakistan and to coordinate development of natural resources of energy and minerals.

4. Strategy to achieve mission

To adopt an integrated approach for promoting exploration and fast track development of oil, gas and mineral resources. To deregulate and liberalize and privatize oil, gas and mineral sector through structured reforms. To attract private investment and to establish credible institutions for facilitating the development of petroleum and mineral sector. To develop technical professional human resources. To optimize existing energy delivery infrastructure oil and gas pipelines. To reduce imported fuel oil consumption with indigenous gas by optimally balancing the gas availability and supplies from local and imported resources.

5. Marketing Mix of PSO:

The 'marketing mix' is probably the most famous phrase in marketing. The elements are the marketing 'tactics', also known as the 'four Ps'. The marketing mix elements are product, price, placement and promotion. Some commentators will increase the mix to the 'five Ps', to include people. Others will increase the mix to 'Seven Ps', to include physical evidence (such as uniforms, facilities, or livery) and process (i.e. the whole customer experience e.g. a visit the Disney World). Neil H. Borden coined the term in his article 'The Concept of the Marketing Mix' in 1965. The concept is simple. Think about another common mix - a cake mix. All cakes contain eggs, milk, flour, and sugar. However, you can alter the final cake by altering the amounts of mix elements contained in it. So for a sweet cake add more sugar! It is the same with the marketing mix. Varying the mix elements can alter the offer you make to your customer. So for a high profile brand increase the focus on promotion and desensitize the weight given to price.

1. Products:
Single Grade Petrol (Premier Plus) High Speed Diesel (HSD) Castrol GTX

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

I. Single Grade petrol:

Pakistan State Oil 2012

Compatible with mineral and synthetic oils and most hydraulic oils. Blends with most greases, pastes, 2-stroke fuel oil, cutting oil, chain oil, compressor oil, axle oil, drilling lubrication, tapping fluids, hydraulic oil, mining fluids, petrol, diesel, marine fuel oil, scour able oils, coolants, anti freeze, soluble cutting fluids, penetrating oils, flushing oils, general purpose lube oils. Single Grade Petrol products benefits.. Saves petrol/diesel fuel up to 20% Improves engine power (BHP) 8% Reduces exhaust emissions 46% Reduces all round friction 90% Reduces oil consumption 20% Improves compression 16% Saves electrical power 14% Improves Nm rating on gears 12% Improves cutting life 200%

So they say that SGP, which is commonly known as petrol, is their fast moving product. They also claimed that it is profitable product as its consumption is very high.

2. Castrol GT:
Multi grade super high performance oil for use viscosity range of SAE 20W-50, gives the rapid circulation and adds protection during start up from cold, where 80% engine wear may occur, with extra protection for engines operating in hot and dusty climates. Benefits Longer engine life and power retention.

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Pakistan State Oil 2012

Improves oil pressure and consumption. Protects against soot, varnish, black sludge formation, acid and corrosion Because of all these description it is also considered as one of the fast moving product. Independent power plants, Wapda and etc mostly demand it. It is used as lubricant in the petrol consumption cars.

3. High Speed Diesel

High speed diesel is one of the fastest moving product among other products of PSO. It is most commonly used by heavy engine vehicles and automobiles. It is used in these areas: Agriculture Industry General Public It is used in large, slow speed marine engines and automotive engines as well.

2. Price: Pricing Strategy of Petrol & Diesel

Both petrol and diesel are placed under the head of fuel oil, so that the pricing strategy of both of these products is same. And well discuss it in the context of pricing strategy of full oil.Fuel oil prices are set by a committee for all oil marketing companies. And to this fact all oil-marketing companies are having same. Petrol and diesel prices. There is almost no difference between the fuel oil prices of PSO and Shell, or any other competitor. Fuel oil pricing strategy its standard. Set by OCAC (Oil Companies advisory committee). Up to every fortnight the fuel oil prices are revised.

Pricing strategy of Castrol GTX

There is no hard and fast rule for the pricing strategy of castor GTX. But still there is a defined strategy of prices. In case of Castrol GTX, that is a lubricant, all oil companies set their own prices which means prices of lubes vary from PSO, Shell and Caltex. These prices are based upon. Cost Handling charges Storage charges Because some companies have to bear less cost handling charges as well as storage charges thats why; this product of PSO has greater demand in the market. Being a government company

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Pakistan State Oil 2012

PSO has to bear less cost and handling and storage charges. Lubricant prices are revised after ever 4-6 months. They have defined their pricing strategy as competitive prices. They have said that we have competitive prices. Two factors are considered while setting the prices
i Profit ii Services

In case of lubricants, they set their prices lower than their competitors.Current prices of these products Single grade petrol Rs. 89.82 High speed diesel Rs. 98.82 Castrol GTX Rs. 1500.00 (1 Tin/ 4 litres pack)

3. Place: Placement, distribution, channel, or intermediary

A channel of distribution comprises a set of institutions, which perform all of the activities utilized to move a product and its title from production to consumption. Place is also a channel of distribution or intermediary. It is the mechanism through which goods and/or services are moved from the manufacturer/ service provider to the user or consumer. There are many types of intermediaries such as wholesalers, agents, retailers, the Internet, overseas distributors, direct marketing (from manufacturer to user without an intermediary), and many others. For Single Grade Petrol (SGP) and High Speed Diesel (HSD), the most viable placement channel is the products movement from wholesalers to retailers .For general retail outlets; this facility is available in the form of tank lorries. For industrial needs, railway tank wagons are the most appropriate source. Previously Government of Pakistan had been paying the freight charges of their placement but now for the product movement, retailers have to pay themselves the freight charges. As far as the placement of Castrol GTX is concerned, different lube vans are available which take the lubes from manufacturers to dealers of petrol pumps to be available on lube shops. Also there are different agencies for lubricants, which take them from dealers on their own expenses and sell to general public. These days the enhancement of existing facilities and development of new infrastructure especially pipelines, which are the safest, efficient & most environment friendly mode of transportation, is being looked up carefully. Pakistan Railway is also gearing for moving more product upcountry. This is very important to reduce the pressure on road movement

For product movement network:

PSO all over the Pakistan has: Tank Lorries 13400

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Railway Tank wagons 1120 Pipelines 13

Pakistan State Oil 2012

PSO has storage depots all over Pakistan:

These include, South Zone Depots: Hyderabad, Daulatpur, Sukkhur, Sanghi, Quetta C, Khuzdar and Pasni. NORTH ZONE DEPOTS Chakpiran, Faqirabad, Taru Jabba, Serai Naurang, Kundian, Juglot, Chitral and Kohat. CENTRAL ZONE DEPOTS Vehari, Shershah -2 (B&C), Lalpir, Sahiwal, Habibabad, Faisalabad A, Faisalabad 'B',Badami Bagh, Kala Shah Kaku, Gujranwala, Sargodha and Kotla Jam.

4. PROMOTION:
This includes presenting interesting fuel and lubricants promotion campaigns to indulge customers.

Mega hoardings
Mega hoardings constructed at retail outlets are another classic example, which is not only an extremely cost-effective initiative but also provides the company with an ideal location to advertise and also enhances the outlook of the outlet.

Zoom Signs
Another image-building tool and a one-of-its-kind mode of advertising is Zoom Sign. These are 110 feet tall towers, with PSO logo on the top, built at the stations in major cities of Pakistan. These signs that can be seem from a distance are providing PSO with tremendous mileage.

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Encouraging sports

Pakistan State Oil 2012

PSO is also keen on encouraging sports in the country and is a major sponsor of SAF Games, various cricket series, golf tournaments and squash championships.

PSO Light & Visual Park

PSO has also adopted a park now called PSO Light & Visual Park in Islamabad where new plantation and lights have been put up along with other beautification activities.

Directional and safety signs

Activities like putting up of directional and safety signs and overhead gantries in Karachi, Lahore, Islamabad, Saiwal, Peshawar and Faisalabad is the classic example of PSO as a socially ethical organization.

PSO Cards
PSO is also offering plastic cards for the retail and industrial consumers according to their requirements. 1. Loyalty Card 2. Prepaid Cards (available in Rs. 500, 1500, 2500 & 5000) 3. Fleet Card for Corporate Vehicles 4. Corporate Card for Corporate employees

5. People:
In Marketing Mix one of the most important P is People. The employes of PSO nearly equal to 2000 who are working in all over in the Pakistan they are the assets of the company and they are the responsible for the good will of the company company also focuses on the status of there employees and give them performance appraisal program and give them incentives and also give them medical treatment.

By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Board of Management
Mr. Sohail Wajahat H Siddiqui Chairman Mr. Jehangir Ali Shah Managing Director Mr. Muhammad Azam Member Mr. Malik Naseem Hussain Lawbar Member Mr. Shabbir Ahmed Member Mr. Osman Saifullah Khan Member Mr. Hammayun Jogezai Member Dr. Abid Qaiyum Suleri Member Mr. Wazir A. Khoja Member

Pakistan State Oil 2012

Including hundreds Frontline employees PSO is always Ready to provide its products and services to its customers with ease and convenience.

6. Process:
The upper level of management makes strategies and rules and regulations about how to deliver the Services. The customer who needs PSO services visit to his/her nearby PSO Petrol Pump where the full of effect and dedicated staff provide them services as per policy set by their upper management. As per Senior management directs there are PSO Petrol Pumps situated in to cover an specific area of Region. The Fuel is supplied through tankers from nearest storage depot to the petrol pump according to the demand and supply of consumption and then offered by frontline employees to the customers at the amount fixed by Government. Through

7. Physical evidence:
Physical evidence is the material part of a service. Strictly speaking there are no physical attributes to a service, so a consumer tends to rely on material cues.PSO built very good and attractive buildings of its Outlets in order to attract the customer and as physical evidence.

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By Saad Bin Mehmood MBA B&F

IM Sciences

7Ps Of Marketing Mix

Pakistan State Oil 2012

The Above Figure shows the physical evidence of PSO Exterior

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By Saad Bin Mehmood MBA B&F

IM Sciences