At CHARGE 2016, Tomaz Oresic, Chairman of the board at Elektro Maribor, presented on the current outlook of the electricity supply value chain is going through major changes, with new players entering the market, shift of perception of electricity as a basic commodity and how the customer is increasingly being put at the very centre. These disruptive trends are changing the old electric utility business model with the result of an increasing number of utilities starting to pay more attention to branding.
Tomaz points out that utilities have been marketing an almost invisible product to an undefined customer with top-down communication strategies. These engagement strategies have often failed since the electricity suppliers have not walked the talk and due to mismatched communication.
Landsvirkjun is Iceland’s biggest power generation company, generating over 70% of electricity in the country. There has been a lot of changes in the Icelandic power market and Landsvirkjun has moved from focusing on low-cost electricity buyers market to a more balanced seller’s market, offering competitive prices.
The company offers 100% renewable power on the wholesale market, having only a few customers, meaning that their branding and image building is a bit different from other traditional power companies. It is, however, important for the largest power company in Iceland to deliver a clear message to their stakeholders (the company is owned by the Icelandic authorities) and their customers.
Landsvirkjun’s mission statement is:
Landsvirkjun’s role is to maximise the potential yield and value of the natural resources it has been entrusted with in a sustainable, responsible and efficient manner.
The role of the company has changed in the last years. Instead of focusing on growth and creating new jobs, its focus is today on more value creation than before. The energy transition and the way renewable resources have become more valuable for end consumers has enabled Landsvirkjun to focus more on the Green value proposition.
Effective product branding is about putting the right frame around your value proposition according to Mei Shibata, CEO of Essense Partners – an award-winning strategic marketing firm based in New York.
Mei uses the case of the electric cars to show how branding boils down to framing the value proposition. Despite the many advances the electric car has over the traditional combustion engine car, Mei’s research has shown that the biggest challenge facing the electric car is perceptional and related to the image the electric car has rather than technological, such as range, speed, charging time or the overall driving experience.
Mei points out that if you are not proactively doing your branding work, someone else is doing it for you and controlling the dialogue and setting the frame of reference for consumers.
Eneco was one of the first of the established energy utilities in the world to become fully renewable and became the frontrunner in the Dutch energy industry in the production of electricity from sustainable sources. Regine Alewijnse, Brand Manager of Eneco presented the brand’s story and the challenges that are facing truly renewable companies when many companies in the energy value chain present themselves as renewable when in fact, a majority of them are renewable only as far as the marketing message goes.
To further the point, Regine explained how sustainability can become more than a hollow marketing message, by making sustainability a valuable brand asset.
Eneco’s approach has not only been to offer renewable energy and offer customers a choice but also to enable customers the possibility to monitor their energy usage and helping them to cut down usage without noticing it by offering software that monitors and detects usage.
When preparing for his presentation in the track on the branding of sustainable energy, search engines turned Ayoola Brimmo to the CHARGE website. In the introduction of the presentation, he noted that this was the only place to discuss how to successfully brand sustainability.
A brand needs to take a look at the past to be able to build towards the future was the key point to take from Ayoola Brimmo’s lecture at CHARGE 2016. Ayoola works at the Nordic Innovation hub in Abu Dhabi and used the case of Dubai as an example of a city brand that has become more valuable due to a strategic brand building that focuses on the perception of luxury. Another example of a city brand that has been developed in the Emirates is Masdar City. When Dubai is the luxury city brand, Masdar takes footing as a luxury brand but goes further to differentiating itself by focusing on the sustainability of the city. Even though sustainability has become sort of a buzzword in the last decade, Masdar has yet to become a city brand with a worldwide recognition.
Bente Engesland, Senior VP of Corporate Communication at Statkraft from Norway, is fully aware of how fast times are changing in energy and how impactful the changing environment is for the energy space.
The traditional energy companies are faced with more disruptive changes in the next five years than in the preceding 50 years.
Bente mentioned three big factors having a lasting effect on the energy utilities:
- Population growth
- Environmental factors
- Technological factors
Although Statkraft has a strong tradition of producing green, sustainable energy, the company is facing similar challenges as every other energy producers around the world; communicating with key stakeholders and the public in an effective understandable manner.
The American retail electricity market is a mixed bag when it comes to the variety of companies and markets operating in the country. A majority of the states are yet to liberalise their markets while others have mature liberalised markets and others are in different stages of liberalisation.
KC Boyce is the product director at Market Strategies International. MSI has created a methodology to measure brand trust in the US electric market. At CHARGE 2016, KC went over the brand trust index and showed some examples of how electricity companies in the US have been able to establish more consumer trust.
Fintan Slye, CEO of the Irish Transmission System Operator Eirgrid, went over the case study of Eirgrid’s need of having a strong brand. Being a state-owned monopoly, Eirgrid is not at risk of losing customers or has any market share to gain – which is the second most common misconception of the role and importance of brands and branding. The biggest misconception is of course that people often mistake the creation of visual imagery such as the logo mark as being the only thing instead of one of many things branding is about.
As Mr. Slye told the audience at CHARGE 2016, the company was for months the topic of negative front page stories and tried to approach a public relation tasks with engineering solutions. The company was met with distrust and people did not know what Eirgrid was or what it did. The task ahead was to build trust by building a strong brand with people in the center.
Brand is critical to success and survival.
Fintan’s presentation shows an interesting challenge that many established utilities around the world are facing, lack of trust in a world that demands transparency.
Helle Andersen is the head of communication at Energinet.dk, the Danish TSO. Before joining Energinet, Helle worked for one of the most successful brands in terms of heritage, engaged customers, word of mouth marketing and brand recognition, not only in Denmark but in the world – LEGO.
Energinet had at the time not unveiled the company’s branding strategy meaning that Helle was not showcasing a visual identity or outreach programmes or a success story. Instead, she gave the audience in Reykjavik a rare peak into the engine room of a brand in development.
Helle raised the valid question why a TSO should even be considering branding and explained why Energinet was undergoing the company’s first corporate branding process.
As Jukka Ruusunen puts it: not many people connect customer centricity to a transmission company. Jukka is the CEO of Fingrid of Finland, a transmission company that not only creates a connection between generation and distribution but also had created a connection between transmission and customer centricity.
Having an entire track dedicated to the Transmission and Distribution operators at a branding conference seemed like the odd one out for many attendees. For the organizers of the conference, it was not by a chance; people working for regulated monopolies are fully aware of the importance of their brand as a strategic asset.
The times are changing, making it more important now than ever for the transmission system operators to become more customer centric. Distributed generation is part of it but also the public who is expecting power companies to become “less arrogant” as Mr. Ruusunen put it – preferring TSO’s to talk about customers rather than loads.
This is people business – not just building transmission lines
Branding is an important tool to use externally but any brand starts at the inside of any organization. At Fingrid, the importance of understanding people is becoming more and more relevant skill and has become one of the requirements for new employees. Instead of building silos with a marketing department full of people skills in one silo and the engineers with technical skills in another silo, Fingrid’s strategy is to have employees that have people with people skills and the technical knowledge of how the system works.
Fingrid was one of the finalists nominated for the CHARGE Energy Branding Awards.