Gas App Creates Street Fight

A new gas savings app pits fuel retailers against each other.
January 03, 2017

WASHINGTON – Technology innovators see an opportunity to change how people pay for fuel at the pump, reports the Washington Post, and one company hoping to reinvent the market is Upside.

“The company’s secret sauce: exploiting a quirk in how gas stations compete for customers. Upside negotiates discounts on the price of gasoline sold at individual stations and posts them on a map accessible from a smartphone app. Users claim their savings by taking a picture of their receipt, much like the mobile check-deposit services many banks now use,” writes WaPo.

Upside claims it stands out among other gas-price apps by focusing on the supply side of the retail equation. For example, multiple gas stations on busy streets or opposite corners typically price fuel closely to remain competitive. What Upside does is “exploit” that competition by offering its services to just one retailer, as in whichever reaches out to Upside first, and then “shuts out” the other retailers so that they have no idea what the “true price” of fuel is at that station.

“Upside further obscures what the price is by offering a different discount to each user. This reduces the possibility of a price war breaking out; rival stations would have a difficult time figuring out how much they are being undercut,” writes the Washington Post.

The news source says that so far 650 gas stations in D.C., Maryland and Virginia have signed up for Upside’s services, which is turning down station owners whose competitors already beat them to the punch.

While the service is too new to determine whether it will be a success, it is drawing a following. The app has more than 5,000 downloads in the Google Play Store, with an average user rating of 4.2 out of 5 stars. Upside says it has “tens of thousands” of users in total.

“It’s about helping people do better with the basic necessities in their life,” Upside founder Alex Kinnier told the news source.