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Markets

KenolKobil offers loyalty card holders Sh5 per litre discount as rivalry surges

A KenolKobil worker shows a motorist how to use K-Card, the marketer’s loyalty reward card. PHOTO | FILE
A KenolKobil worker shows a motorist how to use K-Card, the marketer’s loyalty reward card. PHOTO | FILE 

Oil marketer KenolKobil has started offering subscribers of its loyalty card a Sh5 per litre discount two days a week in a move that points to increased competition for market share between petroleum retailers.

The firm said motorists with its fuel card dubbed K-Card will on Wednesdays and Sundays pay Sh5 less per litre, while cash customers are to enjoy a Sh3 discount. On other days K-Card holders pay Sh2 less a litre of petrol and diesel.

A litre of petrol in Nairobi is retailing at a maximum of Sh91.56, while that of diesel is retailing at a maximum of Sh82.12.

“Enjoy a Sh5 discount per litre on your K-Card and Sh3 per litre for others…every Wednesday and Thursday,” said KenolKobil in an advert placed in local dailies Tuesday.

The dynamics of the retail oil market have been shifting in recent years as the established dealers continue to cede ground to newer players in the sector.

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Offering discounts to customers using loyalty cards is a therefore a way of keeping hold of business for the established players.

Market data compiled by the Petroleum Institute of East Africa (PIEA) shows that Kenya’s top three oil marketers lost a combined 20.6 per cent share of local petroleum market sales in the second quarter of the year compared to the previous year.

Total Kenya, Vivo (Shell) and KenolKobil held a market share of 51.3 per cent in the quarter ending June 2016, compared to 71.9 per cent a year earlier.

Smaller oil marketers such as Gulf, Hashi, Oil Libya, Tosha, Bakri and One Petroleum have on the other hand been making gains in the market as they open more outlets across the country.

Independent oil marketers have also been using discounting as a way of attracting more traffic to their outlets, offering discounts that are up to Sh1.50 below the official price.

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