by: Stephanie Crockett and Pete Wiezalis, Mower
The utility sector continues to undergo a significant period of transformation. From the rise of renewable energy and the decline of coal to paperless bills and smart grids, utilities have gone from “taking money from ratepayers” to “serving customers with new solutions.”
Business models have been upended and customers are demanding more. Many utilities have expanded their products and services into areas beyond simply delivering power. But chances are high that customers have no knowledge of those products and services.
According to a survey conducted by Mower which interviewed 500 homeowners across the United States, 66 percent of customers are not aware of utilities offering products and services beyond basic energy.
Interestingly, 2/3 of customers like the idea of getting more than just the basics from their power company. The convenience of one company providing multiple services had appeal to respondents.
When asked what types of products and services they would consider buying from their utility (see Table, below), respondents indicated that they would willingly pay for things adjacent to what they sell, including electrical services such as repairs, inspections, and wiring work.
Other products had appeal, including security lighting, surge protection and home repair plans.
Respondents in the South are significantly more likely than all other regions to consider buying post lamps and tree trimming services.
The research indicates that customers do trust their utility, overturning a long-held assumption that customers hate their utilities. The reality is that utilities have more credibility than they think and the opportunities to sell these adjacent products and services that link to energy or their homes are higher than they realize.
Be the Heart. Not the Cart.
The survey shows that 68 percent of respondents would be motivated to consider and/or purchase products or services beyond electricity from an electric utility, especially if discounts are available to help them save money.
56 percent said that cost would prevent them from considering products and services, but 88 percent felt there would be value in spreading out payments for the offered products and services on their electricity bill.
Another important motivator for customers–57 percent of them to be exact–is energy efficiency.
If utilities are going to sell energy adjacent products and services, then they need to “be the heart and not the cart.” How these products and services are positioned matters, and utilities need to bring customers peace of mind. Afterall, selling adjacent products and services makes customers’ lives better by helping families feel more comfortable and confident in their homes.
Utilities must go beyond being transactional–they need to show reliability and responsiveness, a willingness to reduce rates, provide good service, use the most up-to-date technology, offer recommendations for energy efficiency, and be involved with the community.
These basic fundamentals will go a long way toward effectively marketing and expanding revenue streams through these adjacent products and services.
Effective Marketing Solutions
Using data from prior purchases and studying customers’ propensity to buy, utilities can segment audiences and develop the right messages for each audience.
There are some customers, for example, who have already purchased services or products. Others are familiar with the services but haven’t yet taken the step toward buying. Some customers may have only heard about the services. Many others may not be aware of the services at all.
Tailored messages for each audience segment is about telling a story, not making a sale. Messaging around energy efficiency should combine the idea of cost savings with the idea of enhancing a customer’s overall quality of life. Utilities no longer should see themselves as just an electric utility company selling power – they are selling an energy experience.
Be proactive, not reactive. Customers are open to learning new ways to use energy, and to engage with their utilities at a less-transactional level.
Utilities should come to the foreground — be part of the community scene, share things about their good deeds, highlight employees, and be part of life outside the lines.
Finally, utilities should be much more than the meter and the bill — even if that means being more than the bill ON the bill. Use the bill as a means to communicate something more than just rates and business-as-usual. It’s one of the most tangible moments customers will have with their utility, so find a way to make the bill go further.
Stephanie Crockett is a senior vice president–managing director at Mower, an advertising, marketing and public relations agency. She is also the leader of the organization’s Energy + Sustainability Specialty. Pete Wiezalis is a senior manager of business development at Mower.