Via Smart Grid News, an interesting commentary on the future of behavioral energy efficiency (BEE) initiatives. As oft mused here, we think there is limited longevity to BEE gains which is why we’ve advocated development of smart markets:
As I’m sure you are aware (how could you have missed the fanfare?) Apple gave us “just one more thing” this week with the highly anticipated Apple Watch. Billed as the most personal device the company has ever developed, the Apple Watch is set to forever redefine our relationship with accessories. This most intimate device resonates well with me and aligns with the market trends we see driving change in the energy industry. Apple also made a move that didn’t generate the same amount of interest but to me it is just as compelling. They discontinued the classic iPod.
The iPod was a transformative product. It changed the way we buy and consume music and set the tone for future Apple products like the iPhone and iPad. And yet despite its success, the device itself has become irrelevant because its core reason for being – music – was integrated into other devices. Music was to the iPod what Behavioral Energy Efficiency (BEE) has been to the energy industry transformation. Let me explain.
Motivating disinterested consumers
Unlike other “offline” energy efficiency initiatives, BEE proved that engaging software, data analytics and science could motivate an otherwise disinterested consumer to care and get involved in managing their energy footprint. Compliance mandates were met and BEE strategies took their place as part of an expanding portfolio. Recent articles report anywhere from 1.5 percent to 3.5 percent can be expected from these programs. Not too shabby. But in an energy-as-a-service model, BEE is only one part of the complete equation. It is one strategy to be leveraged to achieve only one of many possible outcomes. In a customer first world, it’s got a shelf life of its own.
Companies that build an entire business on BEE need to adapt or go the way of the iPod. And similarly, those Energy Service Providers (ESPs) that put too much emphasis on energy efficiency solutions are going to miss the big picture.
So what’s needed instead? Here is my two cents on what you should consider as you determine the role BEE and other energy management applications play in your overall strategy.
- Become a consumer services company – Manage a storefront. Think of your offering to customers as an application store. Provide a range of options that consumers can choose from. If you went to a store that continually sold you a single product without any choice, I would venture to guess you would stop going there. Customers have unique attributes and needs … treat them accordingly. Serve the customer of one.
- Maintain your link to the customer – Once you have created your storefront, be the shopkeeper. Apple maintained a rigorous process for determining the viability of applications and ensuring you purchased them from the App Store. So while you should absolutely partner with technology providers to design the best possible engagement platform, ultimately it’s your data, and your understanding of the individual. Own it.
- Understand who you are selling to – Data is becoming increasingly important across industries and energy is no different. Understanding a customer’s unique characteristics and propensity to act is paramount to determining which services to offer and who is most inclined to use them. Not everyone will want a Home Energy Report because they don’t have the time or interest to track their usage. But they may want to put solar on their roof and are unsure of where to turn to. Why can’t it be you?
The classic iPod may have been discontinued but it will live forever in technology lore because it ushered in a new way of experiencing a commodity (of sorts) – music. BEE has done the same for energy. Rather than approaching it as the Holy Grail, however, think of it rather as the gateway to a much broader and dynamic mix of service offerings, which ultimately will transform the way we all use energy.
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