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How Consumers Energy Innovates With Successful Small Business Marketplace

image credit: Joseph Wadel of Consumers Energy
Rakesh  Sharma's picture
Journalist Freelance Journalist

I am a New York-based freelance journalist interested in energy markets. I write about energy policy, trading markets, and energy management topics. You can see more of my writing...

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  • Apr 11, 2019 2:15 pm GMT
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Digital initiatives are becoming an important part of the marketing and support initiatives for most utilities.

In recent times, Consumers Energy's small business marketplace targeted at small businesses has been a notable success in this field. The Michigan-based utility launched the program last year and it won the Association of Energy Professionals (AESP) Energy Award for Non-Residential Marketing award this year. 

The program is self-service and reaches out to small businesses through an assortment of digital tactics, including online chat, social media and e-commerce initiatives. It is cheaper as well. It cost approximately one-thirds less than the amount used to implement a similar energy savings program through a traditional small business. The online small business marketplace achieved its annual order goal in six months and energy and gas savings within the first nine months. 

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I connected with Joseph Wadel, manager of customer and industrial pilot programs at Consumers Energy, to know more about the program and its implementation. Our email interview below has been lightly edited for clarity. 

How does Consumers energy reach out to businesses? What was the trigger and thinking for the current outreach? Did you consider other media, besides online, to reach out to small businesses?

We reach out to businesses in various ways, from advertising to direct email to providing them with free energy audits that help them directly. We always are looking at new methods to help build awareness of how we can help them. By introducing the online marketplace, we were able to cost-effectively reach the traditionally hard-to-reach small business and rural market.

Extensive cross-program participation was built into the marketing and promotion strategy. This user-friendly marketplace is primarily marketed digitally via email and targeted social media ads, with high-converting inbound traffic from blogs and downloadable content. Rebates are applied instantly and shipping is free. It provides an opportunity for even the smallest small businesses, or those in remote areas, to participate in an energy efficiency program. The marketplace has helped Consumers Energy efficiently serve businesses in every corner of the service territory, achieve savings and improve customer service.

What are some problems that utilities typically encounter in communicating with small businesses? How are these problems different from the ones you encounter while conducting an outreach to residential customers? 

The biggest challenge with small businesses is that they are busy. Business owners sometimes lack the time and resources to devote to managing their energy use, so we go the extra mile to show them how our programs benefit their bottom line. They need convenient options for program participation. With instant rebates, the Marketplace was designed to help address the length of time to receive rebates, and the fact that the store can be easily accessed anywhere and by any device increases convenience. Other challenges with the existing small business programs have been that awareness of energy savings opportunities doesn’t always lead to action and cross program marketing and knowledge is limited. This Marketplace fills an important gap to move those customers who may not be interested in our Small Business Assessment or Direct Install programs to still achieve energy savings through the convenient purchase of “do it yourself”-style upgrades.

How receptive was senior management to your initiative? How does the project fit into the overall digital marketing matrix at Consumers Energy? 

Our senior management understands and supported this project because they appreciate the role that small businesses play in helping us reduce energy use across our entire customer base. We collect real user data through heat mapping and A/B testing of emails, which influences campaign messaging, design, and targeting. We use a growth driven design process to identify program design changes such as adding new products to the marketplace and enhancing the overall user experience. We also use nurture messaging and campaigns to keep the customer engaged with the Marketplace such as abandoned cart emails and follow-up emails with related products.

Consumers Energy realizes the importance of a digital strategy within its marketing plan, and welcomes digital marketing such as targeted behavioral driven emails and demographically targeted sponsored social media. 

What are the online outreach media (social media, SEO, website etc.) that you use to reach out and which ones do you find most effective? How big is your team and do you plan to expand it in the future? What metrics do you use to evaluate the project's success/failure rates?

We primarily market the Marketplace digitally with paid social media ads, and emails. Our emails promoting special offers on energy-saving products have proven to be most effective marketing tactic in driving online orders, more so when layered with targeted social media ads in an integrated campaign. We measure these digital campaigns with benchmark open, clickthrough and conversion rates. The program’s success is based of natural gas and electric savings goals. Our team currently consists of two program managers, a marketing manager and a team of designers to support campaign development as well as maintenance on the e-commerce site.

Considering that utilities are focused on and plan for long-term initiatives while digital marketing require a strategy that is constantly changing, was there a learning curve involved in training or adjusting team expectations at Consumers energy? 

The Consumers Energy Marketing department has welcomed a digital focused strategy for this new customer offering. There was a testing period to show proven analytics and a track record for best practice digital strategies that may have not been the utility’s normal process.  The Marketing department has developed a trust in this best practice and welcomes new suggestions to better enhance the customer experience.

E-commerce platforms like Amazon and eBay have products that are similarly priced as the ones on your site. Do you consider them as competitors? Why/why not? 

We’re focused on our own customers. Consumers Energy is a Michigan-based company, and our entire customer base is in Michigan. We’re trying to take steps that help our customers best and build on the trust that our customers place in us.

That said, we do compare ourselves to Amazon, mainly as a benchmark for success. It’s fast and free shipping is what our customers have come to expect from an online retailer. Amazon has also set the precedent for exceptional customer service. Our goal has always been to provide our small business customers with “an Amazon experience” in this marketplace and the team has done a great job providing that. We measure customer satisfaction monthly using a survey delivered via email. Customer comments have praised the ease of use of the Marketplace, fast shipping and low prices. This feedback was all verified in our formal evaluation process.

What are some reasons, besides product discounts, for small businesses to purchase products from your e-commerce platform? 

We try to create value for our customers with the products and services we offer. They also should know that when they contact us, that they can depend on us, if they have additional needs.

What are the benefits of a digital outreach like this for utilities?

Digital outreach allows us to meet our customers where they are. We can’t wait for customers to come to us if they have a problem – we want to build awareness and connect with them to show how we can meet their needs. Consumers Energy Marketing set up clear guidelines for our project team and others, to ensure customers are receiving prioritized messaging, at the appropriate time.

Rakesh  Sharma's picture
Thank Rakesh for the Post!
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Matt Chester's picture
Matt Chester on Apr 12, 2019

I love seeing how they reach their customers and how they measure their success: "Our emails promoting special offers on energy-saving products have proven to be most effective marketing tactic in driving online orders, more so when layered with targeted social media ads in an integrated campaign. We measure these digital campaigns with benchmark open, clickthrough and conversion rates. The program’s success is based of natural gas and electric savings goals. Our team currently consists of two program managers, a marketing manager and a team of designers to support campaign development as well as maintenance on the e-commerce site."

 

Great interview, thanks to both Rakesh and Joseph for the insights

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