Using the Web to Motivate Customers to Save Energy
Can an online game that teaches you how to save energy ever be as popular and addicting as Angry Birds? Are people going to be as drawn to checking out their energy use trends online as they are to checking out their friends’ photos and status updates on Facebook? Some utilities are making that bet by developing fun games and contests in an effort to increase customers’ awareness about energy efficiency and encourage them to use energy more wisely. It might seem like an unlikely way to capture people’s attention about energy, but so far, the results of this outreach are encouraging.
Because electricity and natural gas are invisible, low-involvement commodities, it can be difficult to engage customers about their electric and gas consumption. The only time that most people really think about electricity is when their power goes out or when they get their bill. Whereas social norms around littering and smoking have been firmly established, it’s been harder to ingrain norms around using energy wisely, precisely because it’s not obvious how much energy people are using just by looking at them. Utilities have a big stake in helping customers use energy more wisely. In most U.S. states, regulators have set aggressive demand-side management goals for utilities to meet. But more importantly, investing in efficiency and conservation—which are the lowest-cost resources—allows utilities to reduce their fuel costs and defer the huge costs of building new power plants.
Using the web to provide energy use information to customers is not new. Utilities have been building up their web site capabilities and designing more sophisticated energy use tools and interfaces for more than a decade. E Source’s 2011 web site benchmark study found that 82 out of the 100 largest energy utilities in the United States and Canada are providing some type of energy use analysis to their customers online. This analysis often comes in the form of an energy audit tool or account management software. Reviewers in E Source’s study noted that while they liked colorful graphs and charts that explain how customers use energy, they wanted utilities to take the information a step further and provide personalized recommendations on how to save energy. Seven out of ten utilities that offer this type of analysis also provide energy-saving tips.
Providing this information to customers is a great start—but it really hasn’t been enough to encourage a lot of customers to want to visit their utility’s web site. This is why utilities have been trying to figure out a way to drive more traffic to their web site or to reach customers through other sites. According to comScore, a digital business measurement and analytics company, three out of every four minutes spent on a social networking site are spent on Facebook. Since people spend so much time on social networking sites, it makes perfect sense for utilities to try to reach customers where they’re spending a lot of their time.
PG&E Helps Customers Track Savings on Facebook
In an effort to engage its customers and strengthen the link between behavior change and saving money, Pacific Gas and Electric Company (PG&E) launched a new tool during the winter 2011–12 season that allowed customers to easily monitor their energy use. The tool enabled customers to track their progress toward qualifying for a bill credit through the utility’s Winter Gas Savings program, which rewards customers who reduce their natural-gas use during the winter season with a bill credit of up to 20%.
The utility has run the program for several years, but since customers are automatically enrolled in it, most of them didn’t know much about it. In fact, sometimes customers didn’t even know why they received a credit on their bill, according to John Oldham, digital marketing manager for the utility.
Oldham says that PG&E’s goal was to create a tool that customers could use on multiple platforms, and in particular on Facebook, since people already spend so much time on that site. The Winter Gas Savings Progress Tracker tool provided a quick snapshot of each customer’s average daily gas use compared to his or her goal, and kept customers informed on their progress to earn a bill credit. The tracker tool also provided tips on how to save more energy and included a way for participants to share their progress with friends.
PG&E promoted the Progress Tracker through traditional media, the utility’s blog, Facebook ads, Twitter, e-mail, press releases, employee communications, and community newsletters. Initially, traffic to the tool was less than PG&E had hoped. Nevertheless, the teams got together and decided to do a late-season e-mail blast. Luckily, the e-mail was extremely effective, garnering the highest open rates (37%) in the history of PG&E’s e-mail campaigns for the program. The e-mail also prompted a much higher percentage of customers to log in to the Progress Tracker tool.
Overall, PG&E was pleased with the program and tracker tool results: About 80,000 customers logged on to the tool at least once. The utility found that customers who logged in to the Winter Gas Savings tool saved 23% more therms than their counterparts who did not use the tool. In addition, customers who logged in to the tool early in the season saved more energy than those who logged in only late in the season. Even more interesting was the fact that customers who logged in to the tracker four or more times saved an average of 69% more therms than those who logged in only once. Higher customer engagement clearly led to higher energy savings (see Figure 1).
PG&E plans to use the Progress Tracker tool again in the 2012–13 winter season. This time Oldham says it plans to send more frequent e-mail communications and targeted messages to further encourage customers to go online and use the tool.
Introducing Competition into the Mix
During the summer of 2011, San Diego Gas & Electric (SDG&E) partnered with Simple Energy to run an energy efficiency contest called the Biggest Energy Saver. Simple Energy is a social application that encourages customers to save energy through competition with their friends and neighbors online, allowing people to share their progress on Facebook, compete on the overall leaderboard, and win prizes. The Simple Energy application integrates with smart-meter data, translating real-time energy consumption information into an online social gaming system that rewards people with points and prizes for changing their energy usage patterns.
Although SDG&E ran the contest with only 200 customers the first year, the results were impressive. Participants who used Simple Energy’s social gaming app saved an average of 20% of their energy use over a three-month period, compared with 9% savings for those who used only in-home energy-saving devices. The winning customer reduced her family’s energy use by nearly 50% and won a laptop computer. The results show that using behavioral science approaches in combination with device control and real-time information can increase consumer engagement and energy savings.
In 2012, SDG&E launched a peak-time rebate program called Reduce Your Use, which gave customers a bill credit of up to $1.25 per kWh of electricity that they saved between 11 am and 6 pm on peak-demand days. In order to build more buzz around the program, the utility partnered with Simple Energy again to create the San Diego Energy Challenge, a competition in which customers could earn rewards and prizes (in addition to the bill credit) for reducing their consumption on peak-demand days (see Figure 2). The competition also included a real-world social and community element, encouraging customers to earn energy-saving points on behalf of a local middle school of their choice. Schools were eligible to earn money for school supplies, and the top three schools split a cash grant of $30,000.
Opower launched a similar online social application in April 2012. Opower became well known for its paper-based home energy reports that awarded a smiley face to customers who used less energy than their neighbors. Commonwealth Edison (ComEd), based in Chicago, partnered with Opower to use its new Facebook app to allow its customers to compare their energy use with that of their friends online (see Figure 3). One important difference is that ComEd is not using the Opower application as part of a time-sensitive competition, but simply as another tool that is generally available to customers interested in learning more about their energy use.
Games Without Data
In addition to applications that use real energy usage data to motivate customers to save energy, there are also many utilities using Facebook games, trivia contests, and sweepstakes without usage data in an effort to educate customers about energy efficiency and increase their engagement. Implementing this type of program is a relatively straightforward process, as application developers like Wildfire and Offerpop manage all the technical details while the utility simply enters information, such as energy trivia questions and prize opportunities. In fact, legal terms on Facebook make it a requirement to use one of these third-party application developers to run a contest on their platform.
Many utilities that use this type of Facebook game have seen a large increase in the number of fans that their company pages attract. Both ComEd and Southern California Edison ran online social competitions in the summer of 2012 and have more than 30,000 Facebook Likes each. In addition, ComEd developed seven video games that customers can play on Facebook that teach people about the electric grid and energy efficiency (see Figure 4).
PNM, an electric utility in New Mexico, created a Home Energy Shape-Up contest on Facebook during the summer of 2011. The goal of the contest was to find a new way to engage customers and raise awareness about the role that energy efficiency can play in helping them save money. The contest posed energy efficiency challenges to customers over a period of ten weeks, each with a different theme. This gave PNM the opportunity to post relevant tips and videos based on each theme. One of the challenges asked customers to submit photos of their biggest energy hog and make the case as to why they should be the customer to win a new energy-efficient dishwasher.
PNM held a raffle for a grand prize at the end for anyone who entered any of the challenges. The prize was a home energy audit valued at $500 plus a prize package valued at $500 containing energy efficiency products, including CFLs, LEDs, and a programmable thermostat. According to Melissa Leymon, senior program developer at PNM, the utility was thrilled with the results. At the start of the competition in June, PNM had 330 Likes on its Facebook page. By the end of the campaign, PNM had more than 2,000 Likes. Facebook post views and post feedback both increased by almost 200%.
PNM learned that posting pictures of contest winners helped to increase customer engagement and participation. The utility also found that it was effective to start with small challenges and rewards leading up to a grand prize to keep people interested. Finally, using physical prizes, such as power strips and programmable thermostats, rather than gift cards for these items, ensures that the recipient actually has the energy-efficient device rather than relying on him or her to make the purchase. This approach is especially important for regulated utilities that must make their case to regulators.
E Source 2011 Benchmark Study
“Review of North American Electric and Gas Company Websites: 2011.” Kim Burke and Stephanie Spalding. E Source, September 2011.
Do Facebook Likes Equal Customer Engagement?
Likes on Facebook do not always equal happy customers, but it is encouraging that people are becoming more engaged and are joining a conversation with their utility. It’s important to manage expectations as to the savings that utilities and their customers can achieve from these games and contests. No one contest or game will completely change people’s behavior and compel them to use energy more wisely. The old marketing adage remains true: People need to hear a message many times before they take action.
Another big unknown is whether customers’ energy-saving behavior will persist. However, by leveraging social media channels to help get their message across, utilities can take charge of the message and educate customers about the importance of energy efficiency. In this way, utilities will play a more active role in instilling new conservation and efficiency norms in the population. Engaging customers more will lead to increased participation in energy efficiency programs and ultimately, to a better customer experience.
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