While many electricity providers have become significantly more customer-centric in recent years, how receptive have consumers in the United States and Canada been to this evolution? Are consumers engaging with their providers’ efforts? Are consumers effectively finding new ways to save energy or access clean energy sources?
These are some of the questions that the Smart Energy Consumer Collaborative (SECC) looked to investigate with the “Modern Customer Engagement Journey” study. This unique research project is based on more than 30 on-camera video interviews with consumers in the United States and Canada and was developed as a companion to 2019’s quantitative “Consumer Pulse and Market Segmentation – Wave 7” report.
With this research, we wanted to delve into what consumers really think about energy, their electricity providers, climate change and more amid the unprecedented circumstances of 2020. While not statistically significant on its own, we wanted to hear from consumers in their own words what they find challenging about saving energy, what they like most about smart energy technologies and what their goals, motivations and values are around energy.
Based on these in-depth consumer interviews, here are five key insights on energy consumers today:
1. There’s interest in smart energy technology across all segments interviewed.
For these video interviews, we talked to consumers from the Green Innovators, Tech-savvy Proteges and Movable Middle segments, which account for about 75 percent of all consumers, and excluded the Energy Indifferent segment, who tend not to want to engage in energy. Across the three segments that were interviewed, we noticed that consumers are increasingly engaged with energy-enabled products and that smart home devices – including speakers, thermostats, refrigerators, light bulbs and smart plugs – are particularly interesting for consumers.
While consumers in the Tech-savvy Protege segment unsurprisingly lead the way in technology adoption, Green Innovators and Movable Middle consumers alike expressed considerable interest in smart home devices. One consumer in the Movable Middle segment noted that he had already purchased three Alexa smart speakers and smart TVs for his home and was currently in the market for both smart plugs and a smart thermostat. According to this consumer, he had begun “dipping his toes into smart home technology” and intends to do more.
These findings suggest that smart home devices have moved beyond the early adopter stage and are now mainstream technologies. This coincides with market research stating that smart speakers are the fast-growing consumer technology of the modern era and that nearly 90 million Americans now have at least one in their homes.
2. After getting a “gateway” smart home device, there tends to be an appetite for more.
This Movable Middle consumer exemplifies another key characteristic related to consumers and smart energy technologies: the purchase of one smart home device tends to spark an interest in further home automation. Typically, the first device is a smart speaker – such as the Amazon Echo and Google Nest Hub – and this first device is often driven by an interest in technology and the product’s “cool factor”.
Once consumers are comfortable installing a smart home device and connecting it to their home network, they seem to quickly begin thinking about what they can purchase next. For example, one consumer in the Tech-savvy Protege segment noted that his girlfriend had purchased a smart speaker and that now they are looking a smart thermostat, home monitoring system and a smart TV.
We also asked consumers about the satisfaction level with the smart devices that they own and found that there tended to be little disappointment among the set of consumers interviewed. While not a statistically significant finding on its own, these devices seem to be working as expected, and consumers value the control these technologies give them over their homes and their energy consumption.
3. Saving energy is often top of mind when consumers are moving for upgrading technology.
In these interviews, we also investigated how and when consumers tend to save energy at home. While many consumers noted that they often make small adjustments as part of their everyday routines (e.g., turning off the lights or adjusting the thermostat), larger investments in energy efficiency often come when consumers move or when current appliances breakdown or become otherwise obsolete. One consumer in the Green Innovators segment noted that he was looking at adding rooftop solar, higher efficiency heating and cooling, and smart lighting as part of a major home renovation.
Consumers tend to want to take advantage of occasions where they’re already in the process of making changes, to purchase new, energy-efficient technologies that will lead to savings over time. Consumers also noted that a move would cause them to reassess the opportunity to make everything in their home smart rather than just one or two devices or appliances. Industry stakeholders can use these moments in the customer journey to help consumers acquire more efficient and smart devices and meet their home energy goals.
4. There is a lack of awareness of energy-saving programs from electricity providers.
Among the consumers we interviewed, we found a lack of awareness of programs and services from electricity providers among the segments interviewed. This finding coincides with SECC’s quantitative research, which has typically found low awareness and understanding on energy issues, programs and services – from energy efficiency and alternative rates to electric vehicles and renewable energy. Consumers are often not aware of the programs and services available to them; however, once educated on their options, consumers express considerable interest.
One consumer in the Tech-savvy Protege segment noted that electricity providers “could be more
transparent with how they’re billing you and what you can do to lower your bills”, and one Movable Middle consumer stated that they have not really heard anything from their provider about how to save energy at home. As noted in SECC’s “2020 State of the Consumer” report, education and transparency remain key opportunities for electricity providers and other industry stakeholders.
5. Consumers are most concerned with cost savings from programs and investments.
Finally, consumers were clear about wanting to better understand tangible cost savings from programs and services and the need for more transparency from electricity providers on savings. Consumers stated that upfront costs are off-putting and that they need help making larger purchases and that they do not have tools to assess how products and programs will impact energy consumption – all of which are echoed by findings from SECC’s quantitative research.
One Canadian consumer in the Movable Middle segment stated: “Did I really see a difference in my hydro bill? No, I didn't see any big changes. Even though they told me I probably would, I really didn't see a change.” Consumers are often unable to delineate whether they have actually saved and need more transparency from their electricity providers on the impact of programs and investments. Stakeholders should offer consumers shadow billing, usage data access, bill calculators and other instruments to bring more clarity on savings potential for energy technology investments.
The new “Modern Customer Engagement Journey” research provides a qualitative look at American and Canadian consumers during this unprecedented, challenging year. We hope this information will help industry stakeholders hear the voices of consumers in all their diversity, and we encourage stakeholders to apply this knowledge as they design products and services for consumers and communicate the benefits of smart energy.
Watch the videos from the “Modern Customer Engagement Journey” research on YouTube, and download a topline report here. Access the companion “Consumer Pulse and Market Segmentation – Wave 7” research here.