How can you sell to a business customer without understanding their business? Engerati discovers how data insights can help.
In a world of shrinking margins from electrons due to increased competition and increased supply from distributed energy resources like solar and microgrids, business energy customers represent a large opportunity area for energy suppliers looking to grow non-commodity revenues.
In the US, non-residential customers represent approximately 60% of a utilities’ electricity load, according to data from the US Energy Information Administration.
And they’re big energy spenders. In the UK, energy regulator Ofgem found that micro and small businesses spend 14% of all operating costs on electricity and 11% on gas, according to a September 2015 survey.
Taking the right approach to business energy customers and getting them engaged with your energy company’s products and services can be challenging, however.
FirstFuel Software is a US technology company that provides a business customer engagement platform to energy providers in North America and Europe.
Indran Ratnathicam, Vice President, Marketing & Strategy, told Engerati that business energy customers are a complex segment to engage because of the diverse nature of their facility types and business activities.
Ratnathicam explains that a petrol station will have different energy consumption patterns and needs than a school. And even within the same business type, there may be variances in operational hours and equipment use that create differences in each business’ approach to energy management.
“So each customer has unique energy usage and individual needs and, therefore, a unique set of data,” says Ratnathicam.
He explains: “At the moment, utilities are not taking full advantage of this data. They aren’t doing much segmentation of their business customer base due to the effort and expense involved.
“They wish they had a clearer picture of how different customer types are using energy, but don’t have the resources or budget to acquire this information.”
Energy providers risk losing credibility if they attempt to gather this information from customers when they call in. “The customer will be wondering ‘why don’t they know anything about me’?” says Ratnathicam.
In order to build a positive relationship with their small- and medium-sized business customers, utilities must first understand who their customers are, and then be able to tailor their communications based on that knowledge.
Once they know who their customers are, energy providers can provide customers with business-specific insights, such as recommending a bakery replace outdated kitchen equipment. Opening the door for two-way conversation will help utilities build better business consumer engagement over the long term.
Data is the key building block in creating a personalised relationship with a business energy customer, says Ratnathicam.
The first step he says is to clean up the basic data the energy provider already has, such as how much energy the customer uses, their name and address.
Often business customers will have multiple energy meters in their building. So, FirstFuel uses data analytics to map individual meters back to the whole building so the utility can begin to build a more holistic picture of their customer’s business.
Where available, public records and other databases add more flesh to the bones of the customer profile by providing information such as the size of the facility and what kind of business the customer is running.
FirstFuel then layers in additional data sources, such as weather and energy benchmarking data, to create a complete customer profile.
James Miller, Principal, Customer Strategy and Data Analytics at research and consultancy company Delta-EE, agrees that profiling is an essential step before trying to sell anything to business customers.
He says: “You may know that they consume energy in a certain way but do you know what type of businesses they are?”
Miller, who has a background in retail customer engagement, describes the process as relatively straightforward to determine the kind of industry sector the business is in as well as the size of the company in terms of number of employees and turnover.
Then, FirstFuel uses deep data analysis to mine the individual data stream of each business customer.
The building ‘facts’ gathered from this analysis are then used with FirstFuel’s database of 4m business customer meters and scalable analytics engine to identify similarities in consumption and make customised recommendations on how each business can optimise its energy use.
“The combination of data from our big data analytics helps us figure out what kind of building the customer is in and how much they might be spending on things like lighting and HVAC,” says Ratnathicam.
FirstFuel’s business customer engagement platform uses this data to personalise insights on how the customer uses energy, and recommendations on how to optimise usage.
The energy provider can then share this information with the business customer through any of their communication channels including digital, sales, or customer service. “We help utilities to leverage the data they already have on every building to build more meaningful relationships with business customers.”
Once utilities have detailed personalised insights for each customer, they must overcome the hurdle of using the insights to build long-term relationships with their business customers.
Within a business, the people and resources assigned to look after energy management vary widely, ranging from dedicated energy managers to small business owners; as a result, the level of understanding and capacity to engage with an energy supplier also varies.
To overcome this barrier, the utility needs to find the best mix of communication methods and channels to engage each individual customer.
Ratnathicam explains: “Digital and email are less expensive and in high demand from today’s business customer. Energy suppliers need to consider how to drive more traffic online, which will reduce the number of customers ringing the call centre, and improve the level of service customer that call centre representatives are able to give to those customers who do call. ”
He emphasises that to be successful in leveraging data, energy companies need to find cost effective ways to go deeper into their customer base and deliver personalised insights to their entire business customer segment.
Ratnathicam concludes: “Business customer insights will enable energy providers to deliver personalised customer experiences at scale – meeting increasing customer expectations, and building stronger, long-term relationships with their business customers.”
Indran Ratnathicam and James Miller will be speaking on a live energy webinar ‘Satisfying business customers with a multi-channel approach to engagement’ on 18 May.