Marketing and distribution certainly plays an important part in the effectiveness of motor oil.
Im not sure that the Wal-Mart distribution model is conducive towards helping the average Joe get the best motor oil in his car. Honestly, does the average oil buyer at Wal-Mart come to BITOG and check out the latest UOAs? Seriously if you want to hear the worst and most biased information about motor oil then spend 10 minutes with shoppers at the Wal-Mart motor oil dept. Everyone has biases and most of them are ridiculous. One person will claim that Pennzoil will sludge up an engine while the next will tout the virtues of Quaker State because their Uncle Joe used it for 50 years. You will see people adding 20W-50 oils to brand new Honda cars that suggest a 5W-20 and they will do it in the middle of winter. Ask them why, and they will tell you that a 50 weight oil is better than a 20 weight oil and cousin Tom is a mechanic and told them so.
Wal-Mart could care less about selling the "best" oil. They want to move product.
Hutchinson Technology makes a .10 cent part for their suspensions that can double the life of a disk drive. Most disk drive companies ignore it. HTCH charges .10 cents extra and then the head manufacturers mark the thing up to sell to the disk drive companies who mark their products up to sell to computer manufacturers who mark up their products to sell to retailers who mark up their products to sell to consumers. Meanwhile, Wal-Mart has $500 computers on sale and you can bet your last dollar that longevity isnt a concern. Wal-Mart wants to move product and cheap prices help. If your hard drive crashes at 20,000 hours of use instead of 50,000 hours then Wal-Mart doesnt care though they will be happy to sell you a new computer. Most computers have only a single moving part and its the disk drive and the debate is germane to the discussion. Almost every person if informed would be willing to pay the .10 cents for the HTCH part if it would double the lifespan of the hard drive and in effect usually the computer. However, when the Wal-Mart computer sells for an attractive price point versus the more reliable computer then the masses buy the cheaper computer.
Im guessing that boutique oils face similar challenges. We can pretend that if Amsoil or Royal Purple or Redline sold through Wal-Mart that the prices would be lower. Maybe they would. However, dealing with Wal-Mart and Target and Autozone can be frustrating. Each retailer wants to scoop the other guy and get the best price for their customers. If you want to do business with Wal-Mart then expect very slim margins on your product. Ive seen M1 on sale at Wal-Mart for $3.79 per quart and Ive seen this price within the last 7 days. It wasnt a sale price. I doubt that Mobile or Wal-Mart either one is making much money off of this product.
Now perhaps this is good for the consumer but perhaps it isnt. Maybe Redline or Royal Purple would love to sell to Wal-Mart but Wal-Mart buyers are sitting there suggesting that they lower their price so that Wal-Mart can put a price point of $5 per quart on the shelf.
Will compromises be made and the oil downgraded?
Will the additives that might cost a couple of pennies per quart be removed and left out to meet the stringent price point demands? Will customers still be getting the same quality?
We can bash Amsoil and others for distributing their products in Avon type manner but perhaps it works for them. Perhaps Amsoil dealers do try to learn a bit about oil and educate their customers. Perhaps Royal Purple can manufacture their products to their standards rather than having to cut corners to meet a retailers price point shelf objectives. Perhaps an oil without price compromise like Redline might have some appeal.
A .10 cent component on a disk drive or a penny additive in a motor oil might not seem to matter to those that care about quality and most here would be those that do care. However, there are a thousand customers at Wal-Mart everyday buying the cheapest "40 weight" oil that Wal-Mart sells rather than looking on the back labels for GF-4 standards, SL qualifications, and Moly-ZDDP anti-wear additives.
If Amsoil sold its Ow-30 motor oil at Wal-Mart and brought its price point down to $5.50 it would bomb because most Wal-Mart consumers would walk right by it to purchase a grade 3 synthetic Super-Tech oil thats $2 per quart cheaper. Wal-Mart would drop the line after 6 months because of poor sales and Amsoil would go into bankruptcy.
Dealers would abandon Amsoil left and right and start buying through Wal-Mart and Wal-Mart still wouldnt sell enough product to justify its shelf space requirements for price to shelf square inch margin profitabily. Wal-Mart would junk the Amsoil to carry funnels or something that would make more money per square inch of shelf space devoted to it.
Maybe people like the Amsoil dealers and maybe they dont. But at least Amsoil doesnt have to bow down and kiss the feet of the Wal-Mart buyers who dictate to them price points of products on the shelves. As a result, Amsoil doesnt have to compromise on their quality.
Again, Im not saying that Amsoil is the best motor oil or isnt. But its nice to know that a company can produce a motor oil they believe in rather than letting the Wal-mart buyers engineer and design the product based on public perception of retail value.
90% of the people who buy oil care more about the price on the shelf rather than the oils ability to protect their car and enhance its lifespan.
Wal-Mart corporate buyers arent friends to the BITOG type fanatics who care about things like gas mileage, enhanced lifespan of vehicles, caring for their cars, and showing respect for their rides.
Wal-Mart wants cheap product for their shelves that will move fast and take money from consumers and transfer it to its corporate coffers.
Is compromise of quality for enhanced market share a good thing?
You decide.
Comments?
Happy Motoring All,
Bugshu
