Saving summer – why Powershop wants to sell less power
Every year, come the peak of Australian summer, homes and businesses are sapped for electricity. Here’s how Powershop mobilised its customer base to give a little back to the Victorian power grid.
This article originally appeared in The Truth Issue, Marketing‘s first print edition for 2019.
Campaign: Curb Your Power
Agency: Of Character
When demand for energy is at a high it puts a lot of pressure on the grid because we can only generate so much energy for all that usage – think fourth day in a row in the high 30s, when everyone has the air-conditioning blasting. That’s when you have the potential for situations like blackouts.
Blackouts are definitely annoying for most people, but for many it can also have serious consequences – blackouts can damage stock or hurt trading if you’re a business and, even worse, put people at risk if they rely on power for their health and well-being. There are a lot of issues around blackouts that can be caused by this high pressure on the grid.
To be able to avoid that, there are two options: the government could make very costly infrastructure investments to manage those three or four times a year when it is that hot, or people could just take the situation into their own hands. The latter would be a simple matter of using just a little bit less power at those peak demand times – which would avoid the need for excess infrastructure investment and reduce the risk of blackout incidences.
Powershop saw it as an opportunity for the brand to get involved – it knew it had very active customers. Also, a campaign addressing this problem would align well with Powershop’s brand and ambition – to change the energy industry for good. This was particularly true given data from 2017 showing trust in the energy industry was extremely low, to the point where energy providers were trusted even less than banks. This would serve as an opportunity to remind people why Powershop is a difference in an industry riddled with trust issues.
The campaign was set to launch for the first time in the summer of 2017/2018. Powershop was talking to its Victorian customers – households and businesses – aiming to get 10,000 people to agree to take part in a program that would lower stress on the grid during peak energy usage periods.
Though from a marketing perspective this was an engagement campaign, it would hopefully also be a fantastic retention tool as well. Not only would Powershop be doing a service to the entirety of Australia’s energy grid and the environment, but it would also help develop a channel to get the brand’s purpose and mission out there.
This campaign was just one of those things. It aligned so well with its brand that Powershop would have tried it regardless. As it turned out, however, there was an appetite for a program like this in the market. Powershop’s research of Australians – not just Powershop customers – showed 78% think it is very important that the energy industry is constantly innovating given the pressure on the environment, while 85% of Australians think energy companies need to innovate to help release pressure on prices.
Those two facts are, in a way, part of why Powershop seeks to be a better power company – better for customers, better for their hip pockets and better for the planet. Victoria was chosen to pilot the campaign because the smart meters are a standard, which means Powershop is able to show its Victorian customers their updated power usage every 30 minutes.
Because a program like this has never really been done in Australia, it needed a bit of space to explain the how, the why and the impact. Powershop customers would sign up to the ‘Curb Your Power’ program, then when it looked like the grid was going to need a bit of breathing room – the Australian Energy Market Operator (AEMO) would notify Powershop – they would receive a message letting them know a ‘Curb Your Power event’ would be occurring soon.
If participants managed to curb their usage by a certain amount they would receive a $10 power credit to redeem on their next bill – targets were dependent on the type of user, whether the user was a business or residential one, whether the user had solar panels installed and so on. Powershop would also send out tips and examples of ways to decrease power usage, particularly on hot days.
Powershop used EDMs (electronic direct mail) to its database as its key channel for recruitment. This meant it could provide videos on why people should be involved, how they can take part and what the impact will be. It also used a lot of blog posts – some of which talked about the company’s trial ‘curbs’, where Powershop would ask staff to do challenges, experiment and report back with how they managed to curb their power, then document that in blog posts. Online content was key in terms of recruitment; Powershop also used digital and social to target current customers, which had the nice effect of scooping up new customers along the way.
One challenge for the Powershop team was that they had no idea if they would be able to pull it off. The program relies greatly on being able to measure a baseline of someone’s energy usage, and also being able to measure during a particular time period. How do you figure out if someone has curbed their usage by 10%? Then how do you make sure that they actually did it and it wasn’t a false negative? And, of course, how do you make sure that participants that do reach their target are rewarded appropriately? So the data behind the scenes was incredibly maths-heavy and involved some really complex data science – relying on weather calculations and average energy usage calculations etc.
Powershop also wanted to make sure people knew what they were doing and how to curb power safely. That last thing it wanted was for someone who really needed to rely on energy to be healthy to take part in this.
The recruitment objective was to get 10,000 Victorian households and businesses to sign up to Curb Your Power – which the campaign ended up surpassing. As a group over the summer there were three power-curbing events. During them the program provided 16.8 megawatt hours back to the grid, which is the equivalent of four average households’ energy for an entire year.
Of those that did sign up to the program, 65% of participants managed to achieve their targets. In terms of reducing usage by 10%, not everybody was able to do it – either because they weren’t there or because they didn’t take part during the events. After each event, Powershop sent out a survey to see why people decided to participate. The response was overwhelming: people wanted to help the grid.
The assumption was that most people would say ‘because I wanted the saving on my power bill’, but upon looking into it, Powershop discovered that its customers genuinely liked being part of a group that was doing good. The money was a nice high-five at the end, but not the primary driver.
As the weather heats up, Powershop is now onto planning for its next Curb Your Power series of events. Running a randomised, controlled trial for the recruitment phase, Powershop is testing five different messages in sample markets to further drill down on the best way to engage people in the program. What’s the best incentive? Is it money? Is it the greater good? Instead of some financial incentive, would people be interested in having their reward be a charity donation where Powershop chips a bit in too? We’ll see.
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