Billing Id8826524 C2 A9 Tommaso79 Dreamstime com

How to Engage Customers in 2020

June 19, 2020
Providing consumers with reliable and clear information on relevant offerings is foundational for developing satisfied and engaged consumers.

When the Smart Energy Consumer Collaborative (SECC) was founded a decade ago by a diverse group of energy industry stakeholders, providers typically viewed residential customers on the other end of the meter as “ratepayers” or “load.” While the industry has become notably more customer-centric since then, customers’ expectations for their providers remain high, and their needs today are many.

In 2019, SECC sought to better understand these expectations by completing four research reports on key industry topics. These included deep dives into time-varying electric rates and distributed energy resources (DERs). SECC’s “2020 State of the Consumer” report synthesized the findings of SECC’s 2019 research with a U.S. Department of Energy report on advanced metering infrastructure and insights from SECC’s case studies on programs from NB Power, the Sacramento Municipal Utility District, AEP Ohio and other providers.

SECC’s 2019 research reached more than 7,500 residential customers in the U.S. and Canada. Here are three key themes on the needs of consumers today and how electricity providers can more effectively meet them:

1) Consumers are more ready than ever to engage in energy programs and services: Several SECC studies from 2019 indicate that interest in energy issues and programs is continuing to grow. The study on rate design, for example, found that a majority of consumers (57%) prefer a time-varying rate over a traditional flat rate when presented with options. More eco-conscious and tech-savvy customer segments exhibit the highest levels of preference at 68% and 62%; however, less engaged segments still demonstrated a preference for time-varying rates at surprisingly high levels (46%).

SECC’s updated market segmentation from the “Consumer Pulse and Market Segmentation — Wave 7” study provides another revealing data point on consumers’ interests. In this segmentation, the Green Innovators and Tech-savvy Protégés have characteristics similar to the Green Champions segment from the previous framework. While the Green Champions segment accounted for only 30% of consumers, the two new segments represent nearly half of all consumers. The Tech-savvy Protégé segment scores right behind Green Innovators in metrics like the importance of environmental benefits, demonstrating that sustainability has become more widespread in today’s society.

Yet, while consumer interest in smart energy technologies and programs has reached an unprecedented level, participation still lags in many cases, likely due to several prominent hurdles, which we’ll explore next.

2) Consumer expectations are shaping the utility of the future: Today’s energy consumers are asking for more from their electricity providers and other industry stakeholders — more options, more personalization and more innovation. For consumers of all generations and market segments, technology is a core component of daily life, and the experiences that consumers have with Amazon, financial companies, Lyft and other companies are affecting their expectations for energy services. These expectations are even higher for young consumers, according to our “Spotlight on Millennials” report.

In response to one of our consumer surveys, a respondent summed these expectations up succinctly, “The best service that I get anywhere is the service I expect everywhere.” If consumers are getting good service from one industry, that raises the bar for what they expect from all other service providers — regardless of industry. Not only do today’s consumers want smart energy programs and technologies, including DERs, smart home devices, time-varying rate plans and energy efficiency options, they want these offerings to provide a customer experience that’s digital, easy, convenient and on their terms.

3) Effective education remains a necessity to increase consumer engagement: One of the most important, consistent findings from SECC’s consumer research is the need for more customer education and outreach. The “2020 State of the Consumer” report points to education as a requirement to increase energy engagement and address the needs of today’s consumers.

Across SECC’s 2019 research, consumers report low awareness and understanding on energy issues, programs and services — from energy efficiency to time-varying rates to renewable energy. The study on rate design, for example, demonstrated that few consumers are able to accurately identify their current rate plan, and awareness of alternative rates, such as time-of-use rates, real-time pricing and variable peak pricing, was generally low. Once consumers were educated on these rates, however, the majority preferred them.

Today’s consumers are often unaware of the options available to them from electricity providers, and if they are aware, they often struggle finding information that’s relevant to them. Providing consumers with reliable and clear information on relevant offerings is foundational for developing satisfied and engaged consumers.

While many challenges lie ahead as the COVID-19 pandemic impacts consumers’ lives, it remains an exciting time in the energy industry; utilities across the U.S. are working toward decarbonization targets; and technologies like smart meters, smart home devices and DERs continue to mature and proliferate. However, as shown in the State of the Consumer report, industry stakeholders still have a lot of work to do to engage consumers in this smarter, cleaner energy future. Consumers need access to solutions that fit their daily needs and match their expectations and need information that relays the benefits of participation in an easy-to-understand manner.

Voice your opinion!

To join the conversation, and become an exclusive member of T&D World, create an account today!