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Utilities: To Generate New Revenue, You Need a New Approach

It’s not news: utilities are in a transformation to determine what value they can bring to customers beyond power — but what that value is might be news to their customers.

If you’re a utility that’s been expanding your products and services into areas “outside the outlet,” chances are your customers have no idea. In a recent study conducted by Mower, we learned that 66% of customers are not aware of utilities offering products/services beyond basic energy. That’s more than half — and there’s even less awareness in the Midwest (where 76% of folks lack awareness).

What’s more, two-thirds of customers are into the idea of getting more than just the basics from their power company. Customers like the convenience of one company providing multiple services, especially if that company is dependable, reliable and trustworthy (and they believe utilities are) — so what’s a utility to do?

Get the word out.

It’s time to tap into new channels, create fresh messaging and let your customers know you’re more than just the meter. Social media has been a great way to keep customers apprised of outages and service updates, but could you be doing more on these platforms to let customers know you’re evolving from a commodity provider to an energy-services provider?

Based on our study and research with our own clients, we know there are three key areas where customers are open to the idea of having their utility play a bigger role in their lives.

1. Address the home perimeter.

Consider the areas on either side of the wall (and within the walls). Electrical wiring, windows, stray tree limbs that threaten your power lines, security systems — when it comes to “what more could the utility do?,” think about protection. When asked which services customers would consider buying from their utility, nearly 50% of respondents chose “electrical services, including repairs, inspections and wiring work.” It was the top answer across all regions. Those in the South were more likely to buy post lamps (34%, versus 21% in the Northeast, 16% in the Midwest and 16% in the West). Southerners were also more likely to consider tree trimming (29%) and security lighting (46%).

2. Act as a comfort concierge.

Products like Nest and the Google Home Hub are making “customized comfort” a mainstream idea, with solutions to easily adjust thermostats, ambient lighting and surveillance support. As a utility, consider helping your customers navigate these products and learn more about which ones would best suit their unique needs.

3. Become a purveyor of energy products.

Helping to educate and excite your customers about energy-efficient products is just step one. You can help customers understand these solutions, and then also give them access to products that help them create that customized, comfortable environment in their home. For example, FirstEnergy created Smartmart as a place that “brings energy to your family life, with products and services that help you live smarter, healthier and more energy-efficient.” FirstEnergy’s top-selling products are energy-efficient light bulbs, but our study shows there could be an appetite beyond the bulb. Across all regions, the top products/services that customers said they would consider buying from their electric utility were solar panels (discounts) at nearly 48%, followed by energy-efficiency products, such as appliances, HVAC and lighting rebates, at nearly 46%.

Stay true to savings.

Even as consumers are taking an interest in new products and services that nod to energy efficiency, remember that the primary motivator is still saving money. Messaging should clearly communicate the long-term benefit of using energy-efficient products and services in terms of cost savings, and be sensitive to the “sticker shock” that might turn some people off. Our study cited “cost too high” as the main deterrent across all regions that would prevent customers from considering products and services offered by their utility.

To learn about some of the key findings from our research, download our infographic.