Building a Better Relationship: How Utilities Can Engage Small and Medium Biz

Small and medium-sized businesses (SMBs) make up over 80 percent of businesses in the U.S. and as much as 25 percent of the load in a typical utility, making them a vital segment to reach. They are the most visible part of local communities, and their opinions influence not only JD Power scores for business, but the overall relationship communities have with local utilities.

While utilities understand their importance, SMBs can often be hard to reach and expensive to serve. SMBs’ needs and expectations continue to evolve with digitization and new energy options such as DERs, competitive supply, energy efficiency and more complex rate structures. Not only do SMBs have diverse and varying needs, they have budgetary constraints and limited personnel resources. Historically, tactical blockers have emerged during utilities’ SMB-focused initiatives – for example, the lack of availability of business data, limited understanding of the differences in meters and buildings, and incomplete contact information – that choke the scale or success of efforts.

But the times, they are a-changin’. The importance of reaching the SMB sector combined with SMBs looking for ways to boost their bottom line opens a window of opportunity that leading utilities are already moving on. Also, the success of customer engagement efforts in the residential sector and newly available data analytics that help overcome the aforementioned historical blockers mean utilities have cause to expect success – if they take the right course of action to prove their value.

Based on FirstFuel’s work with dozens of utilities in the U.S. and Europe, and on conversations with utility executives on best practices when working with SMBs, three common themes have emerged.

Make personal connections

Currently, many SMBs feel that they aren’t getting utilities’ love and attention. In fact, according to Accenture, only 35 percent of SMBs believe their utility offers them targeted solutions. Utilities can change this—by analyzing the data they already have on customer usage habits and trends by industry, size and weather—to uncover insights into SMBs’ energy profiles, allowing them to better understand how each customer can make changes that will help them save on energy.

Pacific Gas and Electric Company (PG&E) leveraged their business customer data to build a segmentation program that is enabling PG&E to build deeper, more meaningful relationships with their business customers. “We segment our SMB customers on three key dimensions—what kind of business they’re in, their attitude towards energy and their attitude towards their utility. In addition, we use our data about their energy use and needs to make sure that not only each segment, but each individual customer is getting the right message about the right offers at the right time. For SMBs, their businesses are more than just work – it’s their livelihood. We want to make sure they know we’re there every step of the way to serve as a trusted advisor as they navigate the ups and downs of business ownership,” said Jamie Chesler, senior manager of B2B marketing at PG&E.

Demonstrate an understanding of their pain points

SMB owners are personally invested in their business, and saving money is a top priority,  but many feel they lack control over their energy costs. PG&E’s business customer segmentation program has identified three primary factors why SMBs feel this way: no control over energy supplier; renting (as opposed to owning) their space; and lack of capital for retrofits. By acknowledging these challenges  and providing customized solutions that save time and money, utilities can show they understand customer needs and are doing their part to help them succeed.

In small businesses, budgetary restrictions often result in lean teams that don’t have the capacity to dedicate significant resources to energy management. By providing SMBs with the tools and advice they need to cut costs—and by using terminology that won’t make customers feel like they need to learn a whole new language—utilities can improve customer loyalty and deliver measurable improvements in business customer satisfaction. As importantly, energy providers can provide SMBs with better visibility; for example, restricting offers to only ones that are relevant to the customer and providing initial estimates of their expected costs and savings. This will help them answer hard questions like “what does this mean for me?” without using their limited time resource.

Re-evaluate communication

Even utilities that have taken these first two steps will come to a dead end if they can’t effectively connect to customers. The good news is that many of the communications and engagement principles that have been successful in the residential segment translate well to SMBs. Utilities should take advantage of any and all opportunities (such as outages, when there’s an influx of inbound communication) to capture up-to-date contact information. From there, they can build a strong rapport with SMB customers by proactively providing helpful information and cost-saving tips on a regular basis.

For example, utilities can use customer meter data and analytics to trigger push notifications alerting customers about an unusually high or low bill—information that is particularly valuable for small businesses looking for more predictability of their tight finances. These proactive alerts open the lines of communication, enabling utilities to deliver value beyond the monthly bill and promote new energy efficiency products and services. With the lines of communication open, SMBs will also be more open to in-person visits, further strengthening relationships.

While at first it may seem daunting to meet the varied needs of SMBs, the window is opening for utilities to cost-effectively increase SMB customer engagement and create more personal and impactful experiences. By leveraging the information they already have, understanding and addressing SMBs’ limitations and establishing open and meaningful communications, utilities can improve and protect their relationships with critical SMB customers.

 About the author: Indran Ratnathicam is vice president, marketing and strategy, for FirstFuel Software.


Previous articleAvangrid buys stake in Massachusetts offshore wind project
Next articleICF wins $13.6 million energy efficiency contract from Con Edison
The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at

No posts to display