Tag Archives: conference

How to be the green brand in a 100% renewable market

Iceland is one of the few countries in the world that can boast of having all of its energy generated from 100% renewable and sustainable sources. Electricity is generated from hydro dams and geothermal plants and almost all hot water comes from geothermal sources.

Green energy has been the most popular differentiation tool for retailers in liberated markets for the last decades. For a retailer in Iceland it can be a challenge to be perceived as the green brand. Áslaug Thelma Einarsdóttir, managing director of marketing at ON Energy gave insights on how the company met the challenge of rebranding and positioning itself as the leading sustainable brand.

The Role of Branding in the Retail Energy Sector

One of the more interesting energy brands to hit the retail energy market in Germany is Shell PrivatEnergie. The company behind the brand is the UK’s largest challenger to the Big Six, First Utility. First Utility entered the market utilizing one of the largest known brands in the energy world, Shell – with over 100 years of brand recognition in the German market and around 2.000 retail outlets. The German market has over 1.400 electricity retailers and is one of the most active energy markets in the world.

Maik Neubauer, CEO of First Utility in Germany is responsible for the Shell PrivatEnergie offering and participated in the Understanding the Energy Consumer track of the conference. He went over the Shell case; which elements of the brands were transferred to the electric energy brand and how to create a credible quality energy brand that is trusted by the energy consumer.

 

Transforming from Utility to Energy Brand

Dr. Friðrik Larsen (FL), of LarsEn Energy Branding and KC Boyce (KCB) of Market Strategies International sat down for a chat on Energy Branding and marketing efforts of utilities. This is an excerpt, the article originally appeared on the Market Strategies International Blog. Both Friðrik and KC will be delivering keynote addresses at CHARGE Energy Branding Conference in Reykjavik, Iceland next September.

(KCB) In the US, we’ve identified six factors that drive consumers’ brand trust: customer focus, company reputation & advocacy, communication effectiveness, reliable quality, environmental performance and community outreach. How does this compare to what you see elsewhere in the world?

(FL) These factors are similar to my own qualitative research findings done throughout Europe, both in areas with a long history of liberalized energy markets as well as newly or soon-to-be deregulated eastern European markets. What differs between countries is what consumers expect from the utilities and consumers’ varied understanding of the underlying concepts. For example, consumers in Iceland are used to hydropower and consider nuclear to be a dirty energy source. However, Eastern European countries—that only know dirty coal (in terms of everything in the country being covered in a layer of ash)—consider nuclear to be a green source of energy.

(KCB) What can utilities do to improve their company’s reputation among consumers?

Utilities need a more brand-minded, customer-centric strategy. That can prove to be difficult, especially for bigger utilities, but it’s very important to be honest and credible in communications. For instance, oftentimes a utility tries to make connections to certain imagery in the consumers’ mind, but the consumer is given no choice to understand why that utility should be connected to that imagery.

Here‘s an example: Before rebranding in 2008, British Gas was losing 40,000 electricity customers each month. This old behemoth identified its strengths in the consumers‘ minds as well as its faults inside the organization. After a 2009 rebranding, British Gas saw lower churn rates among existing customers and was attracting new customers. The brand became more resilient towards bad PR as well. This was the result of increased customer affinity, positive perception and improved attitudes towards the brand. It is a really interesting market, and I find it fascinating to watch that energy branding ecosystem develop, with established players trying to evolve and newcomers trying new approaches to become dominant.

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This is an excerpt, For the full article see the original post on the MSI blog 

Just like branding a box of soap

Some say that energy can’t be differentiated and it can’t be branded since it is just an intangible commodity. An obvious example of an intangible commodity branding is the telecoms. But in many ways branding and marketing energy is not that much different from branding other household items such as soap. It is all about creating connections in the mind of the consumer.

Electricity is an intangible product meaning that you are not selling or marketing a product that you can hold and feel in your hands like soap. But the job of the utility is to make electricity more tangible by creating connections in the mind of the consumer. Electricity can’t smell like strawberries or Alpine spring. The soap doesn’t really smell like a real fruit or Alpine spring but for a brief moment when you wash your hands you take a short trip to the Alps in the springtime or remember when you open a box of ripe berries.

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By connecting a brand with positive sensation in the mind of the consumer, the brand creates value for the customer. The same could be done with electricity just as soap. Electricity is in fact more exciting than most commodities.

Most commodities are in fact rather unsexy when they are not branded. The sweatsuit and sneakers overcome a lot of negative connections when branded. These commodities are not connected to the sweat and smell of the athlete when they have been branded as Nike.

Established utilities often have a lot of negative connections to their brands to overcome. The first step is to identify what emotions consumers connect to their brands and sort out the negative from the positive and figure out which negative emotions can be turned to positive ones. Then the brand re-building can take place.

The possibilities of branded energy

The possibilities of branding within the energy sector are enormous. Not only for retail but other aspects as the origin of energy, the natural monopoly as well as using the source of energy to create brand value for other products. Here are few of the areas we will cover in September in Iceland at CHARGE – The World’s First Energy Branding Conference.

From the merchant to the aisles of the supermarket

While most brands we know today used to be mere commodities sold by the pound over the counter by the merchant – electricity is still mostly sold by the kilowatt-hour by the utility. To understand why branding is a necessary step in evolution in energy, it is important to look first at branding in the general context. Though the basics of branding are the same for electricity and bananas, there are key differences needed to approach the consumer.

Active listening

A brand is never more powerful than its ability to communicate its meaning to consumers and decipher communication from consumers. Being able to talk to the consumer has been considered easier with new mediums and social media popping up everywhere but the task to deliver a relevant message that resonates above all the clutter has become more difficult. In a similar manner it has become easier to hear multiple stakeholders voices but the task of engaging in a relevant conversation can be a tricky task for energy companies.

Commodity and monopoly branding

Creative thinking can create engagement for consumer for once considered mundane commodities such as salt and water and how services such as telecommunications became the hottest thing since sliced bread. Branding applies to the natural monopolies as well. With the rise of the prosumer, the monopolies are not only transmitting to the end consumer but receiving from them as well and this two way relationship requires two way communication as well.

Energy Marketing requires a brand

For any energy marketing effort to be fruitful, a powerful brand is needed as foundation for efficiency. A brand that has full organizational support is proven to spill over to all aspects of the operation, be it payroll, the service center or attracting the most qualified candidates for open positions. Efficiency in energy can never be fully realized without a brand mentality.

The origin effect

Soon, electricity will be known for its origins, a city or province or even a country will give a stamp of quality for the energy produced there. How can the origin of electricity create more value for consumers?

Updating the utility

While most retail industries went through radical transformations in the last century, electricity is still mostly sold and delivered today as it was when Edison lit up the world. Groceries, media, music and airlines have all been disrupted and distributed in radical new ways with advances and innovation in technology and updated business models.

The utility of the 1900’s is still the dominant business model but will soon be run over by the energy brand of the 21st century. The energy brands are not only updating the business model according to advances in technology but are connecting to the minds and hearts of the customers in ways the utilities have not been able to think of.