Wal-Mart's tricky gas ploy
Saving 10 cents a gallon sounds great until you consider what you'll give in return.
Just what we need, with months of road trips ahead of us. And it's just what Wal-Mart needs, too, as it tries to reverse its worst U.S. sales slump ever.
Unfortunately, the discount is good only at Murphy USA and Wal-Mart gas stations in 18 states, mostly in the heartland (full list here). California and the Northeast are out of luck.
So if you're in the right state, is this a good deal? As it turns out, what Wal-Mart gets in return more than compensates for any loss it takes from the discount. Let's go over what Wal-Mart receives from this promotion:
1.More in-store traffic. One of Wal-Mart's biggest problems is that it isn't seeing enough people in its stores. So it made sure you can get the gas discount only if you use a Wal-Mart credit card, gift card or MoneyCard.
What's the easiest way to get one of those cards? Go into a store. Wal-Mart hopes that while you're there, you'll remember that you need toilet paper. Oh, and bananas. And socks. Aw, heck, let's just turn this into a full-on shopping trip.
By the way, do all those gas-saving tips (like using cruise control and proper tire inflation) work? The following video demolishes the myths and uncovers what you really need to do to save on gas.
Post continues after video:
2. More customer information. You need to hand over plenty of information about yourself in order to get a Wal-Mart credit card or MoneyCard. The MoneyCard application asks for your address, Social Security number, email address, phone number and date of birth. That opens up plenty of new moneymaking opportunities for the giant retailer.
3. Lots of positive attention. Wal-Mart gets loads of good press from the discount, especially at a time when everyone is concerned about gas prices. Even people who don't live in one of the participating states will get the impression that Wal-Mart is doing something for financially strapped families. And maybe when they next choose whether to shop at Wal-Mart or the dollar store, that will make a difference.
4. More credit card customers. Throughout the recession, Target's (TGT) saving grace has been its credit card business. Shoppers there aren't buying higher-profit items like clothing and furniture, but that's OK. The credit card business saw profit leap nearly 75% to $194 million in the most recent quarter.
Wal-Mart doesn't have that kind of credit business, but it wants it. And if the gas promotion gives its credit card division a boost in the arm, the payback will be well worth it.
5. More fee revenue. Wal-Mart charges a $3 fee for a MoneyCard, a $3 fee to reload it and a $3 monthly maintenance fee (waived if you load $1,000 to the card for the month). The Wal-Mart Discover card and credit card both charge a 22.9% annual percentage rate and late-payment fees of up to $35.
So that's what Wal-Mart gets from this promotion. What do customers get? Let's see, my car can hold 12 gallons of gas, so a 10-cent-a-gallon discount saves me a whopping $1.20 if I fill the tank.
Is that savings worth the hassle?
Does the media have anything better to report on that rehashing how much they hate Walmart. This type of "ploy" is used by all retailers. Ground Beef on sale? You might need hamburger buns and sodas and chips, etc.
Dresses on sale? Also get the right shoes, pantyhose, necklace, etc.
All retailers do this. But nooooo. They only pick on Walmart because it sells stories and advertising. Hey! That's the same principle. Bash Walmart and then readers will notice other stories which will lead to seeing ads and maybe revenue from those ads.
@mike3108 - My previous comment was meant as pure sarcasm. Apparently it wasn't outlandish enough! Of course I didn't get a credit card without giving information, and that's my point. Why single out Wal-Mart for something that every other company on the planet does? I'll work on my sarcasm skills, but I still have to say that this article truly is garbage.
I am not a big fan of Wal-Mart, when I can I support local merchants. But I do shop there on occasion. When I lived in the Midwest, Wal-Mart gas was my best option.
I am not discounting the points made in this article and obviously Wal-Mart, like most company's are most concerned with their own bottom-line. It is possible however, to take advantage of Wal-Mart gas discounts without a Wal-Mart credit card.
All you have to do is load a Wal-Mart gift card at any register, which is a free service, and then the gift card for your gas purchase. If you shop in the store any way, it can be done when you are there and does not involve any additional trips or hassles. This way, if you want or need to pay less for gas, you have the option.
It’s Ravi from Walmart. It’s important to note that we’re doing this to help our customers and feel our offer is better than anything other stores offer because ours doesn’t require another purchase, a loyalty card or have any other purchase restrictions. Customers can even use a Walmart Gift Card – which has no fees – and enjoy these savings. As far as the Walmart Credit Card, we offer a standard application process that follows federal guidelines, and we never sell that information to 3rd parties.
During a time when a lot of customers have told us they’re feeling squeezed by gas prices, we think every penny counts and 10 cents a gallon is an extra savings customers need.
Ethanol is required in some cities - I live in Houston -every station uses ethanol because it is required by law.
BTW - you must not teach math and must be a dope -
No way 10% ethanol can reduce your MPG by 25% - YES ethanol contains less energy per gallon than gasoline - it will lower MPG by a little bit - maybe 2-3%.
But even if they required 10% air be added to your gas it couldn't reduce MPG by more than 10%.
You got a mortgage and a credit card without giving a single piece of information. You are a liar. Just a plain flat out liar
Walmart is having its worst sales slump ever? Boo Hoo. I recently bought something through Walmart.com and had it shipped to the store. They lied about when it would be delivered. When I called customer service, they lied to me. Warranty information that was allegedly sent to me by email and snail mail was never sent to me. I emailed the CEO about the problem and never even got a response from him or one of his staff.
If you want to have better sales, stop lying to customers. Have the balls to address customer concerns directly, without lying to them. .Give customers better service. Until then, you can forget getting any of my business and you can stick your stores where the sun don't shine.
How stupid can some of you people be. If Walmart or any other company gives you a discount, and you are so stupid you don't realize that they plan on making it up in some other area, you shouldn't be allowed out without supervision.
No one forces you to shop at Walmart; no one forces you to buy their gas. FWIW, Murphy is one of the few gas companies that sells only US produced gas.
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