Four Things Every Utility Should Do Now
Shelton Stat of the Week
Only 13% of Americans think their utility is environmentally irresponsible (Energy Pulse 2018).
Utility Executives: Ride your environmental perception wave!
I’ve written a lot about the challenges utilities have in building loyalty with their customers. I’ve also written a lot about the deep challenges with getting Americans to truly embrace energy efficiency, and the challenges utilities have in getting their customers to see them as the go-to for products and services that can make their homes smarter and more energy efficient.
But one challenge utilities don’t have is this: Most utility customers actually think their utility is doing OK on the environment. Only 3% label their utility as very irresponsible, while 14% actually rate their utility as very responsible. A whopping 38% say their utility is somewhat responsible.
There’s way more good than bad in these numbers. And it’s a perception situation that utilities can and should build from.
Said another way: Utilities spend a lot of time trying to overcome negative perceptions, build loyalty, engage customers – it’s a lot of work. But here we have a belief that utilities can simply roll with.
Now, this doesn’t work for utilities that can’t make an authentic claim about their environmental responsibility. But for those of you who are down the path of environmental responsibility, here are four things you should do right away:
- Conduct some research with your customers to determine which of your environmental claims and products gets you the most perception lift. Again, your customers likely already think you’re doing OK; good market research can help you understand which actions and programs, when promoted, actually cause your customers to think you’re doing great. Shelton Group has done exactly that for one utility, and it boiled down to four programs/actions – four things the utility was already doing/offering that, once promoted, would generate sizable brand perception lift.
- Conduct some market simulation testing to understand what additional products and services would solidify your perception as an environmental leader AND your customers would actually buy from you at what price point against what imagined competitors. Shelton has also done this research with several utilities, and the clarity it offers about what to move forward with and what to leave on the drawing table is well worth the effort.
- Once you know what programs to offer and what efforts to promote, lay out your vision. Tell your customers in an inspiring way that you intend to lead the charge to a sustainable future – one where everyone has the energy they need, at a reasonable price, with zero impact on the environment. Tell them what you’re already doing (the existing actions and programs that tested well) and what you intend to do (the new programs that tested well).
- As you do this, reposition electricity. After years of telling people to use less of it, it’s gotten a bad rap. If we’re supposed to use less of it, there must be something wrong with it or bad about it – at least that’s the perception we’ve been creating for the last 20 years. Instead, talk about how electricity is or can be (depending on where you are on the path) the cleanest fuel we’ve got and we should absolutely be using it to power our cars and heat our homes, not just to illuminate our world. Shifting Americans to a near-term reality where they consume electricity instead of oil is great for the environment – and great for the utility business. Note that Shell is wisely already hedging their bets against this. Assuming that the world could go in an electrified direction, they’ve clearly made the decision to be an enabler of transportation, whether that transportation is fueled by oil or electricity (they’ve literally said they intend to be the world’s largest power company in 15 years). Utilities already own the electricity space; I say defend it and grow it and don’t let Big Oil push you out of your own ballpark.
Why does all of this matter? Americans are already putting companies into buckets: the Good List and the Bad List. Twenty-five percent can name – unaided – a brand they’ve avoided or purchased because of the environmental record of the manufacturer. And 41% of us want to be seen as someone who buys green products. Assuming those trend lines continue (and we are moving in an upward right direction on both fronts), Americans can either go, “I’ve checked one of my green boxes by buying electricity from my utility – they’re awesome!” or they’ll think, “Man, I’d better put some solar panels on my house or I’ll look like I don’t care.” Utility executives, which would you rather see happen?
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