For a Better ROI, Differentiate Your Offering
We’ve discussed the merits of segmenting your customers and your trade allies. In doing so you are better able to communicate with them, target them with marketing and outreach and fundamentally understand what and how they contribute to achieving your goals, while improving your customer satisfaction.
What we haven’t explored is differentiation the offer (incentives and other services). I’ve worked with enough programs to know that not all of them do this – and for a variety of reasons. The reasoning varies but includes: the scale of the market doesn’t merit it, the utility views differentiation as demonstrating a bias toward one customer or trade ally, or a program is still in relative infancy and not in need of an evolved portfolio of offerings.
But are any of those a good enough rationale for not providing targeted and cost efficient offerings to the market. Will what you are currently offering get you to where you want to go?
If you have taken the time to segment your market participants – customers and trade allies – then you are half way to differentiating your offer. With segmentation, you have begun to recognize who they are, what they contribute, what their potential is. The deeper the segmentation, the better the understanding of the customer or the trade ally. Now that you know who they are, you can begin to define offers and levels of service or support that are relevant to them. Your program is now more relevant to them. They are beginning to recognize that you see them a particular type of business with unique needs. And you are presenting them with opportunities that speak to them. They are starting to see you as relevant.
Why does differentiation matter? Because if you want to connect to your market and do it effectively and efficiently you are going need to provide them with an opportunity that is relevant to them. And when you do that, your budget will be more effectively spent – you won’t be busy trying to promote an offering that has dwindling relevance and uptake, with static costs. It matters because your customers and trade allies are as savvy in their professional lives as they are in their personal lives. And if you insist on offering all of them the same measures, incentive structures, messages, etc. they will recognize it. And their perception of your program’s value and relevance will suffer.
The same customer that understands product differentiation when they invest in a vehicle or software purchased for their business, expects that your program does the same, and provides them with an offer that speaks to them. When it doesn’t they become harder to sell to. Costlier to sell to.
If you provide all customers and trade allies with the same level of service or incentive caps, your return on investment suffers. Equal investment of funds, with differing kWh prizes drives up your ROI and your $/kWh analysis. You work harder to reach the customers who will participate, and in doing so spend your money inefficiently.
A different investment threshold or expectation of ROI does not mean unfair or unequitable treatment. It means investment relative to opportunity. It’s smart investment and proactive program management. It means you understand your market and your customers.
The 9 Box Model isn’t just about differentiating your marketing message, it is about creating offers or bundles that speak to the customer, to the trade ally. It’s about recognizing the different drivers and hurdles in their day to day realities, and creating an opportunity that meets their needs.
In doing so, you will improve your program performance and increase customer satisfaction.
Karen Germain is a Business Direction Principal with Program Development and Implementation (PDI), DNV GL Energy Services USA Inc. She leads the Outreach strategy for PDI’s energy efficiency program implementation teams. Ms. Germain was previously the Head of External Relations with The Carbon Trust (U.K.) where she oversaw relationships with more than 3,000 market influencers including trade associations, professional institutes, and the trade unions. She has held various positions in consulting in both the UK and North America. She holds an MBA in International Strategy and Management and a BS in Organizational Behavior. Further reading from Karen can be found at trade ally success, excel at outreach , and you can explore DNV GL’s new Energy Transition Outlook.