Wal-Mart's tricky gas ploy

Saving 10 cents a gallon sounds great until you consider what you'll give in return.

By Kim Peterson Jun 29, 2011 1:56PM
Image: Filling fuel tank (© Corbis)At a time when gas prices still top $3.50 a gallon in many states, Wal-Mart (WMT) offers what sounds like a great deal: Save 10 cents a gallon all summer long.

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?

57Comments
Jun 29, 2011 2:52PM
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Who would have thought that lower prices were a bad thing?  Can't you find a good reason to pick on Wal-Mart?
Jun 29, 2011 2:53PM
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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.

LOL

Jun 29, 2011 3:56PM
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The gift card doesn't cost anything to load, why would you apply for credit or use a money card.  The gift card is just as safe if you are responsible enough to keep up with a credit card the gift card should be fine.  I agree that Wal-Mart's motives may not be altruistic but there are options.  Have you been to a "dollar store" lately, they are more expensive than Wal-Mart on more items than not.  And Wal-Mart will price match other grocer's advertisements.  Sure they are in it to increase business and profits.  Wouldn't you like an increase in your income?  I certainly would. 
Jun 29, 2011 5:00PM
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@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.

Jun 29, 2011 5:52PM
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I have a 35 gallon tank so we are talking 3.50 a fill for me.  That is a free gallon of gas......yeah, I'll take that anytime.  I pay off my account each month and do it online so they don't get that much out of me except gas business.  I shop there anyway but, only pay with my debit card as I don't like paying interest.
Jun 29, 2011 6:10PM
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I'd buy a gift card and just refill it to save a little. It's not that hard. Nobody's twisting your arm. But personally when it costs me almost $100 to fill up, I'll take all the help I can get!
Jun 29, 2011 6:10PM
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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.

Jun 29, 2011 5:30PM
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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.

Jun 29, 2011 3:49PM
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This bogus article is written by another anti Wal-Mart person. Give it a rest. You can use a gift card from WM (no fee). Does it get you in the store, yes. Big deal, All gas is pumped by someone that wants you to come into their store. Does WM screw its employees, no. If they did they would not have any to work in the stores. Its a big business, get over it, they want to make $ just like everyone else.
Jun 29, 2011 3:35PM
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A lot of the people that Walmart employs would be otherwise on welfare or SSI so I don't see that as screwing their employees.  The conservatives complain like crazy about welfare and SSI benefits to the handicapped, and then they complain about about the small percentage that Walmart can employ and keep off of those programs.  You can not have it both ways, either you want them on welfare or you want them employed, which is it?
Jun 29, 2011 6:27PM
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Not worth it to me.  I will gladly pay a little more to NOT support Walmart because of what they cost the community, the consumer, and all of us in the long run.  Neither do I provide my personal information for a chance to win some trip or hot tub, etc.  Believe it or don't - but Walmart is not doing anything that does not pay off for it big.  That is how they became so wealthy.  And their so-called low prices are a joke - coffee that goes up $2 in one week and more.  Prices inflate all over - but by 2-3%, not the 30% and more Walmart loves to jump.  They lower prices when the pressure of their competitors makes them.  The customer service stinks, error rate higher than anywhere else, and quality of anything "fresh" is questionable at best.  As far as choice goes, I would have more choices had the masses not lined up like blind sheep to buy at Walmart so they could buy that big screen tv made in China and a pack of chips at the same time.  Not to mention, let Walmart do their thinking for them - if Walmart says it is the same brand (implying same quality standards) and cheapest price, well gosh darn it must be then.  Now I do not have to look, compare, and decide for myself from multiple retailers.  Sure makes throwing money away quick and easy.  And don't say everyone else sells China crap, too - who do you think led that trend??  Who made China the biggest mfr of consumer goods - you guessed it.  Their biggest customer - almighty Walmart.  What a bargain!
Jun 29, 2011 2:48PM
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their is no reason why gas is this high to begin with, i live in ct. sorry to say, more so with this new governor in office that just raised diesel 3 cents more a gallon, so food will go up and everything else you buy so now he makes more on tax's, that's right tax's went up to 6.35, .35 more for everything that gets trucked in to this state.  i hope the trucking companies stop coming here and we need to go to another state to buy our supplies. drown ct.
Jun 29, 2011 6:03PM
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Schoolteach62

 

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%.

 

 

 

Jun 29, 2011 4:13PM
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@Jeremy

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

Jun 29, 2011 6:31PM
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I applied and got a wal- mart discover card a couple of years ago just to buy gas at Murphy oil in our town. I do not like wal-mart and have not set foot in our local super center in 3yrs, yet I use the card all the time at Murphy. I pay my bal. off every mo. so I do not care what the interest rate is. I say all this just to show you can beat w/m at their own game with a plan.
Jun 29, 2011 8:03PM
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Did any of you Wal-Mart haters notice that the promotion also applies to gift cards?  Next time I'm there doing my normal shopping, I'll pick one up to use for gas.  Our Wal-Marts usually have the lowest gas prices in town, and that's not too much hassle to save another 10 cents a gallon.  If you get duped into overspending & racking up credit card finance charges, that's your problem.  Over the past decade I've applied for Sears & Penney's credit cards in order take advantage of generous promotional discounts on big-ticket items.  As soon as the statements arrived, I paid off the balances in full & cancelled the cards (got a $150 winter coat for $85 doing that). It's not Wal-Mart's fault that some consumers have no sense or self-control.  Besides, this "gimmick" wouldn't be necessary if government would stop contributing to these outrages fuel prices through taxation & regulation.
Jun 29, 2011 2:54PM
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If they are going to sale their gas cheap, if my husband says lets get gas or I'm going to get gas at Wal Mart, I willing to get it there too. Wal Mart isn't the only company that screws their employees, there are many others that do too.
Jun 29, 2011 5:59PM
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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. 

Jun 29, 2011 7:49PM
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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.

Jun 29, 2011 6:38PM
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I drive by a walmart going to Pennys, Sears, K-mart, Target and Fred Meyer, I add that I go out of my way to drive past this walmrt, sometimes I wave mostly I just ignore them,  I get a 10cent gas discount at both Safeway and Fred Meyer, just buying what I want or need.
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