Current Issue

PREMIUM CONTENT FOR SUBSCRIBERS ONLY

Retail

Nitrogen marketing 101

Order Reprints
Nitrogen marketing 101

There’s a marketing phrase that’s been around for a long time — “There’s no such thing as bad press.”

Companies supplying equipment for nitrogen tire filling service and tire dealers who offer it may disagree.

Case in point. Last October, Consumer Reports magazine conducted a study to “find out if nitrogen is worth the price,” wrote Gene Petersen, CR’s lead test engineer, on CR’s follow-up Internet blog.

The magazine took 31 pairs of H- and V-speed rated, all-season passenger tires and filled one of each pair with air and the other with nitrogen. Petersen reported the tires were filled and deflated three times with nitrogen to purge the air out of the tire cavity. CR engineers also used an oxygen analyzer to be sure they had 95% nitrogen purity in the tire. (The Get Nitrogen Institute, a non-profit organization formed to educate consumers about the pluses of using nitrogen, says, “You can get all the benefits of nitrogen with a purity level between 93% and 98%.”)

Inflation pressures were set at 30 psi at room temperature. They then placed the tires outdoors, and then rechecked the tires’ air pressure at room temperature after one year had passed.

[PAGEBREAK]

Jennifer Stockburger, senior automotive and tire test engineer, automotive test center, tells us, “The study didn’t evaluate all the benefits of nitrogen, such as those to tire aging. Our objective was to find out if nitrogen offers a benefit in the area of air retention.”

Which it did.

The study found that the nitrogen-filled tires lost less air pressure, “an average of 2.2 psi vs. 3.5 psi for air-filled tires,” the magazine reported.

That’s good press, right? Well, not so fast. The magazine concluded the nitrogen item by saying, “But with either filling, you need to check tire inflation monthly, which means paying for nitrogen doesn’t make much sense.”

“Our fear,” says Stockburger, “is that our readers will use nitrogen as a crutch. Adding nitrogen to tires does not mean that you don’t have to check air pressure.”

CR has a basis for that fear. A Rubber Manufacturers Association (RMA) survey found that nearly 90% of drivers do not check their tire pressure properly and 66% of drivers don’t even know where to find the recommended proper tire inflation pressure for their vehicles’ tires.

There are many in the industry who take issue with the way Consumer Reports conducted the test.

Brian Brasch, president of the Get Nitrogen Institute, said, “It is unfortunate -- America has found a tool to significantly extend tire life, save 6.4 billion gallons of fuel and 6.8 billion gallons of diesel annually, thus saving every American up to $300 a year -- and Consumer Reports publishes another inconclusive study.

CR’s test of placing tires outside for a year, not even mounted on a car, is reminiscent of other questionable tests such as the safety seat fiasco last year. CR’s elementary nitrogen test proves that nitrogen holds pressure 38% longer than air, and yet they ended with, “paying for nitrogen doesn’t make much sense” as a conclusion.

“Get Nitrogen has asked for a formal retraction and an apology to all Consumer Reports customers. We encourage Consumer Reports to revisit this topic and we have shared nine other independent tests as examples of how this technology should be tested before reaching a conclusion.”

Stockburger reports the magazine has no immediate plans to test the other benefits of nitrogen.

[PAGEBREAK]

Ashok Mathur, business manager for UltraFill Systems, says that despite the fact that he respects Consumer Reports very much, he feels that the nitrogen testing was flawed.

He points out, “One, it was a very controlled environment, and the tires were not mounted on a vehicle. And two, the value of the result was minimal, and the conclusion was flawed. CR’s own testing showed an improvement in air retention, but the conclusion did not emphasize this.

“Consumers are not aware of the tire air pressure message. They need to take care of their air pressure to save gas and improve safety. Nitrogen is one of the possible solutions to make it easier for people to keep track of their air pressure. Nitrogen is a possible solution.”

John Lucidi, product sales manager for nitrogen inflation for Parker Hannifin, feels the CR test was not valid.

“They put tires outside for a year. A tire just sitting there doesn’t prove much. But there was still close to a 40% improvement in air retention with nitrogen. It would still benefit consumers if everyone saw a 40% improvement in air retention, there would be huge savings in gas and fewer greenhouse emissions.”

The Rubber Manufacturers Association’s (RMA) position is that “nitrogen is safe, and may have some advantages over oxygen. But people still need to check their tire pressures,” says Dan Zielinski, the RMA’s senior vice president, public affairs.

“Some marketing materials imply that nitrogen and only nitrogen will deliver better gas mileage, etc. In truth, properly inflated tires will get the advantages.

“If you want to inflate with nitrogen, great. Use oxygen? Great. Just check your tire air pressure!”

Zielinski asks, “Is it worth the money it costs to inflate passenger tires with nitrogen, when you can get them filled with oxygen for virtually no cost? I think that’s a fair argument that gets overlooked in nitrogen marketing literature.”

[PAGEBREAK]

An RMA Information Service Bulletin on using nitrogen to inflate passenger and light truck tires in normal service applications says:

“Nitrogen is an inert (non-flammable) gas — basically, nothing more than dry air with oxygen removed (air contains about 78% nitrogen). Because of its inert properties, nitrogen is often used in highly specialized service applications and/or demanding environments. Applications such as aircraft, mining, and commercial/heavy use utilize nitrogen to help reduce the risk of internal combustion (fire) if the brake/rim/wheel components overheat.

“Also, dry nitrogen is used in professional racing to help reduce variation in inflation pressures (caused by moisture) where even small differences in pressure can affect vehicle handling at the extreme limits of performance.

“For normal tire service applications, nitrogen inflation is not required. However, nitrogen inflation is permissible as its properties may contribute to minor reductions in inflation pressure loss.

“Nevertheless, several other sources of pressure leaks, such as punctures, tire/rim interface (bead), valve, valve/rim interface, and the wheel, may negate the benefit of nitrogen. If the tire inflation pressure is below the pressure specified on the vehicle placard, the tire must be re-inflated -- whether with air or nitrogen -- to the proper inflation pressure. Do not operate tires underinflated and/or overloaded.

“Depending on nitrogen alone to reduce the requirements for inflation maintenance may, in fact, lead to underinflated operation, which may result in premature tire failure. With the right amount of inflation pressure, you will achieve optimum tire performance. This means your tires will wear longer, save fuel and help prevent accidents.

“Whether inflated by air or nitrogen, regular inflation pressure maintenance remains critical and necessary.

“Use of nitrogen alone is not a replacement for regular inflation pressure maintenance.”

[PAGEBREAK]

Accentuate the positive

To reiterate, CR was not trying to take an all-encompassing look at nitrogen. It was simply looking at one aspect — air retention. And the results were positive, not negative.

When selling nitrogen tire filling service, dealers might want to use CR’s test results combined with the other positive aspects nitrogen proponents list, such as:

• Increased fuel efficiency — when the tire is properly inflated, the driver will get better gas mileage due to less rolling resistance.

• Longer tread life from less oxidation.

• Increased safety from properly inflated tires. Tell customers that under-inflated tires have increased deflection and create more drag and flexing which leads to heat buildup.

• Longer rim life from the elimination of water vapor which causes rust. Due to oil and water in most compressed air, it will slowly deteriorate the tire from the inside out. Water also absorbs and holds heat. The experts say that when water changes from a liquid to a vapor, it expands. So tires inflated with wet air tend to run hotter and fluctuate in pressure more.

Nitrogen is very dry, and will help block corrosion and keep rubber supple, the experts say.

• Improved retreadability due to better tire condition.

Use these advantages when selling your customers on the service and working to overcome negative feelings toward nitrogen tire filling.

“There is no bad press,” agrees Robin Pearl, president and CEO of N2Revolution Inc. “The CR article got people talking about nitrogen, and that’s good.”

And getting people to talk about the product helps in the marketing or “product adoption process,” as marketing gurus put it.

[PAGEBREAK]

Know your customers

Dian Sommers, senior marketing specialist for the Gardner Denver Compressor Division, says the way to sell nitrogen is to emphasize the return on the customer’s investment, namely increased safety and tire longevity.

Typically, dealers charge customers $20 to fill four passenger tires with nitrogen, or offer a four for $50 with a lifetime of free nitrogen refills, she says.

To make the sale, it helps to return to marketing basics -- know your customers and recognize product adoption processes and purchasing patterns. This is especially true when you are dealing with a product like nitrogen, which the customer can’t even see!

The product adoption process describes the sequence of stages consumers go through in the process of accepting new products. The stages include:

1. Consumers become aware of the new product.

2. They then seek information about it -- be it on the Internet or by asking retailers or other consumers about it. (If they’re checking the Web before they come to you, they will find all sorts of information -- and misinformation. As an example, in a response to an article written by the “Blueprint for Financial Prosperity” personal finance blog on the financial benefits of using nitrogen in tires, a man wrote, “Nitrogen is illegal in some states. Nitrogen, in a tire, if you run over a nail, will explode and cause some sort of a nitrous oxide. Nitrogen also has isotopes that can make that explosion stronger. So I wouldn’t put it in my tires. Also if this gas is mixed with carbon or oxygen it will be a sad story for that person if the tire bursts.”)

This is an extreme example, but if they Google nitrogen tire filling on the Internet before they come to you for advice and or tire filling, they will find headlines such as: “If it’s free, OK, if not, save your money.” “Nitrogen-filled tires -- the newest up-scale scam.” And “Nitrogen in tires -- Is it all a lot of hot air?”

3. If they find the facts, the consumer will develop a favorable attitude toward the product.

4. They then try it out.

5. They find satisfaction in the product trial.

6. And they adopt the product into a regular usage or repurchase pattern (which means they come back to you for refills).

[PAGEBREAK]

Marketing experts say consumers fall into five purchasing patterns:

1. The innovators -- these people make up only a small percentage (2.5%) of all purchases of the product. They will purchase a product at beginning of the product’s life cycle. They aren’t afraid to try new products that suit their lifestyle and will also pay a premium for the benefit. These customers want to be the first to own a new product, well before the average consumer. However, they often are not taken seriously by their peers.

2. Early adopters -- make up 13.5% of purchases. They are usually opinion leaders with their neighbors and friends and naturally adopt products after the innovators.

This group of purchasers is crucial because adoption by them means the product becomes acceptable, spurring on later purchasers, say the experts. They are quick to buy new products.

3. Early majority -- make up 34% of purchases and have been spurred on by the early adopters. They wait to see if the product will be adopted by society and will purchase only when this has happened. The early majority usually have some status in society.

4. Late majority -- make up another 34% of sales and usually purchase the product at the late stages within the life cycle.

5. Laggards -- make up 16% of total sales and usually purchase the product near the end of its life -- if at all.

They are the “wait and see” buying group. They wait to see if the product will get cheaper.

It will help you to recognize which pattern your consumers fall into, and gear your sales pitch accordingly.

“Some technologies take time to grow and catch on,” says Phil Giallombardo, director of sales for Branick Industries Inc. “But dealers are looking for new revenue streams. And one big plus with nitrogen tire filling service is customer retention. If they buy nitrogen from you, they tend to return to you, which is what tire dealers want!”

[PAGEBREAK]

UltraFill’s Mathur says, “There is one message with no ambiguity, and no lack of data: nitrogen is better. The question is, what is the cost to the consumer for this value? Nitrogen is better, it will retain pressure better and tires will last longer.

“But how much are customers willing to pay? Five dollars a tire? A lot depends on the dealer’s competitors.

“Dealers are offering free breakfasts, free TV, free Internet hookup, etc. They are spending a lot of money for customers to feel good. It’s all about the buying experience,” says Mathur. “Nitrogen helps in that regard. Dealers need to include it in tire sales, offer free nitrogen fills for the life of the tire.

“Dealers were initially concerned that nitrogen service would tie up service bays. This is not a time-consuming service. Dealers want customers to come back so they can have that second or third contact. It has proven good for customer retention.”

Pay it forward

Fred Marino, president of NitroMax Green, the marketing arm for On Site Gas Systems Inc., says the profits come from the marketing savvy of the servicing dealer.

NitroMax Green helps their customers by offering a marketing program. The program includes a key fob that is given to each customer who has their tires inflated with nitrogen.

After the service is completed, the customer registers on the Web site www.mynitromax.com by inputting their unique number found on their key fob. They can then print out their tire warranty with information on NitroMax’s one year free roadside assistance and one year’s worth of free tire repairs.

“This builds customer retention,” says Marino, “and dealers love customer retention.”

In addition, the company has a four-minute video available that explains the benefits of nitrogen to customers in a dealer’s waiting room.

Pearl of N2Revolution, which offers the PurigeN98 system, says, “Dealers need to create a value for it so they can charge for the premium product.

“To build credibility, make sure the consumer knows he’s buying something worth paying for.”

[PAGEBREAK]

Giallombardo offers dealers his company’s “ABCs of selling nitrogen”:

A -- create Awareness.

B -- help them make the Buying decision.

C -- have them Come back to the dealership.

Branick frequently launches press releases to get the word out about the advantages of using nitrogen, and they have ad slicks available for dealers to use.

They also have, for a small fee, what they consider the basics to be successful selling nitrogen including banners, counter displays, literature and green valve caps (98% of the companies selling nitrogen equipment are on board with the green caps, he says.)

He feels that, “Dealers don’t like the fact that Costco gives away the service, but they have helped spread the word, and the customers have to buy tires to get it. So if they buy four tires for $500, it’s not free.

“Costco has helped educate the consumer, has planted the seed in consumers’ minds that nitrogen provides benefits for tire safety and longevity. Also, it says there’s a reputable company standing behind nitrogen.”

He says there are “pockets of acceptance. Some dealers are digging in their heels, not wanting to offer nitrogen tire filling. It has gone over big in Florida, Southern California — the Los Angeles area especially. It is usually more popular in warm weather climates, but there also are pockets on the East Coast. It spreads from the West Coast.

“Numbers will continue to grow. Lots of services are added because people have to perform them to survive — such as servicing TPMS, brake lathes, balancing equipment. Selling nitrogen is different.

“If you put nitrogen in a customer’s tires, then affix a decal on his car, or offer coupons for the service, customers will return for service. There are usually not a lot of places in any area where they can get nitrogen.”

Giallombardo adds it is important that dealers ask themselves, “Am I losing business because I don’t offer it?”

Lucidi of Parker Hannifin reports they sell their equipment with our without their marketing kit, which includes a display stand, bifold literature of high quality that explains the benefits of nitrogen, a banner, poster, a display stand and buttons that sales people and technicians can wear that say “Ask me about nitrogen.”

He says dealers are buying into the technology, as are car dealers. And tire dealers should note that, he says, “It’s a bigger market for car dealers. They are tying it into other services such as oil/lube, new car sales, etc. They have more opportunity to sell it every day.

(Note, however, General Motors’ position on the use of nitrogen in tires: “General Motors does not oppose the use of purified nitrogen as an inflation gas for tires. We expect the theoretical benefits to be reduced in practical use due to the lack of an existing infrastructure to continuously facilitate inflating tires with nearly pure nitrogen. Even occasional inflation with compressed atmospheric air will negate many of the theoretical benefits. Given those theoretical benefits, practical limitations, and the robust design of GM original equipment TPC tires, the realized benefits to our customer of inflating their tires with purified nitrogen are expected to be minimal.”)

“Tire dealers are having a harder time selling nitrogen than car dealers. Those who are successfully selling the service are seeing a payback. If you use it as an upsell to tire sales, using it as a value-added service, you’ll be successful.”

[PAGEBREAK]

Jay Lighter, chairman and CEO of Kreska Technologies Inc., supplier of NitroFill systems, reports his company offers what he calls “a customer retention and profit generation program.”

NitroFill offers “Cap Kits” that include self-sealing, chrome-plated metal or plastic valve caps that feature the NitroFill logo, a windshield sticker and a registration card/key tag.

Each Cap Kit also includes a 12-month membership in the NitroFill Auto Club. Customers activate their NitroFill Auto Club membership also by registering on theNitroFill Web site — www.nitrofill.com. They then print out their benefits page and the program captures the customer’s e-mail address and codes it to the selling dealership for delivery of monthly personalized newsletters.

The NitroFill Auto Club includes 12 months of tire road hazard repair and replacement coverage and unlimited use of roadside assistance benefits that include 24-hour emergency towing and road service, 24-hour emergency fluid delivery, 24-hour emergency battery service, lost key and lockout service, travel benefits, theft and hit-and-run protection, trip routing service and trip interruption service. All the benefits can be used as often as necessary during the 12 month coverage period, the company reports.

The Cap Kit program also includes 12 customized monthly NitroFill newsletters that are sent to each customer via e-mail featuring and promoting the dealership that sold the program.

The Auto Club requires no participation from the tire dealer. Newsletters are fully automated and require no input from the dealer. However, dealers can customize them by adding coupons, etc., if they so desire.

To help ensure customer retention, the 12th and final e-mail from NitroFill instructs the customer to return to their tire dealer to re-purge their tires and renew their Auto Club benefits. NitroFill also e-mails the name and phone number of each customer to the dealer two weeks prior to their program expiration so that they can contact them and invite them back for another nitrogen service.

“Our marketing program is the most significant part of the service. It really bonds the customer to the tire dealer,” says Lighter.

Ryan Lang, Ingersoll Rand Industrial Technologies’ commercial portfolio manager, air solutions, says his company offers a sales kit with its nitrogen generating equipment.

The kit helps dealers educate their customers on their return on investment by telling them about how the added air retention gives them more mileage, added tire life and a softer ride. He says there are a lot of naysayers and a lot of “crazy sales tactics.” What is needed is training on how to combat both with facts.

To this end, the company provides point-of-purchase materials with each unit they sell. These include banners, counter cards, counter mats, trash bags and hang tags -- all with a positive nitrogen message.

Dealers also can sign up for training on the Get Nitrogen Institute’s Web site at www.getnitrogen.org.

[PAGEBREAK]

Tire Service Equipment Mfg. Co. Inc. reports it has banners, tire stack covers, valve stem caps, brochures and counter mats all to help the dealer sell the product to the consumer.

“Often the dealers will sell nitrogen tire filling for four for $20, or four for $50 with lifetime free refills,” a company spokesman tells us. “But the way to sell it is by selling the safety benefits, and the fact that you don’t have to check air pressure levels as often.”

Mathur adds this plays right into the case for nitrogen working with the tire pressure monitoring system (TPMS).

The Get Nitrogen Institute reports nitrogen will improve TPMS performance and details a case in which a customer ‘s TPMS dash light went off every four to five weeks. After inflating with nitrogen, her light didn’t reappear for 53 weeks.

“TPMS is seen by many as a nuisance,” Mathur says. “The light goes on, or there’s a beep when the pressure gets low. Nitrogen helps maintain the correct pressure, so there is less pressure loss and fewer tire pressure warnings.

“Nitrogen is good with TPMS sensors, since it is an inert gas. Nitrogen is used in many electronic applications because it is an inert gas.

“And by the time a sensor goes off, there has already been a significant amount of lost gas mileage, reduced tire life, reduced safety,” Mathur adds.

“TPMS is a diagnostic tool; nitrogen is a solution. The safety issue is the slam-dunk.”

Knowing your customers and being aware of what they have ingested about nitrogen tire filling from a wide variety of sources -- and taking advantage of all the marketing information and programs that nitrogen generating companies have to offer -- will help you counter any “bad press.”

Who is the Get Nitrogen Institute?

The Get Nitrogen Institute is located in Denver, Colo., and is sponsored by:

• Parker Hannifin Corp.

• Branick Industries Inc.

• Champion — Gardner Denver Inc.

• Costco

• Myers Tire Supply Co.

• Tire Retread and Repair Information Bureau (TRIB)

• Tire Service Equipment Mfg. Co. Inc.

• Ingersoll Rand

• Haltec Corp.

For more information, see www.getnitrogen.org or call (800) 406-6044 or (303) 601-8109.

[PAGEBREAK]

Increased popularity: MTD survey results show strong interest

Although nitrogen tire filling has been around for a long time, the service has been receiving increased interest among tire dealers in recent years.

Surveys conducted by Modern Tire Dealer prove this. In 2006, only 10% of dealers were offering nitrogen tire filling. A survey conducted just a couple of months ago found that number had doubled, and another 8% were planning to add the service in the future.

'Blue is the new green’

N2Revolution Inc. uses blue caps instead of green. “We have the machine that guarantees the highest purity levels, that’s why we use the blue valve stem caps -- to differentiate ourselves. Blue is the new green,” says Robin Pearl, president and CEO. “Our equipment also ‘shows well.’ The dealer should take the customers to the bay to see the nitrogen equipment.”

They also offer promotional material for the dealer’s showroom.

The company has shipped more than 1.4 million blue caps, so they know more than a million tires are filled with their nitrogen.

And N2Revolution is coming out with a new consumer campaign next month, with one of the tag lines being, “Blue caps for blue skies.”

Stay tuned.

Related Articles

Tire Discounters Runs 101 Stores in 5 States

From air to nitrogen

Nitrogen-generated profits: Facts overcome customers' fears of the unknown

You must login or register in order to post a comment.