Why did we do it this way?
Somewhere long ago and far away, someone decided that the value proposition for energy efficiency was saving money.
“Everybody loves to save money,” these energy efficiency marketers likely thought, “and since efficient products use less energy than conventional ones, we should lead with it!” You all know the drill, though. Most Americans don’t actually see the savings.
Utility rates go up sometimes and negate the savings, bad behavior happens (they use the efficient products as a reason to behave in inefficient ways) and/or extreme weather happens and utility bills appear higher, not lower, than they did before the efficient products were purchased.
And, in truth, for most folks to see significant savings, they’d have to really spend some money for a deep retrofit. Although the monthly utility bill savings may be noticeable, the cash outlay upfront would be so high that it would take years for the savings to offset the investment.
Thus, the “save money” promise is rarely delivered on. And Americans have noticed.
In our 2016 Energy Pulse study, coming out early next year, it’s clear that Americans aren’t making much progress toward energy efficiency. In fact, over the past four years, likelihood to do (and actually doing) all the energy efficiency measures we track has flatlined. Tired old messaging about savings has lost its potency, if it ever had any to begin with.
Now, to give energy efficiency marketers a little slack: it appears on the surface that Americans are motivated primarily by savings and lower bills. Their top energy-related concern (by far) is the cost of it, and that’s true no matter whether you’re talking to Southerners or Westerners, Millennials or Seniors:
Which of these is your biggest energy concern?
36%: My ability to pay for energy
26%: The environmental impact of our energy use
23%: Dependence on foreign countries for energy, rather than tapping our own oil and natural gas resources
15%: Using up our energy resources at the expense of future generations
Also, when you ask them why they make or plan to make energy-efficient home improvements, their answer is always, always, always savings. And it’s never even close. This year, 59% cited savings as their top reason; the second-place answer was comfort at 35%.
But saving money doesn’t move consumers to act. And, again, in most cases people don’t really see the savings, so their experience of energy efficiency is the opposite of the promise we make to them to entice them to buy the efficient products in the first place.
Here’s the unfortunate truth: savings works as an emotional driver only when people are fearful. As we look at trends over the last 11 years in our Energy Pulse data, a faltering economy has been the main driver of energy-efficient home improvements. When times are good, the often minimal savings that energy efficiency brings are perceived as not worth the effort; even the catastrophic weather events of the past few years haven’t pushed Americans to take action.
Also, by leading with savings, we trigger left brain ROI calculations and defense mechanisms. Twenty-seven percent of Americans tell us they’re barely making ends meet, and another 25% say they flat-out can’t justify the up-front expense of energy efficiency. So by leading with savings, we trigger folks to think about the upfront cost, and they instantly conclude they can’t afford it.
Yet we all buy things we don’t actually need, that offer no financial return whatsoever, all the time. We buy electronic gadgets for the cool factor, for convenience or entertainment value, we might splurge on an outfit or a nice dinner as a way to soothe some greater worry or just to celebrate life. We buy products for many reasons … and there are many other reasons to purchase energy efficiency products that have nothing to do with saving money.
Those are the reasons we need to be tapping into. Savings should be the secondary message, the justifier of the expense. But the reason to be energy efficient should be about satisfying a greater need, a deeper driver. Once we get that messaging right, we’ll start to get some real traction in the energy efficiency market.