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Gasoline giveaway

Soaring fuel prices mean that for many businesses gasoline has become the hit giveaway product of the moment.
Washington D.C. Council member and mayoral candidate Vincent Orange greets customer Bertha Salazar, who takes advantage of the cheap gas prices at a Shell station in Washington.
Washington D.C. Council member and mayoral candidate Vincent Orange greets customer Bertha Salazar, who takes advantage of the cheap gas prices at a Shell station in Washington.Marvin Joseph / The Washington Post
/ Source: a href="" linktype="External" resizable="true" status="true" scrollbars="true">The Washington Post</a

Gas station owner Joe Mamo knew he'd hit a home run with his publicity stunt when hundreds of drivers lined for up two hours to buy a tank of regular gasoline for $1.99 a gallon. The traffic around Mamo's station caused police to close streets and other drivers to improvise detours around the clogged blocks.

Mamo wanted to promote his newly renovated Shell station at Connecticut Avenue and Fessenden Street NW; what he got in the process was a lesson in consumer behavior.

"It's all psychological," Mamo said. "It's a windfall."

And that frenzied reaction is why gasoline has become the hit giveaway product of the moment. Mitsubishi is giving away up to $2,500 in gas to buyers of 2005 SUVs. PNC Bank just finished a promotion offering $25 worth of gas to customers who open a certain kind of online account. Even the entertainment industry is getting into the free-gas business: In August, TVT Records gave away a year's worth of gas and 500 $50 Exxon Mobil gift cards to promote the debut of an album by hip-hop artists Ying Yang Twins. The promotion generated 50,000 hits on TVT's Web site.

"It's something that everyone needs," said TVT publicist Joe Wiggins. "You can give away a car, but some people are like, 'Hey, I don't want to pay the taxes on that.' "

'A very emotional type of product'
Consumer-psychology experts say it's not surprising that gasoline giveaways are popular right now.

"Gasoline is a very emotional type of product at the moment, and it's highly visible. It's on people's minds a lot," said Lars Perner, an assistant professor of marketing at San Diego State University who specializes in consumer behavior.

Bargain-hunting behavior is most pronounced when the promoted item has a well-known value, Perner said, which is why supermarkets have successful promotions of frequently purchased products such as soda or milk. People are flocking to gas giveaways because it's the ultimate bargain -- clearly a good deal for a product whose value is well known and shown right on the street.

Yet there's often an irrationality to bargain-hunting. Research has shown that aggressive bargain-hunters generally get an average return of about $5 an hour, so it's not a particularly profitable endeavor. People do it because it makes them feel good about themselves.

"You get a certain benefit from getting a bargain, over and above the financial benefit there's a psychological benefit," Perner said. "There are a variety of reasons why people may feel that -- one is the thrill of beating the system. Another is demonstrating the skill of being able to find good bargains."

Focused on the savings
Certainly, the drivers waiting in line at Mamo's Shell station yesterday weren't thinking about intangible costs, such as the gas they consumed to drive across town or the time and gasoline it took to wait in line. They were focused on the per-tank savings they reaped.

Kelly Jones, a lawyer, drove to Mamo's station from her home in Northeast only to sit in her Camry for an hour and a half to get her tank filled. But she was thrilled with the $28 price for a little more than 14 gallons. "Absolutely, it was worth it," she said.

Yet according to AAA Mid-Atlantic, a car uses up to a gallon of gas an hour when idling. And then there's the time spent in line.

But none of that mattered to Emma Henry, either. The retired cook filled up two cars at Mamo's station, driving her Mitsubishi Endeavor there early in the morning and returning in her son's sedan to fill his tank -- just before the station's noon cutoff for the low prices.

"I'm just glad this day came," she said.

Of course, that kind of gratitude is hard to find in the typical giveaways -- a toaster, a plant or maybe even a cheap cell phone. But experts say giving someone gas is not only giving them a bargain, it's also giving at least temporary freedom from an expense that, for many, has become a stressful burden on the budget.

According to Marshall Reavis, managing director of SVM LP, an issuer, marketer and distributor of prepaid gas gift cards for Exxon Mobil, Shell, BP, Texaco and others, the cards are being used by newspapers to reward distributors and subscribers, by hotels and inns to lure visitors and by employers of all kinds to reward good work.

"It's growing spectacularly," he said.

What's next?
Because people tend to have such a positive response to free gas, can Christmas gifts of gas be far behind? Expect a lot of gas as stocking stuffers this season, Reavis said. He's expecting sales of gas gift cards over the holiday season to be "at least three times" what they were last year.

Already, the cards have taken off at supermarket chain Giant Food. Giant has been selling Shell gift cards, but they weren't selling well, so they were going to be discontinued. Not so fast.

"In the last period, we saw almost a 50 percent increase," said Jamie Miller, a spokesman for the chain. "We're going to watch the sales of the remaining gift cards and make a decision about what we're going to do."