How to talk to a customer, if you have to

Is a messaging platform for customer engagement useful?

Phil Carson | Jan 15, 2012


A few, seemingly contradictory trends abound in the power industry which make customer engagement a generational challenge for utilities.

Surveys show that the general public doesn't have a fixed notion of what "smart grid" means, which may or may not reflect the fact that individual utilities approach that grab-bag phrase in disparate ways. Yet a very small cadre of metering opponents have managed to affix the adjective "controversial" to that elusive term, "smart meter," a trend that grabs media attention.  Interval meters obviously have a variety of potential uses and whether they serve the utility or the customer or both often remains an open question even after installation, though regulators are catching up to demand tangible value for the ratepayers who foot the bill.

Another pertinent angle in these cross currents is that every utility truly has its own technical and cultural heritage with its own regionally flavored customer demography and approaches the future with its own morphing business case and a technology roadmap to support it. In addition, each utility has its own approach to communicating with the public, ranging from "flying under the radar" to "tell them only what they need to know now" to total transparency.

Some utilities have yet to embark on grid modernization and have the luxury of deciding whether, say, distribution automation makes more sense than advanced metering infrastructure (AMI). They can plan their customer communications accordingly. Other utilities leapt ahead with AMI, courtesy of federal matching funds distributed under the American Recovery and Reinvestment Act, and, if they didn't get the customer engagement piece, have to retroactively develop a plan. The latter may well have successfully installed meters and supporting infrastructure but have yet to deliver programs with tangible customer benefits. Others may be piloting dynamic rate programs and are figuring out what the heck to tell their diverse customer base to promote uptake and how to convince consumer advocates that low-income and elderly customers can be protected.

So, "one size doesn't fit all" as the cliché has it, certainly points to the usefulness of a messaging platform that can provide building blocks that, on an a la carte basis, can aid any utility in addressing its own set of circumstances.

In fact, as many readers know, last summer the Demand Response Coordinating Committee, now the Association for Demand Response and Smart Grid (ADS), released a communications "umbrella" under the National Action Plan to offer those building blocks and the logic by which to select them. (See "Customer Service in a Smart Grid World.")

I honed my own sense of this issue after chatting with Judith Schwartz, principal at To the Point, who worked on last year's communications "umbrella" and who moderated a webcast last week on aspects of consumer engagement. It appears that enough customer-related research exists to provide guidance for utilities that wish to tap it.

Consider the moving parts that make the availability of a messaging platform with an a la carte approach useful. On the utility side, business cases vary. Deployment sequences vary. Executive and regulatory outlooks at each utility vary. On the customer side, uptake of new programs and technologies also vary. That continuum often is described as having innovators, early adopters, early majorities, late majorities and late adopters. Customers' motivations also vary and research has identified those by-now familiar groups such as technology enthusiasts, green altruists, cost-conscious customers, comfort lovers, those who are indifferent to all this jabber and my favorite group, resisters.

Last week's panel pointed out that it's possible to leverage these variations in different combinations to effectively communicate value propositions favorable to utility operations and, possibly, appealing to customers as well.

Bottom line: enough research exists for utilities of all stripes at different stages to being both short-term, tactical communications and long-term strategic outreach to bring their customers along in a transparent, cooperative effort. And, in fact, in progressive instances across the country, that is indeed what is happening.

In my view, there's a several-step process in play for utilities as their forward-facing business plan dictates their technology roadmap: gain or regain stakeholder trust, outline and implement a generational outreach effort and, within that framework, determine the tactical programs that answer short-term needs. There's plenty of research on how to match messages to value propositions that appeal to a diverse customer base.

For utilities that don't understand that they are proposing generational changes in customer engagement and behavior and that affecting that change will require a new way of doing business, let the bill stuffer be your epitaph.

Phil Carson
Intelligent Utility Daily

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SGCC Consumer Pulse and Segmentation study - wave 2


Great article Phil, I agree with your thoughts (love the epitaph analogy). Speaking of how to talk to customers, SGCC recently completed wave 2 of our series on understanding consumer attitudes and thinking about the smart grid. Seven benefits were tested to determine which ones consumers feel are most/least important.  All seven benefits are considered important by at least 80% of consumers. Continued low awareness is a cause for concern: only 50% of people in our survey have heard of the term smart grid or smart meter.  On balance, increased knowledge, even when both positive and negative messages are presented, appears to strengthen support for smart grid development. Based on data from the first wave of Consumer Pulse research, the SGCC segmentation framework divides consumers into five distinct segments that are defined holistically in terms of attitudes, values, behaviors, motivations, lifestyles, technology adoption, etc. – as they relate to Smart Grid issues.  The segments react very differently to smart grid concepts, products and services. Levels of interest in energy management range from “yes, definitely” to “no, thank you.”  Our bottom line is that consumer education should proceed quickly, and the message should vary by broad categories of consumer values, also known as consumer segmentation. Wave 2 research findings will be available on our website Monday January 23rd. 

Patty Durand

Executive Director
Smart Grid Consumer Collaborative


In fact, the utility monopoly is being threatened, even if the public hasn't yet caught on.  If solar PV prices continue to fall and someone comes up with a cheap enough battery, consumers will begin leaving the grid in droves.  In California, Governor Brown's push for 12,000 MW of rooftop solar is likely to help things along.

Of course, utilities aren't wholly responsible for their consumer-unfriendly attitude.  So-called consumer advocates who insist on making electricity a social service and an entitlement, and regulators who abet the consumer advocates and insist on one-size-fits-all solutions bear some responsibility as well. 

Jack Ellis, Tahoe City, CA

Fail to Plan, Plan to Fail

As usual, Phil, a great article with a succinct conclusion. Utilities must do a much better job of sharing their smart grid projects, from strategic planning at the outset that incorporates community leaders and consumer use cases, to addressing security, privacy and health concerns (notwithstanding hysteria - see previous comments), to showcasing the rationale for a comprehensive system modernization effort, of which smart meters are but one component.

There remains too much ignorance in this "debate," which should have much less controversy and much broader participation. Simply put, way too many utilities continue to operate like monopolies, as if their constituencies did not have alternatives to grid power or a say in the future of their regional electricity economy. Smart utility managers will act as regional smart energy subject matter experts, educating their constituencies (consumers, community leaders, local governments, regulators, etc.) on the complex task of modernizing our fundamental energy infrastructure, stressing a balanced view of both benefits and costs, and putting risks in the appropriate context. Silence only leaves room for miscreants to step in to fill the gap, as we have seen since Bakersfield in 2009.

John Cooper, President, Ecomergence