Unleashing Business Value in a Digital World - The New Energy Consumer - Accenture
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The New Energy Consumer Unleashing Business Value in a Digital World
Contents Introduction 3 Forces shaping the energy marketplace 4 Unlocking the digital value of the new energy consumer 14 Extending the value proposition 28 The digital energy platform (r)evolution 36 Thriving in the digital energy era 44 References 50 2 Contents
Introduction
Energy providers around the globe are operating in a whole new
world. Everything and everyone is increasingly connected. Energy
consumers are embracing innovative technologies and taking
on new roles as both buyers and sellers of energy. At the same
time, a host of threats—from traditional competitors as well as
new market entrants—are challenging utilities to become more
innovative and more agile.
In The New Energy Consumer: Unleashing Business Value in
a Digital World, Accenture shares the latest results of our
multiyear New Energy Consumer research program. Our findings
and analysis point to important shifts and highlight growing
opportunities for forward-thinking energy providers. Above all,
they reinforce the importance of the digitally engaged consumer
and the need for energy providers to stake their claims in the
digital energy ecosystem.
The New Energy Consumer: Unleashing Business Value in a Digital World 3
Forces shaping the energy marketplace Electric, gas and water utilities are surrounded by change—from rapid advancements and widespread adoption of distributed generation and smart technologies to product innovation, game- changing partnerships and converging markets. At the same time, consumers’ values and preferences continue to evolve. In the face of so much change, where will energy providers find new growth? How will they reduce costs? And what new approaches can they adopt to better serve consumers? While opportunities and challenges vary by region, every provider needs to take deliberate action—embracing a bold vision and reformulating strategies for understanding, reaching and engaging energy consumers. In doing so, it is crucial to keep a keen eye on four key forces shaping energy markets around the world: • Connected everything • Personalized energy • Asymmetric competition • Shifting regulatory frameworks 4 Forces shaping the energy marketplace
Connected everything
From wearable computers to sensors in sports clothing, the
physical world is coming online—altering how consumers live
and work and driving new opportunities for energy providers.
Everyday objects are being embedded The We Economy offers savvy companies
with sensors and combined with intuitive new strategies to compete and win
visualization, yielding new insights into in a digital world. It also offers rich
consumer habits and behaviors. A growing opportunities for businesses to collaborate
number of consumers are filling their with other players and consumers to
homes with connected devices and, in place bets—on new products, services and
some cases, they may not even realize it. experiences—that were not possible one or
Kitchen appliances, thermostats, lights, two years ago. Today, the We Economy can
locks, phones and televisions are becoming shape new markets at scale.
smarter and more interconnected. In fact,
almost all energy consumers now use some Connected everything has raised the
type of connected device in their day-to- bar, with consumers who now expect
day lives. Doing so offers easy access to choice, control and convenience. Leading
information, empowering consumers to energy providers are leveraging digital
make faster, better decisions on their own capabilities to meet those expectations—
terms. With smart devices, consumers can while strengthening consumer engagement
choose between being highly informed and and delivering tailored experiences that
influential or adopting a simple, effortless ultimately support long-term consumer
set-and-forget mindset. satisfaction. In the We Economy, winning
energy providers will be those that think
All the while, the digitization of everything and act differently. No longer relying on
is becoming a reality. The 2015 Accenture a single idea, technology or organization
Technology Vision cites organizations’ to achieve success, they will position
unprecedented leap forward in the themselves at the center of the emerging
journey to becoming digital businesses.1 digital energy ecosystem.
Together, such organizations are
creating a hyper-connected world—a
“We Economy”—in which companies,
consumers and everyday objects can
digitally interact with each other.
The New Energy Consumer: Unleashing Business Value in a Digital World 5
Personalized energy
As a broad spectrum of energy products and services becomes
interconnected, consumers’ awareness and needs are on the rise.
Ease of access and energy self-sufficiency While that world may still be in the future, Emerging platforms will likely facilitate
are becoming top of mind for consumers— the current reality includes declining direct transactions between energy
opening opportunities but also posing solar technology prices, new leasing consumers and distributed energy
threats for energy providers. and financing models to become power producers, such as homeowners with solar
self-sufficient, and growing adoption panels or farmers with wind turbines, who
Energy is reaching new levels of among consumers. Solar can be found often generate more power than they need.
convenience for consumers and energy is everywhere—across rooftops and awnings,
becoming less centralized, with consumers as well as roadways and in EVs. As solar In much the same way that Airbnb’s
tapping into non-traditional sources of grows in popularity, prosumers (those who platform disrupted the hospitality
energy. Evidence of personalized energy is not only consume but also generate and industry by directly connecting hosts and
everywhere—from the increasing consumer sell energy) are gaining critical mass. At the travelers, platforms will enable neighbors
adoption of home generation solutions same time, EVs are creating a new breed to buy and sell power directly from each
via solar panels and electric vehicles (EVs) of prosumers who use energy services in other. As more energy solutions emerge,
combined with increasing battery storage various places and in varying quantities. consumers may shop around for the best
to the emergence of microgrids. Some refer From an energy provider’s viewpoint, EVs deal on their electricity, especially if local
to this as the “democratization of energy” represent an opportunity to increase load generation offers a more compelling value
and anticipate that, in the future, the and revenue generation while extending proposition. Utilities have an opportunity
majority of energy will be generated in the reach beyond the home. to decide whether to participate and
home with only back-up needs and large what role they will play in maintaining
industrial power being produced centrally. As digital technologies are increasingly platforms or otherwise facilitating these
applied to the energy infrastructure and local, peer-to-peer transactions.
With personalized, convenient energy top prosumers adopt distributed generation
of mind, retailers are getting into the act: and storage solutions, grid technologies For energy providers, the prosumer
IKEA now offers a line of wireless charging will become increasingly more distributed. segment is quickly advancing from simply
furniture that lets consumers charge Utilities executives are expecting to an interesting concept to a multifaceted
their smartphone by simply setting it on see greater growth in the development reality. As more consumers become
their desk,2 while BirkSun has equipped of microgrids in the next five years. In power generators and the traditional
backpacks with a solar panel for charging 2014, the number of utilities executives one-way flow of power becomes bi-
cell phones.3 Energy consumers on the expressing that view nearly doubled to directional, more complex and interactive
move in San Francisco and London have 66 percent from 35 percent in the 2013 relationships with consumers are required.
the ability to charge their smartphones survey.6 However, according to The New
wirelessly at their local Starbucks coffee Energy Consumer: Unleashing Business In short, all consumers have opportunities
shop.4 There is also a new technology that Value in a Digital World, consumer to play a more dominant, pivotal role
can turn any window or sheet of glass into knowledge of microgrids is low: two-thirds in the energy ecosystem. They enjoy
a photovoltaic (PV) solar cell—suggesting of consumers do not know what a microgrid growing choice around the source of their
a not-too-distant world in which new is. Engaging prosumers to advance electrons—wind, solar or even landfill
homes and office buildings, new cars, and their knowledge and understanding of generation—and, in competitive markets,
even new smartphones and tablets could distributed energy resources will become they can select their energy provider.
generate their own energy.5 increasingly important as these solutions Personalized energy will continue changing
are proliferating. With companies such as how consumers interact with utilities and,
Alevo7 offering battery back-up systems, ultimately, how a utility runs its business.
Tesla’s Powerwall Home Battery with
7kWh or 10kWh of storage, and the
100kWh Powerpack can only serve to
accelerate energy storage adoption.8
6 Forces shaping the energy marketplace
The New Energy Consumer: Unleashing Business Value in a Digital World 7
Asymmetric competition
What energy provider would have anticipated competing
with Apple or Google for consumer mindshare around
home energy management?
For core energy and new products and platform, these new companies deliver By nature, digital startups benefit from
services, energy providers now face a modern experience, offering energy the proverbial clean slate. Able to design
competition from all directions—startup packages consumers value—and their internal operations and processes around
digital retailers, telecom giants and significantly above-average customer consumer needs, they can choose where,
prosumers, as well as incumbent utilities. satisfaction scores validate their when and how to automate transactional
In some markets, incumbent providers innovative approaches. processes. In addition, as new energy
have adopted a strategy to pursue a dual- retailers, they avoid many of the overhead
• Solar solution companies are offering
fuel bundle offering consumers extended costs borne by a traditional utility. This
compelling value propositions to
products and services. However, with the lower cost of entry has made it easier
consumers that may require energy
cost of innovation at an all-time low, new for digital energy retailers to enter the
providers to innovate to deliver
players are entering both regulated and market. In the United Kingdom, for
renewable products and services in a new
deregulated markets: example, the number of retailers has been
way, such as offering community-based
growing, with some playing the market
• In a bid to capture the behind-the- solar services. The complexity of helping
by buying energy in the spot market
meter market, a growing list of consumers understand their energy
and then passing those savings on to
blue-chip vendors, including Apple, context will be compounded as more
consumers. Admittedly, not every utility
ADT, Google (after it acquired Nest), consumer-grade storage technologies
can be a pure digital retailer, but almost
Samsung, Verizon and Walmart, are become available.
every provider can learn from how these
partnering with incumbent hardware • New entrants in some competitive retailers interact with their consumers.
and software providers to develop markets are leveraging automated
home Internet-of-Things ecosystems comparison of retail versus wholesale
to usher in a new phase of home market prices to gain market share
energy management solutions.9 through robotic switching and collection
• A visit to Kickstarter10 reveals numerous switching services.
startup companies seeking funding for The playing field for these diverse
home entertainment/security systems, competitors is far from level, and these
smart house keys and a hands-free differences in capabilities and constraints
Voice over IP (VoIP) call recorder—any of within the market epitomize asymmetric
which could theoretically be connected competition. Although utility incumbents
to a utility-owned platform to deliver a have the edge when it comes to economies
simpler and better consumer experience. of scale and years of experience in refining
• Pure digital competitors, such as Bounce energy delivery, digital energy startups
Energy11 in Texas and Powershop12 in benefit from agility and risk tolerance and
New Zealand, may be unencumbered may not have responsibility for energy
by legacy investments and regulatory delivery. They are also well positioned to
requirements with which traditional take advantage of new technologies for
utilities must contend. Using a digital a seamless consumer experience across
digital channels.
8 Forces shaping the energy marketplace
In addition to threats from digital energy In Europe, Deutsche Telekom is testing
retailers, energy providers are now sparring its Qivicon product15—an open platform
with telecommunications giants, tech intelligent home automation system that
innovators and other competitors that can unite products from a number of
would have been unthinkable a decade companies, including electricity suppliers
ago. In the quest for consumers, these and manufacturers of household appliances
new entrants are offering a variety of and consumer electronics, as well as
energy and home management products producers of health-oriented solutions. The
and services—and leveraging consumer Qivicon platform creates a link between the
information to provide valuable insights various devices and functions that can then
and recommendations. Apple’s HomeKit13 be accessed through an application on a
and Google’s Nest14 are currently vying smartphone, tablet or computer.
to become the smart thermostat of
choice. They are pursuing this market not Asymmetric competition reflects a host
because controlling a home’s temperature of new and, in some cases, unexpected
is lucrative but because each wants to threats. For innovative energy providers,
become the platform on which all of a however, it also creates a market for new
consumer’s in-home interactions occur. products and services.
The New Energy Consumer: Unleashing Business Value in a Digital World 9
Shifting regulatory frameworks
Around the world, regulatory frameworks are being rewritten to
anticipate rapidly changing consumer and industry needs.
Regulatory bodies are facing continued infrastructure investment recovery. In In many markets, changing policies around
pressure to confirm reliability, security of response, many jurisdictions are driving price regulation, affordability and consumer
supply, energy efficiency, affordability and fundamental change through retail information transparency are driving
long-term market predictability. Among the market liberalization, alternative utility change. Competitive market structures are
key drivers of change: rising energy prices revenue models and performance-based continuing to expand globally. The journey
and higher consumer awareness; increased remuneration. While each country has to retail competition underway in a number
adoption of distributed energy resources distinctive priorities, common challenges of countries (see Figure 1) is bringing a
and the integration of renewables; and opportunities exist around the wave of change for consumers and energy
growing reliance on demand response; implications of the new energy consumer. providers alike.
the needs of the modernized grid; and
Figure 1. State of global retail competitive electricity markets.
Sweden
Norway
United Netherlands
Canada Kingdom
Ireland Finland
Denmark
Belgium Germany
France Czech Republic
Oregon Spain Hungary
Texas Austria Japan
Portugal
Northeast USA Italy South Korea
Malaysia
Singapore
Australia
New Zealand
Degree of competition
Low High Moving to competitive market
Source: Accenture analysis.
10 Forces shaping the energy marketplaceFor some, the journey is already may offer no more than four tariffs per In New York, regulators have undertaken
underway. For example, Portugal has fuel type and must inform consumers of the Reforming the Energy Vision (REV)
been implementing its competitive market the best deal. In addition, consumer churn initiative aimed at reorienting the electric
structure since 1995, and eliminated the or switching has increased in 2015 over industry and the ratemaking paradigm
regulated tariff to end consumers in 2013. previous years, with a larger percentage toward a consumer-centered approach
For consumers with contracted power up of customers who switched opting for that harnesses technology and markets.23
to 10.35kVA, a transition period is in place smaller players.19 This appears to be the The vision is to develop a “distributed
through December 31, 2015.16 Elements result of the changes and the proliferation system platform” to animate a market
of consumer engagement are yet to be of comparison sites that are making where distributed energy and traditional
determined; for example, how quickly and information consistently more transparent energy organizations can compete
to what degree prosumers will emerge, and to consumers. to promote system-wide efficiency
what will drive consumers to implement and reliability, regardless of preferred
energy-efficiency initiatives. However, the Another interesting development in energy source, and increase consumer
removal of the regulated tariff is consistent the United Kingdom is the evolution to knowledge of energy management.
with a well-functioning retail market principle-based regulation following a
in which customers can benefit from similar approach to the financial services Recently, the California Public Utilities
competition and innovation. industry. The regulator has introduced Commission (CPUC) revisited the approach
standards of conduct that require suppliers to plug-in electric vehicle (PEV) charging
While Japan is also ramping up its open, to treat their customers fairly. Energy infrastructure within its jurisdiction.
competitive retail market structure, it providers are accountable for implementing In December 2014, the CPUC endorsed
is much earlier in its journey. Japan is the principle, embedding fair treatment of an expanded role for the incumbent
considering allowing residential and small customers throughout their organizations.20 utilities in developing and supporting the
and medium businesses (SMBs) to choose PEV charging infrastructure. The intent
their gas suppliers by 2017,17 as well as While there are many benefits to a is to encourage expansion of electric
opening up electricity markets18 in the competitive market model for consumers vehicle-related infrastructure and the
hope of encouraging greener energy, and providers, distributed energy resources widespread deployment and use of PEVs.24
reducing costs and preventing future power and systems are fundamentally reshaping Further, Colorado recently introduced
shortages. Japanese energy consumers have competitive and regulated markets. As Bill 1250, which prioritizes developing a
shown interest in finding ways to reduce technologies advance and their price points performance-based regulatory system that
household energy use, save money on their become more palatable for consumers, will drive innovation and promote economic
bills and buy power from 100-percent pressure on existing systems is increasing. development in a variety of technologies.25
renewable sources. Deregulation will create Deutsche Bank estimates that rooftop solar
opportunities for new providers to help will reach grid parity in all 50 states in
customers meet these goals. the United States by 201621 and, by 2017,
grid parity will be realized in 80 percent
In the United Kingdom, the focus has of global markets.22 In response to rising
recently been on long-term consumer consumer adoption, the speed and scale of
value with the introduction of new market regulatory change will influence the long-
rules to simplify the choices offered term value available to both customers
to consumers and to increase price and energy providers. Multiple markets
transparency. The goal is to encourage around the globe are making fundamental
higher levels of consumer choice. Each of regulatory changes, affecting business and
the six large incumbent energy providers recovery models.
The New Energy Consumer: Unleashing Business Value in a Digital World 11As other jurisdictions grapple with Current regulatory activity demonstrates emerging technology, renewable energy that both the pace of change and the or approaches to electrifying rural approach will vary by jurisdiction. However, areas, we continue to see regulatory the power of the consumer to influence interventions. For example, as Germany the energy marketplace is universal. More learns from its experiences undergoing than ever, market structure developments an energy transition, it is now looking to are having profound implications on reforms to protect consumers and further the energy provider’s ability to maintain advance market innovation. Last year, the and enhance the consumer relationship, German government approved a sweeping as well as the strategies and business change to its well-known green energy models of the future. Leading energy transformation to reduce subsidies for providers are proactively engaging renewables and stem rising electricity regulators and a host of stakeholders prices. Under the plan, Germany plans to help shape the energy ecosystem. to meet 80 percent of its energy needs through renewables, while producers will gradually have to sell their green energy competitively on the market rather than enjoying regulatory protection.26 Lastly, in response to the impact of rising retail prices, the advent of distributed energy and growing concerns around consumer protection, Australia has moved to change network pricing rules. The ultimate goal of the reform: network prices that better reflect the costs of providing network services to individual consumers. This move will likely allow consumers to make more informed decisions about how they want to use energy services and the technologies they invest in to help manage their consumption.27 12 Forces shaping the energy marketplace
Moving forward
The We Economy, greater consumer choice and access, diverse
competitive threats and market environments are radically
shaping the energy marketplace today.
In architecting a future-forward strategy, and capture digital value. Opportunities
every energy provider should consider for energy providers to extend the value
not only the implications of these macro proposition are also identified, including
forces, but also the evolving values and innovative offerings to engage energy
preferences of each new energy consumer. prosumers and the growing potential
of platform-based models in the digital
How can energy providers address energy ecosystem.
changing consumer values and preferences?
Unlocking the digital value of the new
energy consumer is key. The sections
that follow explore the ways in which
energy providers can better understand
The New Energy Consumer: Unleashing Business Value in a Digital World 13Unlocking the digital value of the new energy consumer Digital is changing the nature of consumer engagement across the customer life cycle. Whether to educate consumers, sell new products, encourage self-service or create value with new services, digital must be considered as part of every initiative. 14 Unlocking the digital value of the new energy consumer
It is no secret that digital has transformed shows that only 44 percent of consumers Higher satisfaction. 69 percent of digital
how consumers behave, learn, research are currently digitally engaged (digitally consumers indicate that they are satisfied
and engage with companies. Digital engaged consumers are those who have with their energy provider—14 percentage
continues to disrupt customer service interacted through digital channels over the points higher than those who do not use
delivery, as well as product and service past year). So why should energy providers digital channels.
development. Energy consumers are further invest in capabilities to digitally
increasingly embracing digital on engage consumers? Higher likelihood to recommend. 42
their own—going digital for customer percent of digital consumers indicate that
service and, in competitive markets, for Our survey results show that digitally they would be willing to recommend or
comparing and switching providers. engaged energy consumers can unleash promote their energy provider, compared to
significantly more business value for energy just 13 percent of non-digital users.
In some industries, the distinction between providers than those who do not use digital
a digital consumer and a non-digital channels (see Figure 2): Higher likelihood to share personal
consumer no longer exists. Consumers have information. Digital consumers are about
passed a tipping point of mass adoption of Higher trust. 41 percent of digital 1.5 times more likely to share their personal
self-serve and digital engagement and yet, consumers state that they trust their or energy usage information than non-
in this industry, energy providers may not energy provider to help them optimize their digital users.
yet be seeing consumers adopt digital at energy consumption, versus 31 percent of
the same levels. Accenture’s latest research non-digital users.
Figure 2. The digitally engaged energy consumer unleashes more business value for energy providers.
55% 13%
more satisfied with more likely to recommend
their energy provider their current energy
69% 42% provider
51%
31 %
more trust in their
73%
more likely to share their
energy provider
41 % personal information and
energy usage information
Digital users
53% 59%
48% 80%
more likely to sign
up for home energy
generation products
73% more likely to participate
in an energy management
program
Digital users
70% more likely to sign up for
automated home energy
Non-digital users management devices or services
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 15Higher likelihood to participate. 80 Clearly, energy providers have much to gain Trust is a must
percent of digital consumers indicated from building a stronger digital relationship
they would participate in an energy with consumers. Many providers have With many energy providers redefining
management program, compared to 59 invested in improving website designs, their role in consumers’ lives and moving to
percent of non-digital users. developing mobile applications, building the digital world, a foundation of consumer
social media engagement and strengthening trust and satisfaction is increasingly
Higher likelihood to sign up for energy- digital marketing capabilities. Yet, digital paramount to success. Accenture’s research
related products and services. 70 percent needs to be the engine of every business. shows that, overall, energy providers remain
of digital consumers indicated they would well-positioned in the minds of consumers
sign up for automated home energy Now is the time for energy providers as trusted advisors on optimized energy
management devices, compared to just 48 to take a strategic, systematic approach consumption (see Figure 3). As the energy
percent of non-digital consumers. Digital to transforming their operations— ecosystem continues to expand and new
consumers are nearly 1.4 times more likely so they can unlock the value of digital products and services are introduced, the
to sign up for home energy generation energy consumers. trust advantage can be a valuable asset
products compared to non-digital users. that provides strategic advantage over new
market entrants. Further, it positions energy
providers as potential strategic partners
for retailers, equipment manufacturers and
other home service providers that have
lower levels of consumer trust.
Figure 3. While the opportunity to improve consumer trust remains, utilities/energy providers are still better positioned than
alternative providers.
What organizations do you trust to inform you about actions you can take to optimize your energy consumption?
% Trust
2015 2014 2013 2012 2011
Consumer associations 8% 44% 48% 3pts 51% 46% 47% 55%
Academics/schools/
8% 44% 48% 3pts 51% 49% 34% 53%
scientific associations
Environmental associations 11% 43% 46% 2pts 48% 49% 38% 54%
Utilities/energy providers 17% 47% 36% 1pts 37% 24% 33% 28%
Government/governmental
organizations 23% 46% 31% 2pts 33% 24% 28% 30%
Online service providers 15% 55% 30% 1pts 31% 22% 21% 22%
Home service providers 19% 56% 25% 1pts 26% 15% 17% 15%
Retailers/equipment manufacturers 17% 61% 22% 1pts 21% 14% 19% 14%
Do not trust Neither trust nor distrust Trust
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
16 Unlocking the digital value of the new energy consumerThere is a marked difference in consumers’ Looking into customer satisfaction, 61 Figure 5. Digitally engaged consumers
trust in their energy provider to inform percent of consumers noted that they are have more trust and are more satisfied
them about actions they can take to satisfied with their energy provider. Trust with their energy providers.
optimize their energy consumption between and satisfaction are both significantly
competitive and non-competitive markets. higher for digitally engaged consumers
Digital channel users
In competitive markets, consumer trust was versus non-digital consumers (see Figure 5).
28 percent whereas, in regulated markets,
trust was 44 percent. Regardless of market
structure, utilities and energy providers
Trust and satisfaction are key components,
no matter which strategy an energy
41% Trust
remain better positioned than alternative
providers (see Figure 4).
provider pursues (for more information,
see sidebar: “The four keys to digital
trust” on page 18). By focusing on
69% Satisfaction
What factors matter most to consumers getting the basics right and eliminating Non-digital channel users
in building trust with their energy areas of dissatisfaction, energy providers
provider? The vast majority of consumers
surveyed indicated consistently
getting the bill correct (92 percent),
can establish a strong foundation for
enhancing the customer relationship. 31% Trust
55%
receiving reliable energy delivery (91
percent), and getting clear and easy-
Satisfaction
to-understand pricing information (91
percent) were the most important.28
Base: All respondents.
Source: Accenture, New Energy Consumer research program,
2015 consumer survey.
Figure 4. There is a marked difference in trust of utilities/energy providers across competitive and regulated markets.
What organizations do you trust to inform you about actions you can take to optimize your energy consumption?
% Trust 2015 % Trust 2014
Competitive markets Regulated markets Competitive markets Regulated markets
Consumer associations 51% 46% 53% 49%
Academics/schools/scientific associations 44% 54% 44% 59%
Environmental associations 41% 53% 40% 55%
Utilities/energy providers 28% 44% 29% 46%
Government/governmental organizations 27% 36% 29% 38%
Online service providers 22% 39% 23% 39%
Home service providers 19% 32% 19% 33%
Retailers/equipment manufacturers 18% 26% 18% 25%
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 17The four keys to digital trust
For many companies—financial services, Accenture defines digital trust as the A breach of digital trust or a cybersecurity
healthcare and energy providers—digital confidence placed in an organization incident can quickly result in harmful
trust is central to the customer relationship. to collect, store and use the digital business consequences—from brand
As consumers rapidly adopt new devices, information of others in a manner that erosion to consumer alienation and
unprecedented levels of personal benefits and protects those to whom churn. As energy providers look to drive
information about consumers and their the information pertains. Increasingly, further digital self-service adoption and
habits, preferences and households are customer operations are the digital face to even create new businesses based on
available to businesses and their partners. consumers. Energy providers’ websites are digital platforms, all four keys to digital
The amount of information businesses portals for self-service and, in competitive trust—security, accountability, privacy/
can collect and leverage is exploding— markets, they are fast becoming the data control and benefit/value—should be
magnifying the importance of digital trust. first stop for researching offers. on management’s agenda (see Figure 6).
Figure 6. The four keys to digital trust.
Security Privacy/Data Control
Malware/virus protection Company data policies
Proactive data integrity/ Third-party data sharing
hacking prevention M2M data sharing
Data permissions and Regional cultural expectations
user identity
Government access
Data encryption standards
Data access logs and
key storage standards
Data connections (VPN, SSL, etc.)
Architecting resiliency
The Four Keys to
Digital Trust
Accountability Benefit/Value
Self-governance Customer value
Reactive data integrity/ Services in-kind
legal resource Revenue
Global and regional data Brand value/loyalty
standards
Customer service
Government requisition
Source: The Four Keys to Digital Trust, Accenture, 2014.
18 Unlocking the digital value of the new energy consumerData privacy and security However, consumers are willing to share In addition to further increasing consumers’
personal information if they trust the confidence in their data protection and
Digital channels are just one aspect of energy provider’s privacy and security security, energy providers have the chance
the shifting digital landscape. Smart standards and if they see value in sharing to begin testing and using this data—
meters and smart grid technologies are the information. Sixty-five percent identifying new ways to deliver value
digitizing supply and distribution, providing of consumers are confident that their for themselves and for consumers. Data
vast amounts of customer-related usage energy provider protects their personal monetization is a growing industry. As just
information. Consumers, regulators and and energy usage data and information one example, Accenture estimated that
governments need to feel confident that (see Figure 7). That level of trust is while the global market for monetization
customer information is safe—particularly relatively high, considering that only 45 of data by telecom in just a handful of
because smart meter and connected home percent of consumers have confidence applications (retail audits, location-based
data often provides unprecedented insight in the security of their personal data advertising and card fraud, among others)
into consumers’ personal lives. With such when shared across providers.29 was $22 billion in 2013, it could reach $37
data, analysts can determine the number of billion in 2015.30
people in the home and how they behave
when they are there.
Figure 7. Energy providers have an opportunity to enhance consumers’ confidence in data privacy and security.
How confident are you that your energy provider secures and protects your personal data and information on your energy usage?
Not at all Very
confident confident
10% 14%
Not very
confident
25%
Somewhat
confident
51%
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 19Interestingly, our 2015 survey revealed that need to be very transparent about how they As consumers—especially those who
digital consumers are more comfortable are using consumer data and whether and are digitally engaged—become more
sharing their personal data and have a how that data will be shared with third- comfortable sharing their energy-related
greater degree of confidence in their energy party providers. data with third parties, energy providers
provider’s ability to safeguard their data. that get bogged down in the data privacy
About three-quarters of digital consumers Energy providers can put the decision of debate may miss opportunities. Google,
indicate that they are confident that their sharing information back into the hands through the Nest Learning Thermostat, is
energy provider secures and protects their of consumers with simple, convenient gathering a wealth of home-energy and
data and would allow that data to be approaches. For example, San Diego Gas other behavioral information. To create
shared with third parties (primarily with & Electric® (SDG&E®) has more than 15 and capture value over the long term,
permission). By contrast, only a little more certified third parties that are part of its energy providers need to stop debating
than half of non-digital energy consumers Green Button Connect My Data program. and start formulating a deliberate and
express that sentiment (see Figure 8). Through the program, residential and proactive data and analytics strategy.
business customers can authorize SDG&E
As consumers become more digitally to share their usage information with
engaged, there may be growing specified third parties on an ongoing basis.
opportunities to leverage customer data. Some of these third parties charge a fee
To comply with regulations while building for value-added services, such as energy
trust with consumers, energy providers audits or analytics, while others are free.31
Figure 8. Digitally engaged energy consumers are more confident about their energy provider’s ability to secure and protect their
data and more willing to share their information.
Have confidence in energy Would allow energy provider to share
provider to secure and protect with third parties personal information
personal data and information and energy usage information
about energy usage (primarily with permission)
76%
of digital channel users
73%
of digital channel users
57%
of non-digital channel users
51%
of non-digital channel users
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
20 Unlocking the digital value of the new energy consumerService design is a new When it comes to engaging digital intervening opportunistically or as needed.
consumers, design is a critical capability. Combining humans and automation
critical capability Well-designed experiences go beyond resulted in more than 80 percent of
As energy providers look to create more enhancing consumer engagement; they inquiries resolved online, and employee
enticing digital experiences—those that will actually simplify by anticipating services engagement and satisfaction increased
drive stickiness of current digital consumers and experiences for consumers and as their focus shifted to high-value,
and attract new consumers—they need energy providers alike. For example, non-repetitive customer interactions.33
to reframe the problems and reimagine Internet television network Netflix used
micro data to predict that the show To date, typical approaches to digital user
the possibilities. One viable approach is
House of Cards would be successful experience, system design and development
service design. Service design embraces a
before they started filming it.32 have reinforced a current state and
holistic view of problems and objectives
inward-looking mindset defined by today’s
that considers the situation, context,
Accenture conducted a pilot with a large processes, systems and operations. The
business objectives and consumer behaviors
telecommunications company to effectively No. 1 reason customers would want to use
to redesign how consumers interact with
resolve customer inquiries through a digital their energy provider’s digital channels is
the world around them. It yields digital
assistant that combines live monitoring, quick, convenient service. Yet, 41 percent
experiences that are simple, innovative and
artificial intelligence and automation of consumers still believe the digital
empowering for consumers.
to optimize customer interaction across experience with their energy provider is
channels. Live agents supervise and more difficult than with their other service
collaborate with robots—which handle providers, with younger consumers more
the majority of routine interactions—only likely to have that perception (see Figure 9).
Figure 9. Energy providers have an opportunity to improve consumers’ digital experience compared to other providers.
When considering Web and mobile interactions with your energy provider, do you believe your digital experience with your
energy provider is more difficult than interacting with other types of providers (e.g., telecommunications, retailers, cable providers)?
48% 52%
41% 18-24
years
25-34
years
of consumers believe their
digital experience with
their energy providers is 38% 21%
more difficult than with
other types of providers
35-54 55+
years years
Base: All respondents who interacted with their energy provider through online portal/website or mobile application over the past year.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 21Leading providers will move to a For evidence of the power of service design, This breakthrough innovation has led to
progressive service design experience, consider Scandinavian mobile operator 3. The significant customer adoption, higher
one that begins where the consumer company engaged Fjord to help increase engagement (with 70 percent of customers
starts and leads them logically through self-service adoption and improve customer using the app monthly) and lower call
the various methods of service available: satisfaction by helping consumers truly volumes (half of users report calling
online, social, mobile, voice and in-person. understand their bills. To that end, 3 used customer support less often because
Winning digital brands will seek to bridge a service design approach to develop a of the app).34
the gaps between experiences, services, mobile application that reinvented how its
devices and places. Such gaps cannot be customers view their mobile phone usage Whether energy providers want to engage
avoided, but they can be managed more and bills (for more on this approach, see digitally oriented consumers or wish to
effectively through scalable platforms. sidebar: “Putting design at the heart of increase digital adoption, digital service
your digital business”). design is a core capability that transcends
traditional channel strategy (for an
Recognizing that phones are all about example, see sidebar: “Future-proofing a
connection with family and friends, the retail energy business”).
app offers a view of recent social history,
a dynamic phonebook of favorite friends, a
view of typical daily usage, and engaging
visualizations of the bill.
Putting design at the heart of
your digital business
Fjord, a design agency that is part of It also distills Accenture’s thinking on nine
Accenture Interactive, believes that core ideas and trends aimed at provoking,
effective digital design services are informing, inspiring and, above all,
essential in this era of the digital providing actionable insight.
transformation of everything. To meet
ever-growing consumer demands,
energy providers will benefit from an
emotional, customer-centered approach
combined with rational business analysis
and underpinned by technology and
organizational transformation.
The 2015 Trends Impacting Design
& Innovation report, Fjord’s annual
edition, highlights the impact of
digital on the real world and explores
how digital is shaping both consumer
expectations and service design.
22 Unlocking the digital value of the new energy consumerFuture-proofing a retail
energy business
New Zealand’s Powershop claims to be the Customers can also take advantage of
world’s first retail online energy market.35 energy specials, such as energy that
When launched in 2009, the energy is discounted for a period of time or a
retailer set out to establish a profitable monetary incentive for recommending
new business model—one that would Powershop to friends. These specials
future-proof it against disruptive market are not emailed to consumers; instead,
forces, including the risks of new entrants, they are shared publicly on social media.
inevitable and ongoing technology change, This reflects the company’s preference
and intensifying regulatory pressures. to engage consumers in a two-way
conversation and incent them to use social
Leveraging a smartphone app, analytics media by rewarding them for their “like”
and a strong brand, Powershop is winning or “follow” actions. The retailer is also
energy consumers not only in New exploring the potential to use its platform
Zealand, but also in the highly competitive to feature quasi-crowdfunding programs,
Australian retail market. Powershop where consumers could invest in energy
recognizes that to capitalize on commodity projects to offset future energy costs.
sales, it needs to be responsive to the
needs and values of its consumer base. Powershop’s brand and digital campaigns
From their smartphones, customers can are disruptive, relevant and entertaining,
monitor home energy consumption, be turning many apathetic consumers
notified when a consumption spike occurs into passionate followers. These digital
and choose the source of their electricity. consumer-centric capabilities and offerings
Sources include alternative energy projects have fueled Powershop’s success in
such as wind, solar or even sugarcane acquiring and retaining consumers.
processing and landfill generation.
Powershop’s social media strategy is
designed with a primary focus on customer
choice, convenience and control. All of its
social media channels, including Facebook
and Twitter, offer consumers effortless
access and support, making it easy to do
business with the company. Powershop
also uses its social media channels to build
its fun and quirky personality and brand.
The New Energy Consumer: Unleashing Business Value in a Digital World 23Mobile on the move Of course, mobility also creates an extremely In the utilities industry, the potential for
comparative experience. With just the swipe mobility has not gone unnoticed. The
As energy providers work to transform of a finger, consumers can shift between number of providers with mobile-enabled
the digital consumer experience, mobility mobile websites or applications. Energy websites and mobile applications has grown
remains central to the digital landscape. provider apps live alongside banking apps exponentially in recent years. Some providers
Smartphones have become nearly ubiquitous that have simplified nearly every routine have achieved considerable success,
across geographies and consumer segments. transaction. In addition to viewing account particularly in geographies where storms and
The Accenture Digital Consumer Tech Survey balances and transferring funds to different other dramatic weather events have paired
2014 found that, globally, 69 percent of accounts or people, consumers can snap well with mobile outage capabilities.
consumers own a smartphone, and more pictures of checks to deposit them. They also
than half (52 percent) plan to buy a new can set savings targets and monitor progress, In many situations, however, energy providers
smartphone in the next 12 months.36 The as well as make appointments with bank face a battle for share of screen. In the
dramatic growth in mobility adoption— employees for more complex interactions. United States, for example, consumers
particularly of smartphones—means that Consumers increasingly expect that same spend more than 30 hours a month using
consumers now consider anytime, anywhere level of convenience and ease from all phone apps and use, on average, 27 different
access as a basic expectation. What’s more, providers. The bar for mobile experiences apps each month.38 Standing out in this
satisfaction with digital experiences is will continue to rise, with a recent Accenture digital ecosystem is no easy task—and
increasingly defined by what consumers can C-suite survey revealing that mobility is our research shows that consumers are
or cannot do through their mobile devices. the top area of digital focus among cross- quick and unforgiving in their judgment of
industry executives.37 mobile applications. In fact, 42 percent of
consumers say they routinely delete or stop
using mobile applications after just a few
tries (see Figure 10).
Figure 10. Getting the mobile app experience right is critical.
Which of the following best describes your use of mobile applications?
You delete or 14% You download 29%
stop using applications and
applications after always use them
trying to use them more than four
three to four times times
42%
You regularly 28% 29%
or occasionally You do not
delete or stop download
using applications applications
after the first try
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
24 Unlocking the digital value of the new energy consumerThe top two reasons are related to Consumers expect their energy provider center, and receiving retail promotions
functionality issues (see Figure 11). to deliver a personalized experience that and coupons for energy-related
Consumers expect energy providers helps them in some way. That expectation products and services while shopping.
to seamlessly deliver the appropriate has been shaped by consumers’ daily
functionality in a way that is simple, experiences with other industries—including As mobile apps continue to proliferate,
intuitive and very responsive. Getting the health bands and fitness monitors for the issue of consumers’ mobile real estate
mobile app experience right the first time tracking and improving health; banking becomes a consideration. Successful
is critical. apps that monitor financial goals and mobile app designers not only consider the
monitor progress; and music streaming implications of adding real estate, but also
While energy providers may be inclined services, such as Pandora,39 which determine how the wider ecosystem would
to take a wait-and-see or piecemeal learns an individual’s preferences and work with an addition. Providers also have
approach to mobility, our research produces playlists based on those insights. the ability to offer mobile solutions across
suggests this approach is becoming risky, In our latest research, 62 percent of the spectrum such as responsive Web, or
as consumers’ interest in mobility has consumers said they would allow their leveraging social apps to custom apps.
reached a tipping point. Sixty percent of utility’s mobile application to leverage
energy consumers say they would use a their location information via GPS for Mobility can enable new value and
simple and intuitive mobile app from their value-added services. Specifically, they help redefine the energy provider value
energy provider. More specifically, billing would support such usage for reporting proposition. The key is making sure that
and outage capabilities top consumers’ list or receiving outage notifications and consumers are able to successfully address
of expectations, followed closely by energy updates, identifying the closest payment their needs.
usage information (see Figure 12).
Figure 11. A wide range of mobile dissatisfiers need to be addressed.
Usually, what are the main reasons for deleting or not using an application after the first try?
Too slow
Sent you too many
notifications
35% Too difficult to
set it up
40% 28%
27% Not intuitive
42
Limited
functionality %
21% Dated
information
Did not do
what you wanted
53%
20% Data not
personalized
Ranked within top three
Base: Respondents that regularly delete or stop using applications after the first try.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 25Social @ scale social media. They included discounts for Social networks can also be a vehicle for
location check-ins via Foursquare, as well crowdsourcing ideas. Over a one-year
Energy providers have noticed the growing as discounts through Facebook.40 Texas- period, ComEd ran a social media campaign
power of social networks. In mass outages based Bounce Energy has taken a similar to help redesign its bill. It created a
and natural disasters, social networks have approach, using Facebook and Twitter as Facebook app to allow customers to provide
become the primary vehicle for customer core customer acquisition channels. In feedback on potential designs. When it
communication and message broadcasting. addition to special offers for followers, launched the new bill, the entire journey
Social media also has become an integral Bounce maintains an ambassador program was driven through social channels.42
part of public relations, corporate that rewards consumers for sharing
communications and branding. However, corporate marketing content.41
energy providers continue to work to
develop a holistic approach that delivers Importantly, social media is not just
tangible benefits. about marketing. It also can be a valuable
mechanism for gathering consumer
Social can be leveraged as a platform for feedback. Energy providers have largely
engaging consumers, gathering data and embraced social listening as a way to judge
driving new revenue. American Express sentiment and identify early warnings of
has pioneered several successful online media and customer service issues.
initiatives that monetized the features of
Figure 12. Consumers prioritize bill display and outage information as “must haves” for mobile apps.
Which features or functionalities would you expect when considering using a mobile application to interact with your energy provider?
Bill display 64% Starting or stopping your service
(move-in-move-out)
46%
Outage information 60% Help functions within the app 40%
Report an outage in your location 59% 39%
Control and monitor appliances
Energy usage information 58%
Energy audit information 34%
Account settings and controls 56%
Immediate access to phone Personalized energy-efficiency tips 32%
support if you aren't able to
navigate the mobile experience
53%
Bill payment 52%
Online shopping for new appliances
with rewards and/or points 28%
Meter reading submission
(submit manually or via photo) 51%
Option to split bill between
tenants-roommates 26%
A game that improves your
Account profile information 50% understanding of energy and offers
you rewards
19%
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
26 Unlocking the digital value of the new energy consumerSuch social programs will become capabilities to execute. Successful Creating digital dividends
increasingly important to engaging energy providers will confirm that social
energy consumers. Accenture research monitoring reports are not treated as Even with progress to date, energy
shows that the number of consumers interesting reading. Instead, they will providers have room to improve the
interacting with their energy providers deliver such reports—along with actionable digital experience—and now is the time
through social media is set to double insights—to stakeholders across the to accelerate digital adoption. As energy
in the next two years (see Figure 13). organization. In addition, they will treat providers seek to strengthen and expand
socially-based service not as a side job, digital consumer engagement, they will
For consumers, social is becoming another but as an integrated channel with tracking need to change the fundamentals of the
channel for learning about products and and performance monitoring. And they digital experience, from building digital
services and receiving customer service. will approach social marketing not as an trust to designing services to integrating
Energy providers need to approach these afterthought, but as a central element in digital experiences. Doing so will not only
networks accordingly. Success hinges planning and designing every campaign. unlock value from current business models,
on understanding the relevant social but also unleash opportunities to offer new
audience, mapping customer needs to a With this integrated approach, energy products and services.
social experience the organization can providers can reap the benefits of social—
deliver and, most importantly, confirming and may even be able to do so without
the organization has the appropriate significant additional cost or processes.
Figure 13. Consumers using social media in the next two years could double.
Are you already using or do you plan to use your energy provider’s social media (e.g., Facebook, Twitter, blogs, discussion forums)
for any of the following actions?
16%
13% 12% 10%
11%
24% 23% 24% 22% 24%
Search for information Follow your energy provider Interact with your energy Share content created Post a review about your
from your energy provider (e.g., follow on Twitter, provider (e.g., comment by your energy provider energy provider on a
(e.g., finding YouTube video, “like” on Facebook) on Facebook, tweet) (e.g., retweeting on Twitter, consumer forum (e.g., Yelp)
looking at Pinterest board) reposting on Facebook)
Plan to use in the next 12 to 24 months Already using
Base: All respondents.
Source: Accenture, New Energy Consumer research program, 2015 consumer survey.
The New Energy Consumer: Unleashing Business Value in a Digital World 27You can also read
