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GM Goodwrench Oil Program. Cadillac Service Manager Council – May 17, 2010. Agenda. - Program Overview - Key Program Benefits - Pricing / Options - 2010 Program Enhancements - Marketing Support Premium Products Practical Training Proven Selling Tools Powerful Promotions
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GM Goodwrench Oil Program • Cadillac Service Manager Council – May 17, 2010
Agenda - Program Overview - Key Program Benefits - Pricing / Options - 2010 Program Enhancements - Marketing Support • Premium Products • Practical Training • Proven Selling Tools • Powerful Promotions • Profitable Results - Open Discussion
GM Program Overview • Growth Drivers: • Field Sales Forces • Competitive Pricing • Appealing Program Elements • Dealer Training Total GM Program Sales Currently Deliver Bulk to 3300 GM Dealers Nationally
Key Program Benefits • Exclusivity / Differentiation • GM Goodwrench is only Available Through Program • Competitive Pricing • Nationally Negotiated Pricing on Behalf of Dealer • Option 1 vs. Option 2 Pricing • Historically Competitive vs. Branded Competition • Historical Price Protection / Stability • Protection Not Typically Afforded with Locally Negotiated Offers • Stability in Volatile Market Conditions • Large Dealer Group Volume Rebate • Rebate on all Gallons Purchased / 200K gallons to qualify for highest rebate tier • Elite Distribution / Customer Service • GM Goodwrench Distributors Carefully Selected • Distributors offer One Stop Shopping for Lubricants / Ancillaries • 3 Levels of Support • General Motors FOM • ExxonMobil Territory Manager • Local GM Distributor Sales Representative
Best In Class Distribution Network • Attributing to our Leadership in OEM Program Execution and Results • 82 of our Best in Class distributors service the coveted GM program • Distributor Sales Force of 300+ • Strategically selected • Delivery and service when you need it
Key Program Benefits • Equipment Loan Options • 100% Interest Free Loans Available for Qualified Dealers • Up to $3 per Annual Gallon • Volume Commitment vs. Time Commitment • Vendor Consolidation • GM Products Must be Used to Earn Warranty Premium on Warranty Repairs • Local GM Distributor Already Delivering some products to mostGM Locations • Convenient Ordering / Billing • Locally Housed Product is Delivered by GM Oil Distributor (Keep Full Service Available) • Product is Invoiced on GM Parts Statement
Key Program Benefits – Convenient Ordering and Billing GM Dealership orders GM Goodwrench product from Distributor. (PROCESS BEGINS) Distributor delivers GM Goodwrench product to Dealership GMSPO paysExxonMobil (PROCESS ENDS) Distributor has 30 days to Send in communication GM Dealership pays GMSPO Distributor electronically communicates delivery to ExxonMobil GMSPO invoicesGM Dealership ExxonMobil communicates invoice to General Motors electronically (Approx. 600 Daily)
2010 Program Enhancements The Performance Incentive Program (PIP) • Designed to Reward Dealerships for Growth • Parts Sold on Customer Pay ROs • Objectives Communicated to Dealers by GM • Essentially 3% Growth over Previous Quarter • 100% to 104.9% of Objective Earns 3% Incentive, or $0.17/gallon • 105% to 109.9% of Objective Earns 5% Incentive, or $0.29/gallon • 110% of Objective Earns 7% Incentive, or $0.40/gallon • Incentive % Paid on All Eligible GM Parts • GM Oil is an Eligible GM Part When Incentive % is Paid • Incentives Credited Monthly *Based on Option 2 Price of GM Goodwrench 5w30 Bulk - $5.75
2010 Program Enhancements Volume Dealer Incentive (VDI) • New For 2010 – Replaces GM Parts Master Wholesale Program • Based Simply on Total GM Parts Purchases • Rolling 12 Months Parts Purchases Used to Determine Tier • $2,000,000 Total Parts Purchases in Previous 12 Months – 1.25%, or $0.07/g • $2,500,000 Total Parts Purcases in Previous 12 Months – 1.75%, or $0.10/g • $3,500,000 Total Parts Purchases in Previous 12 Months – 3.0%, or $0.17/g • $5,000,000 Total Parts Purchases in Previous 12 Months – 3.5%, or $0.20/g • April 2009 through March 2010 Determine Qualifying Tier for April 2010 • Qualifying % is then Applied to all April Parts Purchases (GM Oil Included), and Credited in May. *Based on Option 2 GM Goodwrench Bulk 5w30 - $5.75
Comprehensive Product Offer, Featuring Mobil 1: Factory-fill and service fill in leading OEMs More OEM Endorsements than Any Other Oil in the World GM Dealers have a Competitive Price Advantage (quart and bulk) Premium Products Worlds Leading Synthetic Motor Oil
On-Site Program, Product, & Sales Training for Service Advisors at no Cost to the Dealer How to Turn a Loss Leader into a Profit Center How to Increase Profitability Through Sale of Premium Products DON’T SELL.....JUST OFFER! Practical Training
Proven Selling Tools • New GM Goodwrench Program Guide – 1Q • New POS – Menus, Counter mats, banners
Powerful Promotions Goodwrench and Go Promotion • April – May 2010 • $10 Consumer Rebate for an Oil Change at a Participating GM Dealer • If Dealer is Using GM Goodwrench Oil, Dealer Pays $5, and GM Pays $5 • If Dealer is Not Using GM Goodwrench Oil, Dealer Pays the Entire $10 • Depending on the Redemption Rate, an Analyses can be Done to Determine what the Value of this Promotion is in terms of cents per gallon
Powerful Promotions • National Promotions Designed to Drive Customer Retention • No Charge to the Dealers • April, May, June 2010 - ‘Step Up to Mobil 1’ • Customer that Purchases Mobil 1 Oil Change from GM Dealer will Receive a $14 Check from ExxonMobil for Next Mobil 1 Service. • Check will be Made out to the Dealer that Sold the Service, and can Only be Redeemed at that Dealer. • Same Applies for Mid-Tier Products, but the Check Value is $7 • Redemption Rates for These Promotions Far Exceed Industry Average
Powerful Promotions Mobil 1 Incremental Growth Rebate • In Conjunction with GM’s Focus on Performance Incentives, this Rebate is Designed to Reward Growth • Timing is April 1 through October 31 • Requirements to Participate: • Must be Enrolled and Participating on the GM Goodwrench Bulk Oil Program • Must Schedule and Complete the Mobil Premium Products Training for GM Dealers • For Every Gallon of Mobil 1 Purchased Through the GM Program above that Purchased During the Same Period in 2009, the Dealer will Receive $1.00 per Incremental Gallon • If April through October 2009 Purchases were 500 gallons, and Dealer Receives Training and Purchases 1000 Gallons from April through October 2010, the Dealer will Receive a Credit of $500.00. • If Prior Year Purchases were 0, then all Gallons purchased from April to October 2010, if on the GM program and Trained, are Eligible for the $1.00 Rebate.. • Baseline Purchases Will Be Provided by ExxonMobil Territory Manager • Enrollment Form, Signed by the ExxonMobil Territory Manager, Must be Received to Confirm Training and Program Participation.
Profitable Results • Our Goals are to Drive Customer Retention and Increase Dealer Profitability. • Industry Installer Average for Synthetic Sales is 10% • Industry Installer Average for High Mileage Sales is 13% • Mobil 1 Represents 7% of the Total Volume on the GM Program • Mobil 1 Represents 58% of the National Synthetic Sales • 2009 Sales of Mobil 1 Through GM Dealers was the Highest Ever (130%PY), During Dire Economic Conditions
Profitable Results Focus on Dealer Profitability & Customer Retention
Profitable Results Premium Product Sales is a Key Benefit of the GM Program • Growth Drivers: • Dealer Training • Cadillac Factory Fill Relationship • Synthetic Promotions • Brand Recognition • Desire for Increased Profitability
Cadillac Dealer Participation • Total Cadillac Dealers = 1,282 • 1,089 dealers or 85% currently purchase Mobil 1 on the Goodwrench Oil Program. • As of Dec 2010, 307 dealers or 24% are buying Mobil 1 in bulk. • Mobil 1 bulk penetration will continue to be a primary objective in 2010.