Some things we expect to change—fashion, technology, the way we communicate—and while innovations in areas prone to “the next big thing” are often fascinating, we aren’t usually surprised simply by the fact that these things have changed. But every so often, entrepreneurs will come along and change an industry that wasn’t even on the radar of casual observers—Uber, for example, has in six short years forced people around the globe to rethink basic transportation options and how we interact with them. And so it is with Purple, the west coast based start-up whose sights are set on changing the gasoline industry as we know it with on-demand fuel delivered directly to personal vehicles—and the owners don’t even have to be there. Gas on-demand; what will they think of next?
Gasoline Delivery to Your Door (or, Parking Space, Rather)
The gas delivery company Purple, currently making waves in Los Angeles, its pilot city, has the potential to transform an industry that, as Business Insider notes, has “remained largely unchanged and unchallenged for the past 50 years.”
Purple’s mission is simple: use their mobile app to request (for now) either 10 or 15 gallons of gas (they offer Top Tier Unleaded 87 Octane and Unleaded 91 Octane) and it will be delivered to (and deposited into) your car within 1 or 3 hours. There’s no meeting the gas courier by your car—all you need to do is leave the gas tank open. You’ll get updates both before and after delivery, and you can schedule time slots between 7:30 a.m. and 10:30 p.m. (Business Insider notes that Purple plans to introduce overnight delivery in the near future).
For now, Purple is only available in some parts of the greater Los Angeles area, but the company told Business Insider they plan to expand up the California coast to the San Francisco Bay Area.
Does a Gas on-Demand Delivery Service Make Economic Sense for Customers?
Finding the best gas price is something of a sport for some people. If you aren’t someone who will drive three towns over just to save 5 cents per gallon, you know someone who will. So we know what you’re thinking: Purple’s gas delivery must cost a fortune—a price only those with buckets of disposable income and a penchant for luxury would pay. There is no delivery fee now, however at some point there will be. Purple says the fees are currently complimentary, to “encourage new users to discover and enjoy Purple.” On their website, Purple promises to “always charge competitive gas prices,” for the areas to which they deliver but declines to offer specifics. But Business Insider says the prices are fairly competitive: “Purple charges $3.79 per gallon for octane 87 and $3.99 per gallon for octane 91. For reference, the average price of a gallon of gasoline in the Los Angeles area is $3.56.” Though a 23 cents increase per gallon isn’t a fortune, it may be too much for the average driver to justify. In fact, Purple’s founder, Bruno Uzzan, admits to Business Insider that so far, people using his service are “those with luxury cars — around 80% — in the wealthy neighborhoods of Beverly Hills, Santa Monica, and West Hollywood.”
Is Gas On-Demand a Good Economic Idea?
The Huffington Post takes issue with Purple edging out gas stations and convenience stores that sell fuel. Most fuel stations (about 80 percent of them) aren’t run by big companies, they say, and are instead independently owned, often by immigrant populations. The Huffington Post argues that gas station ownership is often one of the best ways immigrant populations can get a leg up in the U.S. because, “they’re businesses that don’t require a team of investors, an advanced education, or technical skills.” They argue that a world in which companies like Purple proliferate, “the person who otherwise might run a gas station business will now be delivering gas to you, while some kid in Silicon Valley makes the profit.”
Will People Actually Use It?
In the last five months (since May) Purple has gathered 15,000 users, and they’re still only servicing a handful of Los Angeles zip codes. But it remains to be seen if average people across the country will pay a premium just to cut out going to a filling station. We imagine the service might be convenient for people living in big cities without gas stations nearby, but the truth is gas stations aren’t exactly difficult to find. The Huffington Post reports that there are approximately 150,000 gas stations in the U.S.—one station for every 1632 adults—which makes gas stations common. Also, the Huffington Post notes that full-service gas stations are almost non-existent these days (except in New Jersey, of course) because of their higher cost.
But if Purple can hit that sweet spot of not-too-high prices coupled with extreme convenience, they might just change how we fill up our vehicles. The company told Business Insider that they aren’t aiming for the entire gas station industry—right now, Purple is just looking to claim a small piece: “40 million people stop into a gas station every day. Even if we have only 0.1% of them, that would be 40 thousand users per day.”
Tell us what you think about gas on demand—is it the next great idea, or a convenience we don’t need?