Brands must engage with new consumers about transition plans
The energy transition continues apace. Yes hydrocarbons will continue to have a crucial role for the global economy for decades to come, but oil and gas companies make decisions about their investments over a 20-30 year horizon and they are having to consider what investments they will make now to see them survive through that transition. The brand challenge is that many of these brands have either no relevance to consumers, because they have no fuel retail business, or they are synonymous with oil and gas. As replacement technologies grow and develop new brands, the oil and gas companies need to consider how their business will respond and their brands are going to need to develop a relevance to new generations of consumers. The competition for mind space will be with Google and Tesla, so brands are going to have to take on new talent, new thinking and boards are going to have to consider investment in brand in a way that they haven’t had to before.
Brands are helping Millennials appreciate the span of energy transition
Oil and gas companies have begun to focus on the millennial generation much more cleverly and rigorously. They are learning about the millennial voice and appreciating it will get only stronger as millennials get older. These brands are communicating with millennials now so that in 15 to 20 years time they are acknowledged as having played their part in the energy transition. The issue is that millennials want change more quickly - in fact they want it today. But to their dismay more carbon free technologies like solar do not yet have the scale and capacity to deliver the immediate change required. Oil and gas brands urgently need to persuade millennials that they are changing in a responsible and swift way. The fact is that many of these brands are changing, and changing quickly, it's just that quick change is still seen as glacial change by the millennial generation - and therein lies the rub.
Digital investments position brands for price rebound
The smartest oil and gas companies made effective use of the period of price decline to examine things that they did not address during the go-go days of $100 a barrel oil. As prices began to rebound, these oil and gas brands were the first to reach a level where production became profitable. They’d cut costs and looked at innovations that enabled them to compete at a much lower price threshold and get the last drop of value up and down the supply chain. These improvements include digitization of the oil fields, better predictive maintenance, better imaging of the sub-surface, and better technologies for getting the most out of reservoirs. The way top operators function now is a step change better in the use of technology than it was before the downturn. These are no longer wildcatters, they’re the cheetahs of the oil field.
EVP, Global Energy Practice Leader & General Manager
Brands have a chance to influence the changing energy conversation
In many ways, this is a great time for energy brands that have been investing in new technology and rebalancing their businesses to be profitable at lower crude prices, and who have been developing gas and other energy alternatives. Rising demand and the transition to a new administration in Washington has rekindled a global conversation about energy and those brands that hold true to their vision and values have an opportunity to be on the forefront of these discussions and help advance new energy solutions.
Senior Partner, Global Managing Director
Ogilvy & Mather