Tag Archives: utilities

Challenges of a decentralised energy market

The energy industry is changing faster now than it has ever before. These changes can in many cases be traced to the focus on renewable energy sources and energy decentralisation. With pressure from lawmakers, energy companies have been changing their energy mix to increase the use of renewable or sustainable energy sources.

Renewable energy branding has changed – it is becoming less of a differentiation for an energy company to offer a high percentage of renewable energy to customers. What has also changed is what customers expect to see from their energy companies in terms of customer service and engagement. It is more important now than ever before for energy market segmentation of customers – especially with more and more consumers in the energy market becoming prosumers. This is why energy companies have a focus on renewable energy and customer relations.

The most effective ways of communicating with energy consumers can be through content marketing, storytelling, advertising or direct contact but it the most important and effective way for communications to become successful is by building a strong brand with a coherent voice as a trusted source of information. People connect to brands.

Energy decentralisation can have two meanings but both of those meanings have had an impact on the energy sector. The decentralisation of the market in general, or deregulation or liberalisation, has meant that some market territories are no longer controlled by a monopoly which produces, transmits, distributes and sells electricity to an end consumer. Markets have been changed in order to increase competition in the retail and generation areas.

This has created new challenges for energy companies. When the consumer has a choice – he is more likely to choose the brand which speaks his language and connects to him in more ways than just supplying energy to the sockets.  This is not only causing a change in the retail sector – new brands that have been established around the transmission part and the distribution parts of the power systems have become more effective in brand-building and communicating to customers and other stakeholders. They have found out that branding is not only a proven way to communicate with the public but also to help people inside the organisations to communicate with each other. Branding has proven to be a valuable tool in breaking the silo mentality within organisations.

Energy decentralisation can also refer to new technologies enabling consumers to produce their own energy. Instead of energy coming from a centralised energy plant, it is all the sudden flowing from the rooftops of homes and small-scale windmills at farms. This addition to the power mix is not only changing the way people think of energy by bringing the production closer to home but is also changing the way energy companies are approaching the market with new strategies.

Electricity brands, in retail, transmission and distribution have had to find new ways to engage with those customers who are able to get energy off-grid. These customers are not only self-sufficient with their energy usage but are also selling power to the grid. This means a whole new means of communications. The average consumer is not an expert in terms familiar to people in the energy space – there is a need for a common language for energy companies and consumers to have their engagements in.

Energy company branding is an important topic for the changing times in the energy sector. Energy utilities are aware of the fact that they are not dealing with meter points but people of flesh and blood that need a deeper, more emotional connection than before.

 

Next level Energy Branding

The best brands in the energy sector work hard, deliver superior value, look outside the energy space, segment their customers, are data driven and are on a mission of changing the status quo.

By reviewing the branding case studies from the World’s Best Energy Brands we have learned a great deal about how the best energy brands in the world view themselves and how energy company branding can go to the next level. There is a common thread among the best energy brands in the world. It does not only apply to the competitive retail sector – it also applies to the regulated energy sectors both in retail, transmission of electricity, distribution of electricity and it should apply to B2B energy retail companies as well as generation companies.

There are no shortcuts towards a superior brand

People often wonder if there is a good life-hack or a shortcut to achievement. So, is there a good life-hack for creating a good brand in the energy sector? The short answer is: No – there are no shortcuts. Creating a good energy brand takes a great deal of effort. Even if you know the secret to creating the very best power brand in the world and even if you were born with the secret to energy marketing in your head – creating, implementing and running an effective brand in the energy sector is still hard work.

 

The best Energy Brands offer something else than energy

They offer an experience. They have a simple message about the benefit they offer that no one else offers. And the benefit is usually not the price or being able to deliver electricity on time. It’s usually a feeling in the mind of the consumer that they own. Apple and Nike are well-known branding and marketing reference point clichés for a reason. They own a share of the consumer’s mind – and that is what you need to own a share of the market.

They look outside the energy box

The best brands are not focused on the next door utility neighbour and try to copy their best practices. Although many brands in the global energy market are doing great things branding vice, the best brands in the world are not found in the energy space. You should look outside the box and identify who is the best in the world and learn from them and apply it to the energy sector and your market. Don’t think about which brand is the best employer brand amongst energy companies – look for the best employer brand in the world. Don’t just try to learn from the best customer service brand among utilities, look for the company that offers the best customer service period.

The best energy brands use segmentation tools

It’s almost impossible to be like by everyone. Instead, you should use the appropriate tools to segment the market. The most simple tool to use is demographics. But you can’t go in blind and decide to be the brand for single women aged 26-37 living in a certain area with this high yearly revenue. You need to know why this group is the right one for your brand and your value offering. It is often said that typical demographical groups are dead – people can’t be put into categories based on gender, age or where they live. There are multiple tools that segment that market based on more things than on demographics. Find the groups that your brand speaks to and figure out how to speak to them.

The best energy brands are customer oriented

Customer engagement is not about smart gadgets. It comes naturally when a brand speaks to the customers on a personal level and connects to them on an emotional level. The smart gadgets help but if there is nothing that connects to the customer other than a socket on the wall or some hardware, then there is no chance of communication. The best brands have created an emotional value that can be hard for competitors to compete with.

The best energy brands measure up

We have established that good branding is about knowing the customer. But good branding is about knowing yourself. What you stand for and what your brand is capable to do. But you need to know where your brand stands and where it stands in the minds of your customers. The best energy brands are constantly measuring how they are doing and benchmarking with other brands. They are not afraid to reach out proactively to customers and ask them what they think – this is not done once a year – it can be once a month or even once a week.

The best brands are on a mission

They offer superior brand value by offering something unique and different from others in the sector. That superior value stems from a specific brand mission – they are not just selling energy – they are often trying to change the world. A good example of good branding is in the green energy sector. Today, almost every supplier has started to become green. So green has become the new black in energy and it’s hard to differentiate based on the green origin of the energy alone. Superior green brands today have to dig deeper and be sustainable to the core and offer customers a buy-in towards a vision of the future.

Branding Bananas and other commodities

The most basic requirement for branding is differentiation. But how is utility branding possible when the product itself can’t be differentiated? How is energy market segmentation even possible when everyone is buying the same thing? These are questions that you might use to make an argument that branding for energy companies is a waste of time – the only differentiator is the price. You can only gain new customers by offering a lower price. As the experience from the UK has shown – trying to lead a race to the bottom can lead your brand to bankruptcy.

To demonstrate that a commodity can be differentiated by a brand, it is popular to point to other industries that have gone the branding route. Branded salt is sold at a premium and there is a seemingly endless supply of telecommunication brands active globally. But the best example of a well-branded commodity that differentiates primarily on owning part of consumers hearts and minds are bananas. One brand, in particular, has become synonyms with bananas. That brand is Chiquita. When people are asked to name the first brand that they connect with bananas, its Chiquita. Not many people can tell the difference between regular yellow bananas.

As finalists for the World’s Best Energy Brands Awards have shown, it is possible to differentiate a mere commodity such as electricity.  (follow the link to get a glimpse of some great brand case studies from the energy industry).

Electricity is a basic necessity and it is price sensitive up to a point – the brands that have been the most successful in the market have found a balance between offering a competitive price structure and giving customers a reason to choose a brand that offers something more than just a basic necessity.

Sometimes the commodity itself is differentiated – well not the electrons themselves but the source where the electrons are generated. Say hello to Green Energy Marketing. Clean Energy Industry Strategic Communications is probably the most notable and has been used the longest as a differentiator on the market. But making a clean energy strategic market entry has become more challenging than before since almost everybody on the market is either 100% renewable or offering renewables as an option on the market.

Energy Decentralisation is providing more opportunities as well as challenges to energy brands. Distributed generation and prosumers has changed the energy brand spectrum. Electricity brands are becoming a more flexible concept since customers do not need to be connected to the grid and can do business with electricity brands that only supply them with the tools and equipment needed for the customers to be self-sufficient of energy.

The most important thing in creating a brand in the energy space is to find out how to be different and the most enduring way of being different from the competition is to claim a feeling. In the end – people make their choice by determining who they trust.

Gain insights and earn customer engagement

customer engagement energy utility marketing branding CHARGE Energy

Energy company branding is pretty simple at the core. The World’s Best Energy Brands have it in common to be able to identify segments in the market. The best brands offer their target groups specific offerings and give them tailor-made marketing message that gives the impression of a coherent brand-voice. Despite advances in technology – the core of marketing is still the 4P’s. But technology creates new ways to present the product, new places to sell it at and new ways to promote it. It also gives new ways to find out more about the consumer.

Learn more about energy branding and dig deep into branding case studies in the energy industry. Join us at CHARGE 2018 – the only utilities and energy conference that covers branding in the energy space!

Easy days are over

A major task of any company selling and marketing a product or a service is to really figure out what you are offering, to which potential customers and how you are different from everyone else on the market. This used to be a lot easier, a company would come up with a product and find the right segment was easy, husband, housewife, urban or rural. Then societal changes came along and these simple groups of consumers split up and new-sprung out. The teenager is more complex and people in their twenties are now of all ages.

Big Data helps

Energy utilities around the world are doing their best to know their customers which is the technical term for analyzing data and identifying patterns. Big data can, of course, provide great insights that are not easy to identify from interviews or surveys. But the downside is that energy companies often skip the part of getting to know their customers – the customers become blips on the screen that leave data points. Gathering large amounts of quantitative user data is relatively easy, it’s just a question of finding the right software and let the algorithms get to know the customers.

A good brand uses algorithms to gain better insight into the behaviour of the customer but in most cases, it is used to build upon knowledge that is founded on qualitative research that is more or less the foundations of the brand.

Don’t forget qualitative

Some might dismiss qualitative studies as anecdotal evidence or by simply pointing out that if Henry Ford would have asked people what they wanted, he would have made the horse cart faster. It is correct that you should not take focus groups or customers too literally, an active mind is needed to analyze what is said to you and form concrete principles – read between the lines and integrate truths.

Find out more

Artificial intelligence is yet to be able to do that. A good first step is asking oneself “what would I as a customer want from a provider?” and then asking the same question to people you know and see if there is something in common.

Find out more about how the Best Energy Brands identify and speak to their different segments in the report on the World’s Best Energy Brands which is available now. Including energy company case studies from around the world.

 

The Decentralisation and democratisation of Energy

There are many current challenges in the energy sector. The sector is adapting to increased demand for sustainable energy and balancing new renewable sources with the current loads of the users connected to the grid. The generation of energy by renewables such as wind and solar at industrial scale is not the only challenge the utilities need to find a sustainable way to implement but also how to feed the electricity created by distributed generation and prosumers onto the grid.

Communicating with prosumers

These challenges are not only for the engineers to figure out – they create an energy marketing challenge – how good are the energy brands in communicating with end customers of energy and how strong are the brands in creating a dialogue with different stakeholders in order to implement the renewables and different types of technology and adapt users to the new reality of the energy space.

A new two-way dialogue between energy company and consumer

Distributed generation and prosumers have created a whole new dialogue between utilities and the public – the public is no longer just the recipient of energy but is starting to feed electricity into the grid. It has been a headache for the regular consumer to understand the normal energy bills, imagine how the regular prosumer is able to understand the bill when he or she is the one charging the utility. This requires clear communication, good utility marketing and a good energy marketing communication needs the clear vision of the energy brand behind it.

De-centralising Energy

The democratisation of energy will happen on some scale in the coming years. The advancements in solar technology and small-scale generation of energy mean that price will come down. Powered by blockchain technology and smart devices, microgrids will begin to become more frequent where people trade energy they generate with their neighbours. Peer to peer trading of energy might become as common as running water is today. The energy customer of tomorrow might sell excess electricity that came from the rooftop and stored in their car onto the grid. Development and implementation of vehicle-to-grid solutions has already begun.

Adjusting to a new reality

Energy companies, whether it is the traditional utility or energy retailers might have to adjust to this new reality of microgrids and peer to peer energy trading. Although the need for their traditional services might not be as needed as it is today, they are trusted as experts in electricity and their brands might take advantage of that brand asset. Energy as a service will become an invaluable part of the business model and it will be interesting to follow the development of the unique value propositions that the future energy brands will offer their customers.

 

Mind the perception gap

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The brand gap. Image credit: LarsEn Energy Branding www.larsen.energy

The biggest challenge any utility brand faces is the gap between its brand image and brand identity. Brand image is how outsiders perceive the brand and identity is how the brand is being perceived inside the company or how managers and employees want the brand to be perceived by outsiders. This is not a problem exclusive to utility brands, energy brands or other corporate brands that have a similar background as energy companies.

Why the gap exists

The biggest reason for the perception gap is that branding of the utility is not taken seriously enough. Research has shown that the biggest hurdle for utilities to become a strong brand is the lack of understanding on behalf of management. The marketing departments have a great understanding of the importance of branding and what branding is about and what it is not exclusively about. The problem lies with other departments and top management.

What is branding about?

To many, branding is the issue of marketing or comms – for many, branding is nice colours and a cool logo. But branding is not something that can be siloed in a single department. For the utility brand to succeed as an energy brand, the whole organisation needs to live and breathe the brand. The best definition of a brand is that is whatever people perceive about the organisation. This means every interaction that the customer has had with the utility, every interaction the customer is having and will have with the utility brand. Every thought the customer has and will have about the utility.

Maintaining the gap

Looking at branding as something best kept contained at marketing or worse, containing branding for a designer that draws a logo, means that there will be a big perceptual gap between what the company wants to be perceived as and what the customer perceives the company to be. A CEO might want a brand-overhaul and asks the ad agency to draw a cool logo but no research is conducted on where this cool factor should stem from inside the corporation or its culture. The marketing department might come up with the idea for brand values but gets no support to implement it within the organisation and get everyone involved.

The results of the gap

Trying to be something that you are not will result in the customer to perceive one personality in the marketing material and branding of a utility but will perceive several other personalities and messages while communicating with the utility and its employees. Branding for utilities just like any other organisation is a human resource matter as well as a strategy issue. A clearly defined brand is an important factor of a well defined and well-organised company strategy.

Closing the gap

There are two ways to close the gap. One way is to identify what the utility and its corporate culture are about and emphasise the core values of everyone inside the utility. Another way is to align the long-term vision of the brand with the long-term vision of the utility. This might need some changes in the culture of the company and the core values of the employees. Either way, re-branding an established utility is not done overnight. It is a process that might take one or two years to implement internally and a lifetime to maintain and adjust.

The global utility in a new energy paradigm

As Ryan O’Keeffe pointed out during his presentation at the CHARGE Energy Branding Conference last September, large energy companies with a long legacy of generating and selling electricity, are not normally considered cool.

The company has and is going through a comprehensive overhaul of its image, meaning and role in the fast-changing energy environment. As Mr O’Keeffe pointed out, it was a change in strategy that was long overdue, the company’s old logo was designed when Google was still operating out of a garage in Silicon Valley.

We as a power company can and must play a key role in tackling these challenges.

Enel found itself working in a new energy paradigm and found that how it had been conducting itself for the last fifty years was not going to work in the next fifty years. During the rebranding process, there were some strengths that the brand possessed that would become valuable in the changing energy landscape. By taking a humble approach and acknowledging that a big corporation with a big corporation culture might not foster innovation that could keep up with the time. The brand turned this weakness into a strength by using its global scale and resources to foster open innovation; helping entrepreneurs that are set out to change the energy paradigm even further.

Ryan’s presentation from CHARGE – The World’s First Energy Branding conference can be seen below. Enel was one of the finalists for the 2016 CHARGE Awards as one of the world’s best energy brands. The report on the best utility brands has been published by LarsEn Energy Branding and can be found here. The 2017 CHARGE Energy Branding conference takes place in Reykjavik October 9-10 where the CHARGE Awards will be presented for the second time.

Communicating a Green Energy Value Proposition

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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.

Sustainability as a brand asset

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.

 

Utilities gone social

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Photo Credit: HowToStartABlogOnline.net

 

It is time for the utilities to shift their messaging in social media. From primarily sending messages about outages, utilities need to add an emphasis on customer relationships.

Tamara McCleary, CEO of Thulium has worked with companies such a IBM and Verizon to help them with driving brand engagement. She spoke on the importance of utilities becoming personal and drive the conversation towards a more human interaction.

The data utilities have today give them a unique opportunity to know the customer better – energy companies need to stop talking at customers but must start a conversation with them.