According to a recent study conducted by EcoAlign, 87% of Americans indicated they would like utilities to suggest ways for consumers to reduce their energy bills. Rising energy costs, concerns of climate change and government reduction goals are a few factors that have left consumers and utilities searching for new ways to reduce energy consumption.
Just in the past few years, we have seen several technological advancements that are providing real solutions to meet modern energy challenges. For example, “Smart meters” are providing real-time data that can be used to monitor consumption. Such advancements have given utilities the opportunity to communicate with consumers about energy use on a personal level. With smart grid initiatives in the early stages of adoption, it will be important for marketers to pair this innovative technology with equally inventive marketing strategies.
Smart grid technology has been in the conversation for over five years. However, according to an EcoAlign study entitled Separating Smart Grid from Smart Meters, only about 1/3 of Americans are aware of smart grid. As marketers we will need to find a communication strategy that educates in a simple and targeted way. They key at this stage is consumer education and trust. While awareness is low, early advocates have had a positive response when asked about smart grid. When interviewed by EcoAlign early adopters identified smart grid as “intelligent”, “efficient”, “green”, and “technologically-advanced”. A good sign but we still have a long way to go to achieve mass-scale awareness and adoption.
The path to conversion isn’t always cut and dry. There are several studies that indicate individuals often desire to reduce consumption, but engage in behavior that is counter to their stated preference. There can be several underlying motivators that trigger an individual’s decision to reduce consumption. Not only are your costumers thinking on a rational level, but also on a subconscious emotional level. Our job is to segment your customers using targeted motivators or “push” points that will impact their decision.
Hunt Alcott observed emotional and social decision making in a group of energy costumers in a study entitled Social Norms and Energy Conservation observed. Alcott informed a group of high users that their consumption had consistently exceeded that of their peers. This proved to be very influential, and many began adopting reduction measures to meet levels of their peers. People aren’t just concerned about their financial well-being, but also social standing. This can be a very powerful tool – don’t be afraid to experiment.
It sounds obvious, but not all of your costumers are the same. Individuals have different wants, needs, concerns and, perhaps most importantly, convictions regarding energy use. A message that may connect on an emotional level with an environmental advocate may not resonate with someone who has more conservative views in regards to energy consumption. Some still view energy as a commodity that is and will be readily available to them at the flip of a switch. In fact, a recent poll conducted by Accenture found that the average customer thinks about their utility bill only six minutes per year.
Consumer segmentation will be the key to success in influencing wide-spread adoption of smart grid technologies. There are several consumer segmentation polls available. I’ll use Opinion Dynamics as an example. Opinion Dynamics identified five consumer segments classified by their opinions about energy consumption. Two particularly noteworthy groups were leading achievers and striving believers. Leading achievers (what we would like to call the low-hanging fruit), were identified as being passionate about energy efficiency, and showed high levels of interest in saving energy. Striving believers showed high personal interest in saving energy but failed to move to the next level (i.e. adopting an energy efficiency program). Both segments have very unique motivators, and can be converted with a targeted communication strategy.
With consumption data now readily available to providers, there are countless opportunities to engage user segments. Use this data to speak to your costumers on a personal level. Some examples include personal energy calculators, setting usage reduction plans and even real-time cost projections. It’s possible that we can provide consumers a way to actually see how small (turning off lights, washing on cold) or even larger-scale actions (buying an energy efficient appliance, adopting an efficiency program) can reduce their consumption in real-time.
With such transformation in the energy industry there’s never been a better time engage consumers. Smart grid can be a win-win for utilities and consumers. We can provide the communication tools to engage your costumers on a personal level. They may thank you for it by becoming passionate advocates for your program.
By: Adam Brooks