‘Tis the season when your loved ones ask what you need (or, in my case, your kids proclaim what they want)! In the spirit of gift-giving, we penned a letter to Energy Santa with our “wish list” of energy-related products and services. The ideas are based on results from our 2016 Utility Trusted Brand & Customer Engagement™ study, and although they apply to energy consumers in general, we’re focusing on the group nearly every company hopes Santa will deliver—Millennials.
The Relevance of Millennials to the “Utility of the Future”
Many of our energy utility clients are making plans to better position themselves as a “utility of the future” by offering new products and services. To this end, it is critically important that they identify and segment customers to ensure they’re offering the right products to the right people at the right time. This is especially true of Millennials, a group of consumers 75 million strong nationally, who are already spending billions annually and have no compunction about putting companies on their own Naughty List.
As I have written in an earlier blog post, Millennials are the first generation to have grown up entirely with the internet. They are content junkies and smartphone aficionados. From a shopping behavior standpoint, our research reveals that Millennials:
- Prefer to shop online or via mobile versus visiting a store. (For context, US consumers spent more than $5 billion online on Thanksgiving and Black Friday this year, an 18% increase over 2015. And 80% of Millennials made purchases over the holiday weekend.)
- Are among the first to adopt a new product.
- Feel that owning the latest product design or technology is important.
If you look across the business landscape, more and more companies are structuring their products and services, marketing messages and sales channels to meet these criteria. However, the energy industry has largely ignored Millennials. With technology-focused companies like Google, Apple and Tesla/SolarCity charging into the landscape with cool, smart and efficient energy-related products and services, it presents a serious challenge. But it also presents a serious opportunity for traditional energy utility companies. Hence our letter:
Dear Energy Santa,
Thank you for a good year!
We are enjoying doing business with you more than ever. Your reliability and customer service have been improving, and you are doing a good job providing the basics that you promise. We are becoming more satisfied in our experiences with you than we ever have before.
The world is really changing though, and what we expect to receive from you and other companies is changing, too. For Christmas this year, we would like you to please consider the following three wishes so you can build lasting, trusting relationships with us and, in turn, we can become more engaged with you:
- Help us save more energy and money!
- Make it even easier for us to interact with you!
- Offer more useful, cool and smart technology!
WISH #1: Help us save more energy and money!
Our research suggests that there is great interest among all customer segments nationally when it comes to consumption management-related products or services, including rebates and discounts on energy-efficient light bulbs, energy-efficient appliances, programmable thermostats and the like. Not surprisingly though, Millennials show an even greater interest in having access to online tools and energy audits to help them better manage and conserve energy.
WISH #2: Make it even easier for us to interact with you!
Online access to customer account information is generally considered a need-to-have versus a want-to-have option. In general, consumer demand suggests that utilities should expect to increase customer engagement across all digital platforms—especially mobile apps, social media and utility websites—and even more so among Millennials.
WISH #3: Offer more useful, cool and smart technology!
From all accounts, consumer demand for new technologies and distributed energy resources is transforming the energy sector, but our research suggests there is a lot of work to do to meet this demand. Nationally, we are seeing moderate interest in things like back-up power generation, Wi-Fi/smart thermostats, community solar, battery storage and home area networks, though again we see that Millennials tend to have a significantly higher level of interest in these emerging technologies.
Is the Energy Sector on the Nice List?
While having market disruptors playing in the same sandbox is certainly a threat, traditional energy utilities are well-positioned to capitalize on the customer-facing benefits of their investments in smart grid, smart meters and the “Internet of Things,” according to The New Energy Consumer: Unleashing Business Value in a Digital World. After specialist providers, utilities are consumers’ preferred choice for connected products and services. As utilities offer more connected devices, they are going to be able to serve customers better and increase customer engagement and satisfaction. Having a strong company brand becomes of even greater importance at this stage as our research shows that product and service adoption increases with brand trust.
We rarely get everything we want. In this case, though, energy utilities are making strides to advance technology, and it is starting to pay dividends with customers. An increase in mobile offerings usage measured in 2016 has helped increase the average brand trust scores in our study from 688 in 2015 to 693 in 2016 and reflects the impact utilities can enjoy when they provide more compelling, digital-based products and services. With that said, the research also shows that there is still significant growth potential.
Make a New Year’s Resolution
Market Strategies is uniquely qualified to help energy utilities think through current and future challenges. Our experienced team of experts can help you develop deeper insights to understand how your company can improve customer engagement, brand trust, satisfaction and brand value. In addition, we can leverage our expertise in the Technology and Consumer & Retail sectors to identify which new products and services consumers want from your company.