Is Nudging a Cost-Effective Solution to Promoting Energy Efficiency?

by Sam Zastrow, Low Income and Online Market Manager 

Promoting energy efficiency behaviors and programs could be as easy as a nudge. A nudge is a subtle way of influencing behavior without offering material incentives or imposing punishments. Many utilities are already nudging their customers towards improved energy efficiency through their energy bills.  Including comparison information for homeowners – whether comparing a homeowner’s energy use to their neighbors or an average customer  - often causes ratepayers to reflect on their own actions and motivates improved home energy efficiency.

“When you get a bill with a long list of numbers, it’s unlikely to mean very much to you. But if you see you’re using much more than your next door neighbor, let’s say, it suddenly becomes personal,” says David Halpern, director of the Behavioural Insights Team (BIT). Nudges exploit our desire to fall in line with the attitudes and behaviors of our peers, but they also appeal to policy makers and utility providers looking for cost efficient, energy education solutions. “Nudges appeal to policy makers because they generally don’t require huge investments and yet have the potential to make a big impact,” said Halpern in a recent CNN post.

Subliminal influences or nudges are not new, but they are gaining a new level of attention as they are used to influence more sustainable behaviors. Nudging is a cost-effective solution to breaking into habitual behavior, though it is not enough of a motivator for everyone, it can help motivate people to take a second look at their actions.

A recent CNN article, “Is a ‘nudge’ in the right direction all we need to be greener?” by George Webster highlights a few nudge examples to improve energy efficiency.

 Research has found that people are more conscious of their energy use when they can see it in action. Designer Muhyeon Kim has designed a power outlet that displays how much power it is using. If nothing is plugged into the outlet the light is off. When energy is being used by an appliance or electronic device plugged into the outlet, energy use is displayed and tracked in orange. If the appliance is using power in a standby mode, energy use is displayed and tracked in blue.

Eco Reminders, from hu2, are wall design reminder stickers and functional wall decals for energy and water savings.

Deliver results specific to your efficiency and sustainability strategies, goals and filings with energy efficiency education and outreach solutions from Energy Resources. We deliver expertise in energy efficiency:

• Education, Outreach and Event Marketing
• Speakers and Workshops
• Social and Content Marketing
• Program and Channel Management
• Lead Generation, Program Sign-up and Surveys
• Hispanic and Latino Education and Outreach
• Low Income Education and Outreach

Contact us to develop an energy efficiency education and outreach strategy relevant to your energy, rate, energy efficiency and renewable programs and products. 

Four Social Media Benefits for Utilities

by Sam Zastrow, Outreach and Education Market Manager 

According to a recently released Pike Research consumer survey it is estimated that “57 million customers worldwide will use social media to engage utilities in 2011 and that number is expected to rise to 624 million customers by the end of 2017”. The Social Media in the Utility Industry Consumer Survey by Pike Research found four key social media benefits for utilities:

1.) Informing customers about changes to pricing and billing

2.) Educating customers and keeping them informed about new products and services

3.) Addressing questions and allowing for a “virtual” conversation with customers

4.) Reaching certain demographic groups

By conducting a web-based survey of 1,051 consumers in the fall of 2011, using a nationally representative and demographically balanced sample, Pike Research defined the current use of social media, utility social media interactions and opportunities for future utility interaction through social media. Here’s what you need to know about the four key social media benefits for utilities according to the Pike Research Social Media in the Utility Industry Consumer Survey.

1.)  Informing Customers About Changes to Pricing and Billing

Informing customers about changes to pricing and billing is a challenge for every utility and the thought of communicating those changes through social media often makes utilities cringe. Social media allows for a real-time, dynamic conversation between energy users and their utility, but participating in the social media conversation forfeits your ability to control the message.

Lack of control over the message often steers utilities away from adopting social media, but regardless of utility involvement in social media their customers are going to tweet, like and post through social media. The Social Media in the Utility Industry Consumer Survey explored the reasons why utility consumers interact with their utility through social media.

“As shown in Chart 3.6, billing issues and obtaining information about a utility service or program (both 32%) were the two reasons that consumers communicated with their utility through this channel.” 

“Notably, one-quarter of respondents used social media to compliment the utility about its service. Customers also reached out to their utility through social media services because of a service outage (19%), a service issue other than an outage (16%), and to schedule a new service installation (15%).” The utility/customer social media conversation is not entirely negative. Social media can be an outlet for addressing changes in pricing and billing, while sharing positive feedback and meeting new service interests.

2.)  Educating Customers and Keeping Them Informed About New Products and Services

Of the Pike Research respondents who use social media to interact with their utility, 31.5% used social media to obtain information about utility service or programs. Utility adoption of social media provides another communication channel to promote energy efficiency program benefits, information about new programs and program updates.

 

According to Social Media in the Utility Industry Customer Survey results, “those respondents with high electric bills (in excess of $300 per month) were more likely to use social media to interact with an electric, gas, or water company. In terms of technology adoption, only those respondents who identified themselves as early adopters had a higher-than-average level of communication with their utility through social media services.”

With a variety of social media networks and communities available, where should a utility invest in social media? “As Chart 3.4 below shows, Facebook was by far the most popular social media site for interaction with a utility, used by 75%, of respondents. Lagging far behind was Twitter (27%), YouTube (23%), and LinkedIn (15%). Interestingly, more than one-fifth of respondents report using the utility company’s blog site.”

3.)  Addressing Questions and Allowing for a “Virtual Conversation” with Customers

Establishing your utility voice as an energy efficiency expert and addressing customer concerns promptly improve your credibility and ability to address customer concerns. Increasing utility communication through social media with ratepayers to address concerns, help them save money and promote energy saving programs builds a relationship and allows for increased dialogue between ratepayers and their utility.

“Survey respondents were also polled on how often they interact with their utility using social networking and media services. As Chart 3.5 below shows, nearly 60% of respondents interact with their utility “very often” or “regularly.” This is an encouraging sign, indicating that consumers who pursue a social media relationship with their utility are likely to engage with the utility on a frequent basis.”

Developing a virtual conversation with ratepayers allows utilities to continue the energy efficiency conversation beyond monthly bill inserts, commercials or other forms of promotion.  Social media provides an outlet for utilities to build a relevant and meaningful connection with the communities they serve, through the online communities they regularly engage in.

4.)  Reaching Certain Demographic Groups

Current social media users revealed little variation in usage by education level. According to the Social Media in the Utility Industry Consumer Survey, “those with high school degrees, those with some technical school/college, and those with 4-year degrees tend to use social media services more than respondents with less than a high school degree, a 2-year degree, or a graduate degree. Some minority groups, particularly Hispanics (80%), African Americans (74%), and Asian Americans (73%), report higher levels of use.”

Social media use will continue to provide a diverse audience in several demographic categories including: education, income, gender and ethnicity.“In terms of demographic segmentation, there was no noticeable degree of variation in responses by education level, gender, age, or income. Across the various ethnic groups, however, Asian Americans, African Americans and Hispanics were more likely to state they plan to interact with their utility via social media in the future.”

Conclusion

Despite some uncertainty about the future of the social media conversation between utilities and energy consumers, the Pike Research Social Media in the Utility Industry Consumer Survey indicates future growth in customer/utility social media interactions. Pike Research outlined four key benefits for utility social media use and an increased online dialogue between ratepayers and their utility.

At Energy Resources we believe in empowering customers through education, engagement and a call to action. We offer expertise in energy, communication and conservation marketing:

• Outreach and Event Marketing
• Speakers Bureau
• Social and Content Marketing
• Program and Channel Management

Contact us to develop communication, education and outreach solutions that deliver results specific to your conservation and sustainability strategies and goals. Or email me, Sam Zastrow, sam@energyresourcesmn.com to learn more about our consulting and marketing services.