Communication umbrellas for residential and C I consumers February

Communication umbrellas for residential and C&I consumers February 26 th 2015

Communication Umbrellas include: » A history of utility communication » Key messages for driving AD implementation » Motivational drivers for customers » Segmentation » Guidelines » Communication methodology » Examples of segmented communications

Key messages for communication with customers about AD » » Personalized messages Segmentation Step by step implementation AD communication is also a change management process and any communication effort should involve the whole company » Stakeholders views should always be taken into account, as AD only succeeds, when everybody in the value chain agrees on the goal

A History of Utility Communication The newly liberated energy market communication 1. 2. 3. First goal was to establish awareness Very common approach No differentiation between the utilities, and soon they needed to be more focused on how to stand out from the crowd…

New products was the next attempt for many utilities - and focusing on price… 1. 2. Being bigger equalled being better. Prediction was, that in Germany in 5 years only a few utilities would survive. As of today there exists still around a thousand. The question was; how to differentiate on a product which no one can see – creating a golden era for marketing agencies and consultants – and conference producers…

Building a brand was a logical next step… Football seemed to be quite popular – and still is… 1. A study of these early attempts concludes that even though being extremely well made (and costly) the communicated values do not match the target group. 2. The gap between the consumer, the messaging and “energy” is just too big 3. Messaging became unclear and in a time of rising energy prices the spending on commercials seemed ridiculous to many people

The trend can be found all over Europe And it become more sophisticated over time 1. The relation between the individual player and the individual customer comes into play in the never versions of the attempt. 2. But still the messaging is unclear and primarily focused on creating a brand. 3. Over the last 4 years the trend has almost disappeared…

Next thing was a little more subtle… Utilities trying to show that they cared 1. 2. 3. All over Europe customers were falling either ignorant or worse to the efforts of the utilities. Still many people had a hard time relating to the product Increasingly the sector was under pressure to show evidence of the market; it seemed only UK had moved ahead…

With the financial crisis a change appeared … and the customer Now has to invest in Green Power 1. All over Europe the utilities created new green products and a new green profile 2. But for the end customer at was still hard to decide whether the energy was green – since it appeared to be the same product whatsoever

And RWE focusing on both price and being green But in different packaging 1. Popular band from the 80’s 2. Reappearing as the RWE energy musicians 3. Trying to have people buying green electricity or Eco-Electricity – with a fixed price

User behaviour is changing 18% 21% Number of households saying ”no” to paper ads Source: Post Danmark Yearly e-mail growth source: Forrester 14. 2% Household Telephone Usage (drop in 2009) source: ITU World Telecommunication 10% Network TV Viewership (drop in 2009) Source: TV Report 17. 3% Circulation of Newspapers (drop from 2001 to 2008) Source: Newspaper Assn of America 475 mio Smart Phones shipped in 2011 source: IDC 1, 3 bio Facebook users Source: Internet World Stats 2, 8 bio Global Internet Users Source: Internet World Stats

Which makes the way we use medias change Active Social Mobile Web Targeted Channels Broad Channels Email Print Passive

And the way we respond… OUTBOUND Print Call Center Store INBOUND

And the way we respond… OUTBOUND Print Call Center Email Store Mobile Web INBOUND Social

And the way we respond… OUTBOUND Print Call Center Email Store Mobil Web INBOUND Social

C&I communication guideline derived from practical experience. Who should be contacted? • Commercial Manager • Operational Manager • Energy Manager • Facility Manager, Tenant / Consumer, Owner What should be communicated (FAQs) • Concept • Benefits • Perceived detrimental effects • Technology that will be used / installed • Contractual frameworks • Barriers and hurdles to participate • Self-assessment on attractiveness of DR for participation How to interact? • Short videos and infographics • e. Books, case studies, white papers • Blog articles • Regular progress reports

Segmentation from ADVANCED surveys Active • • • Strong environmental views Concern over energy costs Take action in reducing energy consumption Moderate • • • Comfortable • • • Some environmental views Less concerned with costs Less interested in taking action to reduce consumption Some environmental views Some concern with energy costs Take action in reducing energy consumption Oppositional • • • Anti-environmental views Not concerned with costs Not interested in reducing consumption or in technology

Customer Segments for AD services Active Concerned Green Moderate Indifferent Oppositional Non-active Not concerned Anti green

Motivational drivers for residential customers

Mapping Platforms to Roles & Communications Platform Comfortable Active Moderate Oppositional Utility Role Means of Communication Advisor Step by step explanation, constant reassurance, not too many words. Easy to understand diagrams Guide Feed back programs, analysis, follow up, recommendations – applauding - very personal Coach Asking questions – giving answers. Encouraging, status on environmental benefits Teacher Calming down, reassuring. Telling what to do and explaining. Positive words, giving way, understanding, small steps at a time

Mapping Platforms to Propositions Platforms Comfortable Active Moderate Oppositional Utility Role Nature of propositions Advisor Retention programs, AD as a way of assuring stability Goal: Confidence Guide Energy Saving programs with documented benefits, Benchmarking tools. AD as a way to economical savings and a green way of consuming energy Goal: Saving Coach CO 2 saving scheme, educational programs, Energy Reports. AD as a way to a greener way of consuming energy Goal: Trust Teacher Information and education. Storytelling and case stories. Not selling AD, instead educating. Goal: Relation and change of attitude

The Communication Process – How to build a digital AD communications platform Goals and KPI’s Data and Analysis AD Strategy Concept and Design Production and technical implementation Launch What do we want to achieve for whom and with which result? Who are our customers? How do we identify desired and critical behaviour What do we communicate to whom, how, at which time and through which channel? How will it look? How will is sound? How will it feel? Production and implementation of selected services Quality Assurance and status on results and achievements Workshop to gain insights into existing systems and data Data mining Interactive data sessions Cluster-analysis Key Correlations AD propositions workshop • Concept • Design • Text tonality Text adaption and adjustments Design adaption Dialogue flows configuration Integration setup Stepwise launch Quality assurance Control group benchmarking Evaluations Finished creative elements ready for use in AD propositions Finished digital and physical elements Emails, SMS Rule flows Full integration Web interfaces Documented results Determining relevant KPI’s – measurable and realistic Customer insights Set goals for KPIs Influence on data and systems • Prioritized and Selected AD propositions • Technical system overview Technical implementation

The ADVANCED Customer Journeys § Are based on the ADVANCED conceptual model § Are specified per Persona* § Support the realisation of the phases ‘Drive’, ‘Act’, and ‘Grow & Share’ (as the phases ‘Intervene’ and ‘Enable’ do not require specific marketing and communication) § Address the customer point-of-view (examples are given in the next slide)

The customer journey explains the development of the relationship with the customer § Drive – Reach a potential customer before he is even aware; an approach through other ‘channels’ such as schools and local organisations might thus prove the most effective – Make customers interested by focusing on their values, needs, and situation § Act – Participation will often require new beahviour and this should be addressed – Think of how a customer would prefer the sign-up and what securities and guarantees they need – Support the customer with the first steps (installation, first use, etc) § Grow & Share – Support the integration of AD in a customer’s daily life, over the longer term – …. grow – Motivate him to share experiences in a way he/she is comfortable with

Each Persona has its own characteristics; explaining the differences in their journeys § Daniel - Active § – Strong environmental views; concern over energy costs; takes action in reducing energy consumption – Utility segment*: Green, Economical – Energy company is a ‘Guide’ § Maria – Moderate – Some environmental views; some concern with energy costs; takes action in reducing energy consumption – Utility segment: Comfortable – Energy company is a ‘Guide’ Susanna – Indifferent – Some environmental views; less concerned with costs; less interested in taking action to reduce consumption – Utility segment: Comfortable, Dreamer – Energy company is an ‘Advisor’ § Simon – Oppositional – Anti-environmental views; not concerned with costs; not interested in reducing consumption or in technology – Utility segment: Dreamer – Energy company is a ‘Teacher’

Getting started. . .

Comparison Benchmark Initial process 1/2 Customer Segmented Acknowledgement A First identifier in DB Existing Customer Segments A B C D Reward for signing up A First identifier in DB Non Exisiting Customer B C D A B C A B C

Initial process 2/2 1. Generic approach 2. Identify Personas 3. Customer Journeys

Different engagement strategies Becoming personal and engaging 1. 2. 3. 4. Dynamic personalisation • Eg. Weather report, central data on household, Google map etc. Education • What takes me further. My personal advise based on consumption and personal patterns and behaviour Involvement • Where we create value for the user. E. g AD propositions etc. Dialogue: • Ask questions, take surveys, messages, newsroom A. B. Customer can personalise and arrange widgets to create a comfortable universe on the home page The AD Customer dashboard holds different areas, where the content can be distributed.

Inspired by

Customer Journey Daniel DRIVE ACT GROW & SHARE • Sign up now (limited test spaces!) • Improve personal stats, try new features, help each other in the AD community • Save on current energy usage with new technologies Keywords & emotions • New, innovative, saving • Take part in experiment, be the first • No financial risks • Lease construction for AD tools or new smart appliances (if possible) • Make co-creation possible to improve AD, e. g. ask feedback through online forum and reward for giving input • Suggest more automation • Make sharing easy, e. g. app to share personal stats on social media • Online fora on topics such as new tech/gadgets (credible sources) • E-mail personally targeted based on current usage and savings potential • Online form • Installation = DIY with online tutorial, follow-up e-mail with video links for help and experience of others • E-mail newsletters, personal stats via app, online forum • First group to target • Proposition based: a new offering based on household trends e. g. consumption • Maintain ‘novelty’ by limiting the amount of time to sign up • Ask feedback quickly about installation and first experiences (within a month) • Regularly update on performance Value proposition Media Timing

Customer Journey Maria DRIVE ACT GROW & SHARE • Greener way of consuming energy, saving (costs & energy) • You can take part and make a difference, AD is now past experiment phase (!) • Step by step explanation of what is going to happen with the installation • Explanation and visualisation of what will happen /can be done after installation, with scenarios and Q&A • Assure about performance and actual (cost) savings • Coaching style (you are doing well) • Value proposition Cost control and greener consumption with AD • Step by step introduction of new technologies • No financial risks • No surprises • Special AD hotline for tips, questions, etc. • Start with one AD feature (e. g. display) and slowly extend installed base if customer permits • Reward for acting as ambassador among friends and neighbours, supported by an ambassador campaign with leaflets, testimonials, etc. Media • Personal letter based on current energy usage and savings potential • Follow-up call on letter, Q&A moment • Sign-up with online form and follow-up call after signing-up • Home visit for installation • Follow-up call after installation • E-mail newsletters with testimonials of performances of others • E-mail updates with personal performance and coaching tips • Second group to target • Proposition based: a new offering based on household trends e. g. consumption • Ensure enough time to have questions answered and time to decide before requiring to sign-up (e. g. a month) • A few times a year Keywords & emotions Timing

Customer Journey Susanna DRIVE GROW & SHARE ACT Keywords & emotions • Price stability in insecure market • Get introduced to technologies that will become more and more mainstream, see the options • Make comparisons possible with other options • AD as a future-proof solution • Transparancy about privacy • Assure about decision to participate, e. g. through testimonails of others • Assure about price stability e. g. by showing cost figures Value proposition • Inform about AD for future situation • Create awareness with gadget-like smart display • A special deal with a life event, e. g a free new smart appliance when moving to a new house • Suggest a new AD feature specifically based on personal AD related performance, e. g. flexible tariffs • Sign-up your peers-program (with e. g. first month AD energy for free) • Very clear website with comparisons and advice tool based on personal • Media • Through larger peer groups; school/uni • Online form to show interest, follow-up call • Third group to target • Customer Life Cycle approach: e. g. when person moves to another house (to make it personally relevant) • First respond to those that have filled in interest forms • If possible, in relation to other important life events, such as moving (again), having children, etc Timing E-mail with personal performance diagrams and historic comparisons, tips

Customer Journey Simon DRIVE ACT GROW & SHARE • Local municipality is involved, too • Transparancy about privacy • Small steps, but big results Keywords & emotions • Small changes and small steps, informative, not selling. Very transparant about the goals of AD • Positive reassurance; safe, secure, easy, support. Simple explanations by peers Value proposition • Does only require slight in habits (if any), e. g. only a smart display • Community deal: a group incentive for those who sign up • Local municipality / community organises gathering on results and share experiences Media • Local newspaper with testimonial • Information session in local community, public meetings • House visits • Sign-up with local ambassadors • Installation by mechanic with thorough explanation, follow-up call • Interviews with fellow AD customers in local newspaper, general updates on AD in letters • Last group to target • Customer Life Cycle approach: e. g. moving, or retirement (and cost saving is even more important) • Call within first week after installation • A few times a year Timing

Customer Journey C&I

AD customer dashboard Dialogue: With my supplier Push communication rule based comm. Control of consumption Alarms, activate meters, Education and Campaigning What takes me further. My personal advise based on consumption and personal patterns and behaviour Inspiration & dynamic: Overview: Control: Wow effect but with dynamic content giving energy advice for example based on current weather. E. g. . Weather report, central data on household, Google maps etc. Overview of consumption, development, meter status Involvement and Propositions Where we create value for the user. , for example tariff schemes, AD offerings etc. Profiling: Where we inspire and tease, test and collect more data Applications: Control devices Facebook , cross and up sales, shop etc.

Dashboard widgets, example: “The Electricity Dashboard” Dialogue: With my supplier Push communication rule based comm. - Indication of Current electricity Benchmark - Offering specific advice based on user profile - Similar profiles Best Practice stories Control: Control of consumption Alarms, activate meters, Smart Plugs Overview: Overview of consumption, development, meter status Plug Control and Status • The different widgets should all be designed to be either a full screen long, half a screen long or a quarter of a screen long (dynamic scaling). They should all have the flexibility to be moved and placed where the customer wants them. They should all be allowed to be hidden or selected again from a central screen, where all widgets can be selected from. Tabs instead of dots allows explanation of what the different screens does. • Indicates preferences – hide, move, skins etc. • Other Dashboards could be invented when they are needed to work alongside the “Electricity Dashboard”; “The Heating Dashboard, The Water Dashboard”, “The Security Dashboard”, “The Indoor Climate Dashboard”. The Dash Boards are for the “At a glance view of what is going on”.

Welcome Daniel! What would you like to do? Manage your household • • Overview Control See what you saved Keep score SHARE MY STATS Want to play and learn, click here

Play and learn Are you a better planner than your energy company? See how your energy behaviour influences your energy bill by matching demand supply! Why not you let your kids play, too! When is the best time for them to play on their game console? Do your like our planning game? Please give your feedback so we can improve!

Dear Maria From our experience you are doing remarkably well. In comparison with households like yours you are spending much less energy. We are intrigued – tell us more. Click here to tell us how you did it and earn reward points Energy might not be the favourite topic of family dinner conversations. From what we can see so far you might want to get some basic advice on how to reduce energy consumption and to be able to learn and share knowledge with others. We have very knowledgeable experts, who are very happy to share their experience with you. Link to Energy comparison site with energy advice We also wish to thank you very much for using our service. In XYZ Energy we take pride in sharing our knowledge with you. This service is free and there is no hidden agenda’s. The one which is not hidden though, is the fact that we want to prove to you that we can handle energy – and help you handle yours too. So if you are interested, we will be happy to offer you also our distribution products. Link to Energy products Very best regards, Helena Watson, Energy Advisor XYZ Energy

XYZ Energy com pany Project Blue Rose Garden • • • 24 houses 34 appartments Green surroundings Especially for young families Building starts feb 2015! You have alread y so many decis ions to take…. We have a tip fo r you that is sur e to be future-proof! Our Active Dem and service me ans keeping your future ene rgy costs in con trol. Go to our website or our information stand to find out more, make comparisons an d on how to realise your ow n future-proof e nergy-wise household!

Example: 1 -pager checklist for self-assessment. Checklist for C&I consumer to self-assess attractiveness of DR for his business. Source: Bavarian Trade Association, Germany (2012), https: //www. ihknuernberg. de/de/media/PDF/Innovation-Umwelt/Energie/bihk-studieenergiewende-im-strommarkt. pdf

Example: regular progress reports encourage participation

Communication umbrellas - key messages • Both the Residential and The C&I consumer segment is very heterogenous, making personalized and relevant communication even more important to motivate DR participation. • The AD Communication wheel can be applied also to both Residential and C&I consumer segments. • Messages have to be aligned with each phase of the customer journey: provide context and examples, transparency on results, encouragement for progress. • Convincing communication always needs to address barriers and hurdles – at the same time they need to be addressed by regulators. The Actionable frameworks provides relevant recommendations.

Recommendations § Segmentation is a needed prerequisite § Harvest the gold of your data, to enable personalized communication § Communicate in simple and clear terms – step by step § Make all communication directly linked to the customer’s doings § Cost and benefits shouldn’t be the key of the communication § Do not appeal to “ a higher consciousness” of being green, but enable consumers to be engaged by taking their concerns seriously and answering them. § Prepare for changes not only within the minds of the customers but as important internally in the organizations of the utility industry § Make use of PR opportunities to tell positive stories of AD to prepare the market § Make use of the new possibilities and business options by engaging with the end customer