New research from the Smart Grid Consumer Collaborative indicates that consumer segmentation can enhance customer empowerment strategies.
The energy transformation demands that consumers become more empowered – at some level at least – to understand and manage their energy use. With the wider deployment of smart metering, utilities have been seeking to build closer relationships with customers and they are delivering strategies such as personalised billing and energy reports. Alongside them a host of third parties are bringing new products and services to engage consumers.
But is the empowerment happening?
According to the Smart Grid Consumer Collaborative (SGCC), based on its latest research, in the US at least it is. The organization finds that overall consumer awareness is at an all-time high with more than half of consumers aware of various smart grid-enabled services and technologies, particularly of smart homes, rooftop solar and device remote control. There is also a high level of interest, particularly of smart appliances and the opportunity for peak time savings.
The only technology of those examined of which there is little awareness and interest is onsite power storage, which at this stage is still expensive and therefore nascent. Of note also is that while more than half of consumers are aware of prepaid billing, interest in it is limited to just over a quarter.
One of the most significant findings of the study, with implications for tailoring customer engagement and service strategies, is that awareness and interest levels are independent of whether the utility has deployed a smart grid and instead vary by consumer type.
The research was conducted among residents in 16 states intended to be representative, both ‘advanced’ states in which AMI has been deployed statewide for several years including California, Texas, Maryland, etc., and ‘control’ states. Overall little differences were found in the awareness and interest levels between the advanced and control states.
However, when segmented by consumer type there are large differences with the greatest levels of both awareness and interest shown by the so-called ‘Green champions’ and the ‘Savings seekers’, i.e. respectively those who regard smart technologies as a part of their lifestyle and those who look to smart energy programmes to save them money.
Unsurprisingly the ‘Status quo’ consumers, i.e. those who want to be left alone – and apparently more likely to be middle age, non-college educated low income renters living in non-single family dwellings – showed both the lowest awareness and interest levels.
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The research found that the greatest motivations for smart grid technology adoption were bill reduction and the greater convenience offered. The greatest barriers were the purchase costs and control of the home by the utility.
Smart thermostat programmes were also found to be appealing to more than half of consumers, regardless of the incentive amount, and more than half of consumers were interested in time varying rates. These in turn suggest that such programmes may be a good first step to engage consumers, while time varying rate options offer potential as a load shifting tool for utilities and can further increase consumer interest and participation.
The study is the latest in an ongoing series by the SGCC which has gathered a significant amount of data and insights on consumers in the US.
In a press briefing, SGCC president and CEO Patty Durand said the study had thrown up some surprises, such as the consumer segmented rather than geographic differences. “What this suggests is that while the advanced states are more advanced in terms of their technology, the entire country benefits from the technology advances that are being rolled out on a state by state basis.”
Overall, the study clearly highlights a breadth of opportunities available to increase consumer engagement and satisfaction for both energy providers and technology vendors. Though the concept of segmentation isn’t new - Opower has long included it in its offerings, for example - how it is done is clearly important.
“Aligning offerings with the varied consumer interests and concerns discussed throughout this report, the smart grid industry has the potential to engage a broader spectrum of consumers than currently done to date,” the report concludes.