Post on 11-Jan-2016
total energy and sustainability management
MEC: CUSTOMER ENGAGEMENT
October 2013
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Agenda
• Customer Engagement Platform• Pilot Project – Segmentation• Pilot Project - Conversion• Next Steps
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Direct Mail Mobile App Social Media EE Rewards Program Call Center
Ecova Utility Skinned Web Portal
Home Energy Reports
Home Energy Reports
Customer Engagement Platform Vision: info to action
Data/ AppsData/ Apps
In Home Audit(tablet data capture)
Customize & Order + Add-on Products
BUY Online /
Retailer Locator
Schedule
Contractor Referral / Ratings
(Angie’s List)
Request Info & Quote
Database/ Program Analytics
Track
Measure
Advance
Home Energy Reports
Home Energy Reports
Graduated Escalation of Customer Energy Efficiency Relationship
Financing Options
EE Kit
Retail Products
DI / DIY Products
DR/Energy Mgmt
Weatherization
Major Upgrades
EcovaHome Energy Improvement
Engine
(leveraging R&P work, Top 10, program
experience, propensity to participate data,
etc.)
AdvancedTargeting /
RecommendationAlgorithms
Retail In-field
Services
Rebate Processing
DI/Audit Field
Services
Trade Ally MgmtMob App / Portal
Utility Analytics - Reporting & Portal
Utility Customer Site-based Energy Profile
eHome Audit(online)
Targeted Mktg Outreach Mktg Analytics / Program CRM Platform
CUST Data FusionUsage, geographic,
demographic, participation
CUST Data FusionUsage, geographic,
demographic, participation
1. Segmentation & Scoring (Pilot)
2. Home Audit & Engagement (Pilot)
3. Program CRM /Workflow/Database Platform (Pilot)
5. Data Warehouse (defining)
4.b Ecommerce Add-on Marketplace/ Rebate Gift Card (Defining)
4.a Portal (Pilot)
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Customer Engagement – Segmentation and Scoring Pilot
Identify highest potential customers:1. High propensity customer segments2. Greatest savings potential customers
Segmentation& Scoring
Targeted Marketing Outreach
Home Audit & Engagement
Platform
Engage high potential customers:1. Targeted messaging to each segment2. Ongoing engagement3. Tracking response across each campaign
Simplify path to savings for customers and contractors:
Proprietary Ecova algorithm (powered by Trove)
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Customer Engagement – So What?
Benefits1.Increased customer satisfaction
2.Increased trade ally satisfaction & participation
3.Higher likelihood of participation in other utility offers
4.Increased Total Savings & Cost EffectivenessIncr. # of participants (improved conversion)
Incr. savings per participant
Lower admin & incentive spend per KW
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Pilot Project• Goal
• Target customers based on their likelihood to participate in an incentive program and their potential savings. Utilize targeting information to increase effectiveness of our marketing outreach.
• Approach• Utilize historical data to create a customer profile based on a subset of
specific common characteristics• Analyze and Score all utility customers using this profile• Optimize score based on program goals and marketing costs• Integrate scores into future marketing campaigns
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Pilot Project
Likelihood to Respond
(Responders)
Likelihood to Perform Recommendations
(Rebaters)
Potential Load Shift(Users)
Combined Scores(Combined_Score_Heating)(Combined_Score_Cooling)
Actionable Intelligence
Historical Customer Participation Data
Current Customer Participation Data
Customer Usage Data
(Monthly)
Demographic Data(Acxiom)
Proprietary Data Analysis
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Data Analysis & Results
Responders - individuals with
the highest likelihood to perform Audit /Assessment.
Rebaters - individuals with the highest likelihood to apply for a rebate.
Users- individuals with
highest potential kWh savings compared to
similar homes.
Likelihood to Respond
Likelihood to Perform
Potential Savings
Actionable IntelligenceOverall Combined Score
Combined Heating Score
Combined Cooling Score
Geo Cluster Scores
Measure-Specific Scores
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Responders
• 91% of Past Marketing Responders have scores > 7• Increased targeting towards higher scores should increase our response rate
Population Avg: 5.5
Marketing Avg: 6.7 Responder
Avg: 9.2
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Rebaters
• Higher Rebater Scores Correlate with Higher Responder to Rebater Conversion Rates
• 81% of past Rebaters have scores >7
Population Avg: 5.5
Marketing Avg: 6.9
Rebater Avg: 8.7
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Combined Score
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Combined Score
Target Customer BaseTarget
Population Size
Response Rate*
Responder to Rebater
Conversion Rate**
Avg. Annual
Reduction/ Responder
(kWh)**
Avg. Annual
Reduction/Rebater (kWh)**
Available MWh
Current Marketing (Doorhangers, Direct Mail)
26,667 2.5% 47.5% 642 1,386 663
Combined Score Heating = 10 14,800 5.7% 61.9% 692 2,331 1,448
Combined Score Heating>= 9 66,504 5.5% 57.9% 666 2,113 5,498
Combined Score Heating>= 8 141,659 4.4% 57.1% 652 1,946 8,753
• * Response rates learned from current marketing campaign. • ** Rebater Conversion Rates, and expected kWh were learned from all historical and ongoing programs (8,098
program participants)
Take Aways:Combined Scores optimize the relationship between response rates, rebater conversion rates, potential load reductions in order to maximize marketing performance.
The MWh goal can be reached by targeting customers with Combined Scores >=8
Take Aways:Combined Scores optimize the relationship between response rates, rebater conversion rates, potential load reductions in order to maximize marketing performance.
The MWh goal can be reached by targeting customers with Combined Scores >=8
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Current Marketing vs Expected Results
8,753
5,498
1,448
663
Area of Circle = Total Energy Reduction Available (MWh)
Current MarketingExpected Results
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Customer Engagement - Conversion
8,753
5,498
1,448
663
Massmarket
outreach
Massmarket
outreachSchedule visits Schedule visits
Provide auditProvide auditCustomer
implementsCustomer
implements
Streamline & simplify
scheduling
Streamline & simplify
scheduling
Segment & target most promising
customers
Segment & target most promising
customers Help customer implement &
follow-up
Help customer implement &
follow-up
Provide audits, actionable info &
easy ways to take next steps
Provide audits, actionable info &
easy ways to take next steps
CURRENT PROGRAM
CUSTOMER ENGAGEMENT PLATFORM
Its all about Conversion
(C%)
C%
c%
c%
c%
C%
Deeper EE savings
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Customer Engagement - Conversion AnalysisParticipant Conversion Model
Nu
mb
er
of
Part
icip
an
ts
Program EE Savings
CEP HIGH IMPACT: +23%
CEP LOW IMPACT: +14%
(inversely 14-23% less “leads” areneeded to achieve equivalent savings)
BASELINE CONVERSION
CEP LOW IMPACT CONVERSION
CEP HIGH IMPACT CONVERSION
Small incremental conversion +slight increased savings/participant
= significant program EE savings
+ efficient incentive budget use
BASELINE: Historical conversion
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Summer Marketing Campaign
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Marketing Plan
• Implement a targeted campaign using the analyzed data, promoting the program with customized messages to utility customers who have been identified Responders, Rebaters and Users
• Campaign will be seasonal and encourage customers to take measures to cool their homes
• Campaign will launch early May and run through August
Overview
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Marketing Plan
• Implement targeted outreach to the identified customers as well as broad community outreach
• Offer bundled measures that have been suggested in the 2013 measure mix
• The targeted customers will be split into two groups:• Group #1: Have not participated in the program at all• Group #2: Have done an audit/assessment and/or upgrade measure
Strategy
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Marketing Plan
• Creative will be seasonal and focus on the summer need to cool homes
• Feature bundled measures that focus on cooling the home and bring the most energy savings
• Messaging will be slightly different for each group• Group #1: Focus on comfort and home improvement – first with the
assessment/audit, then even more with upgrades and rebates.• Group #2: Focus on the monetary and energy savings of rebates and
doing a bundle of measures
Messaging
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Marketing Plan
• Stagger the following tactics• Week 1 – Eblast• Week 2 – Direct mailer• Week 3 – Door Hangers• Various times - Billboards
• Energy kit insert – begin inserting in May• Contractor handout – distribute beforehand
Tactics
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Next Steps
• Results of summer campaign due end of October
• Test results against expected benefits
• Make adjustments and apply to next campaign
• Build out audit/trade ally market in first half of 2014
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Questions
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Technology Reshapes the Energy Value Chain Who are the Winners and Losers?
Biomass New Gas Turbines Wind/Solar Farms SMR IGCC Storage
• HVDC• Superconductivity• Smart Grid• Cyber Security
• Smart meters• TOU• DG• Small
Storage
• EE• DR• Reliability• Power Quality
• Rooftop Solar• Micro CHP• PHEV• Storage• Home
Automation• Smart
Buildings
Where is the value created?What is the role of the regulator?
New competitors include:•NRG•Direct Energy•Schneider Electric•SolarCity•Google•Private Equity
New competitors include:•NRG•Direct Energy•Schneider Electric•SolarCity•Google•Private Equity
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Key Beliefs and Assumptions must be challenged: What is our view of the world?
Belief/Assumption Alternative View1. Maintaining regulated business model is key to realizing
attractive returnsCompany should consider business development options as technology disruption requires marketing skills, partners, and a new business model
2. Flat load growth over the 5-year planning horizon US economic expansion driven by industrial sector (on shoring)
3. Increasing infrastructure requirements (coal retirements, DG, reliability, cybersecurity, etc.) leads to rate pressure and planning complexity
Regulated assets become stranded as a result of uneven regulation, financing limitations and microgrids, future value is managing the customer and the grid
4. Idling coal is the most economic option for meeting current and future environmental standards
Future environmental standards will not be stringent enough to warrant replacing coal capacity with other sources of generation
5. Natural gas generation is important to fill in the gaps until nuclear is back in favor
Sustained low natural gas prices, increasing environmental standards and nuclear safety issues support more aggressive natural gas additions
6. Renewables driven by economics and RPS requirements are at least 7- 10 years away
Solar attains grid parity over the next 3 years
7. Customers want low price and reliability Customers want simple optimization and empowerment
8. Technology is ahead of regulatory policy and current structures do not provide the right incentives
New competitors take advantage of grid enhancements to partially disconnect without debating net metering
9. Top quartile costs are a competitive advantage DER integration, customer enablement, better reliability and innovative solutions are strategic advantages
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Questions
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Creating long-term value for customers, shareholders and
employees
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Future State
• A leading provider of low-cost power
• Greater reliance on clean generation resources, including energy efficiency
• Optimized fleet material condition
• Customer-driven
• Strategic and agile
• Collaborative teamwork
• Proactive and consistent
• Strategy-driven planning and budgeting
• Modeled values
• High employee engagement and organizational health
• Develop top talent
Current State
• Rates higher than regional average
• Heavy reliance on coal generation
• Poor asset material condition
• Financially-focused
• Tactical and indecisive
• Operational silos
• Reactive and inconsistent
• Budget-driven planning and strategy
• Stated values
• Low employee engagement and organizational health
• Hire top talent Keys to Success: •Strategic Alignment•Customer Excellence•Strong Organizational Health•Capital Efficiency
Enterprise Strategic Plan