AESP Spring Conference

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Moving Beyond Incentives: Using Program Data to Transform the Grocery Marketplace in the PNW

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  • “If you have get a third of the grocers to do something you will be a rock star.”
    Highly remote – pop of 13.5M and target population of 7M
    Some of the lowest electric rates in the country ($0.03-$0.075 per kWh)
    400M sq ft covered about 220M (3rd largest state (Cal is 163.7) or (almost 18 Marylands)
    Harney Electric Cooperative: territory is the size of West Virgina – they have 4,000 customers
  • THEME: We looked at this as a business and not an energy efficiency program
    Rebuilt the program with a customer focus
    Hired different people, focus on customer
    Trust formula
    Tell 3 stories :
    May Au
    The Mikes
    Paul
  • Within 4 years
  • Big vs Small data
    Big data will be able to predict opportunities
    Small data uses what we have
  • Grocers know promotions so we used their tools
  • It started when a grocer commented to a field rep – “You should run a sale. You know we understand a sale.”

    We planned a promotion and built it with the utility

    We selected key measures and incentive increases

    Cost of sales
    Price will fall and not return
  • We did what a grocer would do … we ran a promotion

    We did it ourselves – limited marketing expertise


    We focused on measures that were identified as a frequent opportunity but not selected. We then used our market knowledge to focus on 3 measures:
    Case motors
    Case curtains


    Fred Meyer/Kroger story
  • We tripled expectations

    What are we going to do next
  • Ask question: Who is familiar with this measure

    A complex measure – lots of interest but too expensive

    A promotion was not going to work – limited providers

    The cost of sales is high

  • Define a Buying Group

    Over 120 interested but did not buy
    Over 60 would join the effort
    Over 50 stores

    Cost of sales
    Again: Price will fall and not return

    Spinoff effect was large – within 18 months twice the number of projects were completed
  • Not just for residential
  • Lots of industry players

    GE Story
  • GE story
    Kroger/Fred Meyer story
    Product had to be brought in from other markets

    All in a territory with some of the lowest rates in the country
  • The data is not enough
  • If the market does not trust you this will not work

    Market knowledge:
    Ryon – top contractor
    Ali – ethnic grocers
    Mike – grocer of the year
  • The data makes it happen but market knowledge is key to a great program
  • The data is not enough
  • Positive feedback

    Market Transformation:
    Demand increase
    Market price dropped
    Increased awareness
    Get people excited about energy
    Changed behavior
  • Positive feedback
  • AESP Spring Conference

    1. 1. Moving Beyond Incentives: Using Program Data to Transform the Grocery Marketplace in the PNW Stephen Achilles May 13, 2014
    2. 2. A New Model
    3. 3. • Introduction • The How • Behind the success • Implication Overview
    4. 4. Markets Served
    5. 5. First Two Years - Mediocrity • Started in 2005 • Standard approach for a year and half • Measures installed • Free gaskets • Free vending misers • Low cost or free strip curtains • Fly by night contractors
    6. 6. Three Changes
    7. 7. Resulting Impact • 90% market penetration • Expanded into related markets • New technology • introductions • Over 250M kWh in top 4 years
    8. 8. HOW ESG USED DATA
    9. 9. Program Data Audit data Installed Measures Market TrendsIndustry relationships
    10. 10. Promotions: The $2M Drive for Savings • Limited time promotion • Bonus incentive dollars • Measures of interest • Improve the Grocer’s business
    11. 11. How it Worked Grocer suggestion Plan the promotion Utility approval Begin campaign
    12. 12. Campaign • Select measures and incentives • In-person, mail and e-mail/fax • Utility involvement • Limited time
    13. 13. Major Impact • Demand increase • Spoke grocer’s language • Powerful call to action • Market velocity
    14. 14. Buying Groups: Floating Head & Suction
    15. 15. How it Worked Grocers interested but no purchased Group prospects by geography RFP Process Begin projects
    16. 16. Major Impact • Demand increase • Price reductions of almost 30% • Market awareness • Pricing stayed low • Reduced energy bills
    17. 17. Buy Down
    18. 18. How it Worked Manufacturer interest Grocer interest RFP Process Begin projects
    19. 19. Major Impact • Demand increase • 38% price reduction • Increased revenue for contractors • Pricing stayed low • Opened new markets • Multiple measures implemented
    20. 20. BEHIND THE SUCCESS
    21. 21. Trustworthiness 𝐶𝑟𝑒𝑑𝑖𝑏𝑖𝑙𝑖𝑡𝑦 + 𝑅𝑒𝑙𝑖𝑎𝑏𝑖𝑙𝑖𝑡𝑦 + 𝐼𝑛𝑡𝑖𝑚𝑎𝑐𝑦 𝑆𝑒𝑙𝑓 𝐼𝑛𝑡𝑒𝑟𝑒𝑠𝑡
    22. 22. Market Knowledge National Chains Regional Chains Local Chains Independent Stores Industry Associations Ethnic Grocers Refrigeration Contractors Electrical Contractors
    23. 23. Data Accuracy • RFPs • Bidders requirements • Additional incentive pool • Future credibility
    24. 24. IMPLICATIONS
    25. 25. Market Transformation Behavior Change Market Aware- ness Demand Creation
    26. 26. Contact Information: Stephen Achilles ConserveNW 800.789.4389 sachilles@conservenw.com www.conservenw.com
    27. 27. Save The Dates For more information - www.aesp.org AESP’s Summer Conference San Francisco, CA AESP’s National Conference Orlando, FL Aug. 4-6, 2014 Feb. 9-12, 2015

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