Posted 2.18.15 by Todd Malinick, Managing Consultant
“Build it and they will come”
Energy efficiency program implementation is not always a Field of Dreams. We often act is if the energy efficiency programs we work with are in demand. However, the pathway to energy efficiency program participation often does not involve a customer seeking out a program – the reality is that participation in many programs occurs through contractors or trade allies. And as a matter of fact, notable proportions of customers are often not even aware they participated in a program!
This is inherently an issue of supply and demand. Utilities work hard to develop and supply programs that are effective at reducing overall energy consumption. But often, customers are not actively demanding these same programs, so getting customers to participate can be a challenge and overall program outcomes can be sub-optimal. This is because there is often a disconnect between supply and demand, but this disconnect can be overcome. Strategic marketing and promotional campaigns can do a lot to stimulate demand if they are well thought out and appeal to the right customers, and focus on the right wants and needs. As a starting point for ensuring program designers and implementers are considering the right factors, it is important to consider two questions:
Who is your program targeting? This is about understanding your target customer (and these are rarely all your customers). Decades of offering energy efficiency programs have shown that not all customers participate in programs. However, many customers participate repeatedly year-after-year. Thus, recruitment resources can be more efficiently spent focusing on the customers that are more likely to participate. Relatedly, one size does not fit all. Segmenting your customers and customizing messages and promotions targeted to the different segments is clearly a winning strategy. Though not common enough in the energy efficiency industry, segmentation is catching on and will most certainly be a foundational component of program designs in the future.
What do your customers value? Determining the right messaging is not always an easy and straightforward task. Customers participate in energy efficiency programs for a widerange of reasons: to save money, to improve equipment reliability, to reduce impacts on the environment, to preserve business operations, because their friends or family recommended it, the list goes on... Customers can effectively be drawn into programs by emphasizing the value propositions that resonate with their particular wants and needs. However, programs are often developed and implemented without in-depth insights into what the prospective participants really want – or what the program can really deliver.
Market research can help bridge the frequent chasm between supply and demand. Such research can help to develop a robust, well-informed marketing strategy that leverages customer insights to maximize the performance of energy efficiency programs. Also, in this era of the customer-oriented marketplace, working to ensure that your programs are meeting your customer wants and needs will help foster stronger customer engagement and improved customer satisfaction.