In my local area (Tacoma, WA) I have noticed Mobil service stations popping up after an absence of several years. What struck me as odd was that Mobil and Exxon are owned by the same company, and yet you still see an odd Exxon station around this area. Why would you have two competing brands from the same company around? Why do big oil companies decide to operate in some markets and not in others?
I don’t know, but it seems to me the best business to be in would be the sign business. Banks and gas stations would give you plenty of business!
It would depend on the franchise agreements. Oil companies do indeed carve up the country in various ways. The Mobil/Exxon split was originally dictated by the antitrust action against Standard Oil, which split it up into about 34 companies, all in different geographic areas (they quickly began merge back again).
As for why there are both, probably the existing Exxon stations had franchise agreements that said they would only be Exxon stations. When the agreements expire, they may be required to change. Or not, depending on what ExxonMobil wants to do.
Competing brands from the same company are common in all industries. GM owns Chevy, gmc , Buick, and Cadillac .
Multiple brands give you a stronger presence in the market.
Take as an example if the dominant fuel brands in a region are Shell and Exxon. Each gets about half the business. If Exxon re-brands some of their locations as Mobil, they now control 2/3 of the “name brands” vs just half without changing the actual number of locations that they control.
Shell will still have its fans, and Exxon will have its fans, but there’s a certain number of people who may think “Wasn’t Exxon the company that dumped all that oil in Alaska?” and want to avoid them, and some will think “My Dad always bought Mobil and his car always ran so smooth, so I’ll buy their gas.”
Like anything else, most people buy gasoline based on emotional reasons rather than technical ones. Some people will value the “premium” experience at the more expensive location as it’s less busy so they can get in and out quickly, but others will happily wait in line at the cheap place to save a few bucks.
Splitting the brands also allows the parent company to manipulate brands’ reception by consumers. Tesoro, one of those giant corporations you’ve probably never heard of sells gas in the US under (among others) the Shell and ARCO brand names. By keeping the two separate, Tesoro doesn’t dilute people’s perceptions of Shell as high-end stuff while raking it the sales at the significantly cheaper ARCO.
GM’s brands don’t compete against each other. While there’s a bit more interplay nowadays than there used to be (where the upwards progression from Chevy to Pontiac, Buick, Olds, Caddy was very well known and easily seen in each vehicle,) someone in the market for a Cadillac isn’t going to be checking out a Malibu. Cadillac is competing with Lexus and Mercedes, not other GM brands.
I have a client who has 3 business names, same product, but with differences in response time and level of services offered.
Its amusing watching him and his wife answer phones.
Maybe OP is in a 7eleven area.
7-Eleven signed an agreement with ExxonMobil in December 2010 for the acquisition of 183 sites in Florida. This was followed by the acquisition of 51 ExxonMobil sites in North Texas in August 2011.
More to that story … they did try using the 7eleven brand only, but decided that people didn’t trust 7eleven as a name for fuel and they should really have 7eleven sites selling Mobil brand fuel.
Huh! That’s interesting, I Did Not Know That! Haven’t seen an ARCO in a long while, but Tesoro has several filling stations around my neck of the woods (they are a relative newcomer to this market under the Tesoro brand though). Shell is around but has become a little less common in the past few years while Chevron has proliferated with a local franchise chain angling for the (until recently)non-existent high-end “luxury” convenience store/filling station.
Just for a moment there, I heard Johnny Carson’s voice.
I didn’t know that the ARCO brand still even existed. I worked at an Atlantic brand gas station in Massachusetts as my first job at 16 years old in the 1960s. A year or so after I started work there, Atlantic became ARCO, and the signage changed at the station (though the station itself was a franchise, so I was still working for the same guy under the same arrangements). Eventually, years after I stopped working there, the station went out of business, and other ARCO outlets in the area switched to other brands. I still live in the northeast (now New Jersey, not Mass.), and have traveled quite a bit in the eastern half of the US, but I don’t believe I’ve seen an ARCO station in decades.
In some cases they do, or they have, i.e. Chevy Tahoe vs. GMC Yukon, Blazer vs. Jimmy(now discontinued).
Slight hijack, but considering that many local markets have both Chevrolet and GMC dealerships that are owned and operated independently from each other, and each brand runs its own ad campaigns, is General Motors under any obligation to dealers to market its individual brands in a way that they don’t cannibalize one another. For example, if Chevrolet launched an ad campaign for the Tahoe that ended up being especially effective among a particular demographic, it could negatively affect Yukon sales within that same demographic. Is this an actual issue between manufacturers and dealers that is addressed in the various contracts that govern relations between them?
They have a significant presence on the west coast. IIRC, they have a >50% market share in California.