“You have to be flexible to grow in Africa”
We talk to Amgad Elhanbaly, Corporate Head of Retail at OLA Energy, about the transformation of the African fuel and convenience retailer, adapting its business to different regions and the upcoming ReFuel Forum Africa event.
Amgad Elhanbaly, Corporate Head of Retail, started working for OLA Energy in 2019 after a long career at ExxonMobil. As the African company transitioned from Oil Libya to OLA Energy, Amgad was asked to enhance the retail visual identity (RVI) and help the African retailer reach its full potential. The company currently operates in 17 countries and has a distribution network of 1,280 stations.
When you decided to join OLA Energy, what potential did you see for the company?
The potential is enormous in Africa – the continent is very dynamic and young. There is a lot of growth. We have not yet had the opportunity to use all the technologies and all the tools that we have (discovered) in the multinationals in Africa. I experienced the change when ExxonMobil pulled out of Africa. To a large extent, the main challenge was flexibility – if you really want to make a difference in Africa, you have to be very flexible. At that time, as Europe moved towards electric mobility, I still saw a lot of development on the continent. I felt there was huge potential in retail and convenience concepts. New forms of communication completely change the perspective of the customer; people are exposed to what is happening in the world. To be able to continue growing in Africa is a great opportunity and a challenge for me personally.
This is an interesting point about the flexibility needed to succeed in the African market. How do you adapt your fuel and comfort offers to the requirements of each region ?
Our strategy is consistent but we are flexible on tactics. We would like to create a commercial hub concept that sells fuels, not a gas station with a store. We looked at what customers around us really needed. In Kenya, it is mobile payment, bank loans and some food offers with spaces for children. In Cameroon, we thought of a sushi bar or a spa… We are consistent because we have a forecourt, lubricants and a convenience store, and then we can connect different offers and formats of convenience stores. Sometimes we’ll have a 250 square meter store, other times we’ll scale it down to 60 square meters and focus on supply. We are consistent but we adapt to the environment.
How about the biggest differences in terms of customer behavior across regions in Africa?
The countries of North Africa are at an intermediate stage between Europe and sub-Saharan Africa. They are moving towards the European formula while keeping this African flavor. The North African customer expects fast service so we are very meticulous about the speed of the pump. For lubricants, OLA Energy is Mobil’s sole distributor across Africa. North African countries have the highest volumes of premium options because consumers are very sophisticated in terms of quality, speed and technology. They want good full-fledged services. We have service center and tire partnerships across the region – in Egypt with Bridgestone and Continental, in Tunisia with Midas and Bosch in Morocco. In city centers, the customer wants to get in and out quickly. And they appreciate the presence of multinational brands such as Starbucks and KFC.
As far as sub-Saharan Africa is concerned, I would say that time is not a major factor. The consumer likes to spend more time on our site. The convenience store can be considered a meeting place where you can spend your Sundays. In Kenya, for example, we have play areas for children. They’re not that particular about synthetic oils and that. These are the main differences between the two regions. We always play with these tactics, 65% consistent brand attributes, then the rest adapts to the needs of the local environment.
OLA Energy has developed a multi-brand strategy with the presence of global food brands. It also supports African chains like O’Good Food. What was the thought process behind this strategy? Why was it important to include an African Mark?
When I joined OLA Energy, I had the challenge of bringing international and local brands to work in one place. Our vision of being an African company was clear and we wanted most of the associated food offering within our convenience store (marhaba) to be an African brand. It was a priority. For our large sites, we also wanted to seize the opportunity to offer multinational brands. It was hard work because OLA is a new brand but they believed in our IVR strategy.
The food supply was a big challenge, especially in West Africa. I had to convince people that we could have a Pizza Hut and an O’Good Food, which also does pizza, in the same place. The one from O’Good Food has a very strong taste but the locals love it. You need to shape your decisions around the customers. If one store sells one brand of chocolate and another sells ten different brands, which one will she choose? Definitely the one with more variety. When a family comes to our site, parents are likely to be more associated with local food while their child will prefer the multinational brand. A varied offer is a great opportunity to meet different needs.
Another point is that working alongside international companies has raised the standards for local brands. O’Good Food has changed dramatically over the past three years simply by competing with these brands. We added a lot of value.
When it comes to technology, software and other applications, what are some of the big innovations you have overseen at OLA Energy?
There are two big innovations at OLA Energy. First, Automatic Tank Gauging (ATG) to automatically monitor our tanks and pumps. Our territory managers are connected to the sites via the application. I wouldn’t say it’s a big innovation because it’s been in the world for 20 years, but it was something new for Africa. The second is the loyalty app. We have started collecting more data about consumers and our staff on the site to understand their behavior. We are working on it because of the importance of the data. You have to be careful with the investments you make in Africa and not create a wedge between you and the consumer. We like to take it step by step.
Next week you will be speaking at ReFuelForum Africa in Cape Town. From your point of view, what is the value of the events like ReFuelForum?
They are very important. Investments are very critical and expensive right now. You have to think about investments, investments, the cost of fuel, supply issues… This is the right time for all the players to think together and share good practices. Let’s play together to support the industry; support our challenges and serve us all and the communities in a better way. I believe in these types of meetings, and I like to be there. At the end of the day, if we want to stay competitive, we need a healthy industry. This is the main part of these types of meetings. I hope people are open to sharing and continuing to network.
As gas stations expand their services, the number of competitors also diversifies. When you think of a bus station between Cairo and Alexandria in 15 years, how do you envision this site?
We are already working in this direction with our commercial hubs. We would like consumers to see gas stations as the third place between home and office because of clean restrooms, good food, rest, conference call, ATM use, etc. This is happening right now, especially in North Africa. Sixty percent of our customers already visit our sites without refueling. This will be done gradually, step by step. Consumers want a third place to rest on the road. I believe we will be ready for that.