Money for Nothing

  John Eichberger |  April 1, 2018

In the 1980s, a start-up television channel that focused on playing music videos launched a grassroots campaign encouraging viewers to contact their cable television providers and say, "I want my MTV." I wonder if we should consider adapting this type of campaign when seeking to transition to a new fuel/vehicle system, such as high-octane fuels.

Note a couple of things about this reference that proves the MTV campaign was 30-plus years ago - 1) MTV played music videos and 2) the campaign targeted local cable providers. The effort was successful and soon teenagers across the country were rushing home to see the latest and hottest video (that is until "The Real World" destroyed MTV forever and ushered in the disastrous and never-ending era of reality TV). But there are lessons we might learn from the experience.

At that time, this year's Rock and Roll Hall of Fame inductee Dire Straits capitalized on the campaign with their hit song, "Money for Nothing," which featured an award-winning animated video that brought into our living rooms what today would be considered a viral melody, "I want my, I want my MTV." (Another reference to the age of this example is the workers in the video had to "install" microwave ovens and move color TVs.)

Why do I bring this up now? Because the recent amplified attention being paid to the role of fuel octane in an internal combustion engine (ICE) got me thinking – are consumers ready for a new fuel rating standard? Advocates want to start selling fuel based upon its research octane number (RON) and replace today’s standard AKI (anti-knock index). This would put the U.S. on a more consistent platform with other parts of the world, but do American drivers care? And do they even understand what octane is?

The Fuels Institute did a survey of consumers in May 2016 and we found that they really don’t know squat about octane, with more than one-third affirmatively saying “I don’t know.”

More alarming for me is that often during presentations I have asked rooms of more than 200 fuel marketers (we should assume they are more fuel-savvy than the typical American) for a show of hands of those who can explain the role of octane in an ICE and I usually get fewer than 10 hands going up. Quite frankly, octane is a mystery for the vast majority of consumers and they often are more skeptical about what they don’t understand, especially if it costs them more money.

I have quipped that the consumer knows that generally at the dispenser from left to right the posted octane rating goes up and left to right so does the price. Last month in this column I asked how are we going to break through the noise, get the consumers attention and teach them anything new – this month I ask again.

At a congressional hearing in early April, a panel of industry representatives spanning the refining, automotive, biofuels and retail sectors testified that increasing the base octane level of gasoline to a level equivalent to today’s premium fuel would be feasible and possibly beneficial to the market. The auto industry argues that the expected increase in retail fuel prices for all consumers would be offset by an improvement in fuel efficiency. I don’t doubt that higher octane fuel could boost fuel efficiency (especially in newly designed engines), but how will we convince the consumer who might have to pay more for a gallon of gasoline? This increased price at the pump will be immediately recognizable – will an offsetting improvement in fuel efficiency?

I have been part of the octane discussion for years, attended and spoken at many conferences dedicated to the topic and I have read too many technical reports about the benefits of higher octane to the performance of an internal combustion engine designed to take advantage of the fuel. I also serve on the external advisory board of DOE’s Co-Optima project, which has focused on how to optimize fuel formulation and engine design to achieve maximum benefit. I am not an engineer (far from it – I was a history major), but I get it. I think higher octane fuels can make a lot of sense. But will the consumer think so? Remember, more than 60% of consumers say they would drive five minutes out of their way to save 5 cents per gallon – which ultimately is a losing proposition. They do not react kindly to an increase in retail fuel prices.

In fact, I would argue there is nothing in commerce that elicits as much immediate angst among consumers as does an increase in retail fuel prices. For 15 years, I was one of the primary spokespeople representing fuel retailers before the government and media and I was never more busy nor under more attack than when prices went up. Some consumers automatically think they are being taken advantage of and more than a few believe the higher octane fuels are just a way for the retailer and oil companies to make more money. Today, with premium often commanding a price that is 60 cents more than regular, the challenge of breaking such perceptions I would argue has become much more daunting.

I can hear some of my friends moaning – “Here he goes again, always so negative!” Not at all. I am not saying it cannot be done, (or shouldn’t be done – I believe the jury is still out on that one) but we have to be realistic about the challenges that might be encountered. I have been called a lot of things because I am constantly pointing out the hurdles to success, but I believe if you know where the hurdles are you are less likely to trip over them.

For those contemplating this effort, I ask: if there is not a comprehensive, message-tested, cross-industry strategic campaign that includes some sort of government endorsement (i.e., approved public service announcements), what is the chance of successfully converting consumers?

When I was with NACS, it took us years of consistent messaging through hundreds of NACS-trained spokespeople, repeated appearances on television news channels, thousands of interviews with reporters, multiple exonerating investigations by the Federal Trade Commission and congressional committees and the defeat of several federal bills to criminalize “gouging” to break through the long-held assumption that retailers were price gouging when retail prices went up. We were successful in explaining the factors that contribute to retail price volatility and shifting focus on the causal factors, but it took more than 10 years.

If we are going to transition to a higher octane fuel market, and we want to start selling fuel based upon its RON, we have to be prepared to explain this to consumers and get them to support it. It might be time to dust off relatively ancient campaign strategies, capitalize on the recent exposure of Dire Straits and start the “I want my RON” campaign. Imagine a new music video featuring animated cars thirsty for higher performance dancing across a gas station singing along with happy consumers. If educating consumers is too great a lift, can we possibly create a new viral hook that will dispel distrust and compel consumers to embrace the new fuel because it is cool?

Whatever new transportation solutions are being pursued, advocates must consider the communications strategy early in the process, test the messages and develop a comprehensive, integrated campaign that will help clear the hurdles that stand between the starting line and a successful implementation. Because remember, if the consumer cannot access it or does not want to buy it, we have wasted years and billions of dollars.

“That ain’t working, that’s the way you do it
Get your money for nothin’ get your chicks for free.
(I want my, I want my MTV)”