Consumer-Centric Program Design

Brian Sloboda, NRECAMilton Geiger, Poudre Valley REA

February 27, 2018

Reimagining the Product Development Process

Utility-first

Member-first

Today’s Questions and an Overview

What the $%*@ is design thinking? What are NRECA and Poudre Valley REA doing with this

approach? How does technology enable design thinking approaches? How can my co-op apply these lessons?

How to Pick What to Do

•Pick the goal… not the technology•Most people are too close to the problem to solve it

Design Thinking

Co-op

Technology

People

The Puck

Design Thinking

• Is a human-centered approach to problem solving that supplements analytical processes to surface new ideas and unlock value

•Ultimately seeks solutions that are desirable to members, viable to the co-op, and feasible given current and emerging technology

People Want to Save Money

3 Steps to Understanding 1. Immersion

2. Observation

3. Engagement

Look at Your Extremes

People Activities

What Design Thinking Gets You

Why is PVREA exploring this?

A Consumer Centric Utility is a Load Serving Entity or utility that integrates and optimizes a portfolio of resources on behalf of consumers, including central-station generation, transmission, distribution, and DER, including energy efficiency, demand response, distributed generation and storage, and community-scale generation and storage. - NRECA The 51st State Phase II: The Consumer-Centric Utility Future, June 2016

Where do we start?

(Notice that it is blank…)

Where do we start – ESource EDesign2020

Where do we start? – Self-awareness

How do I get this type of info? – Mobile Ethnography

It ain’t a focus group!

How do I get this type of info? – The tech

It ain’t a focus group!

How do I get his type of info? – The tech

Meet the members

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VICTOR Energy Efficiency

TONYElectric Vehicles

JOERate Design

KENNYElectric Vehicles

Note: all participant names have been changed

Looking at all the insights across topic areas, five key design imperatives were created…

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UNIVERSAL LOW INCOME SOLAR POWER CONNECTED HOMES

ENERGY EFFICIENCY RATE DESIGN VALUE-ADDED SERVICES ELECTRIC VEHICLES

INSIGHT THEMES BY TOPIC AREA…

FIVE key design imperatives for energy utilities to help shape the future of new offerings, customer relationships, and engagements. Each design imperative is…

Relevant across all topic areasBased off real consumer needs / pain points

Action-oriented

Turned into…

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

DESIGN IMPERATIVE #1

ENGAGEMENT DESIGNEnergizing how people engage with energy

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

Engagement DesignFiguratively and literally, energy is what fuels our lives. In today’s digital world, energy is often the key ingredient for our passions, social connections, and productivity…it enables us to be the people we want to be. So why is it that we feel so anemic when it comes to caring about energy and energy conservation?

There’s an opportunity for utilities to break from “business as usual” and re-energize how consumers think about energy. Whether it be through games, rewards, points, badges, friendly competition, energy “sales”, or partnerships …there’s plenty of ways to make caring about energy more fun and engaging for customers.

Engagement Design

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EXAMPLE WHAT IT MIGHT LOOK LIKE IN ENERGY

Turing a Boring Task into an Engaging One

Challenge: Cisco had invested in a global training program for its employees and contractors to build and leverage their skillsets. But with over 46 courses as part of the program, it was overwhelming to figure out where to start.

Solution: Cisco introduced three levels of certification for the training program: Specialist, Strategist and Master, as well as four sub-certification levels for HR, PR, sales, and internal partner teams. It also mixed in team challenges to incorporate a healthy dose of competition and collaborationinto earning “badges” as rewards for their hard work.

Results: Since gamifying its training program, more than 650 Cisco employees have been certified with over 13,000 courses taken.

• “Happy Hours” / “Flash Sales” for energy that makes saving energy fun and more akin to how customers “deal hunt” in real life

• Energy efficiency gamification (e.g., using points, scores, competition, badges, personal targets, rewards, prizes, contests)

• Healthy lifestyle programs (i.e. reward consumers for being active, spending time outside, and using less energy inside)

• Partnerships with relevant lifestyle and other “cool” brands (e.g., partnering with local sports teams and popular lifestyle brands)

• Building electric vehicle charging stations that are experience-based (e.g., near museums, hiking trails, parks, cool stores, etc.)

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

DESIGN IMPERATIVE #2

REWARD DESIGNRecognizing and celebrating customer accomplishments

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Reward DesignThe strongest brand relationships are built on mutual respect, communication, and loyalty. In today’s day and age, customers that are faithful to a brand expect reciprocation in the form of points, gifts, and enhanced status…something that shows their business is valued and respected. When it comes to energy utilities; however, the notion of feeling “rewarded” is completely absent.

From this sometimes deep-seeded feeling of “they don’t care about me” comes a significant opportunity for utilities to step up their game, go above and beyond, and prove they care about customers beyond just transacting for energy.

Reward Design

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EXAMPLE WHAT IT MIGHT LOOK LIKE IN ENERGY

How Starbucks Rewards Raises the Bar-istaUpon implementing their rewards program, Starbucks saw a record setting quarter. The program helped increase revenue to $2.65 billion, with executives pointing to the increased participation in the loyalty program as the main driver.

• Bonus points and rewards systems for things like length of tenure (e.g., 5 and 10 year bonuses), on-time / consistent bill payments, and reduction of energy usage

• Customer tier systems with “top” customers receiving extra rewards, benefits, or services from the energy utility

• Personal and specialized “gifts” (e.g., $10 energy credit on your birthday month) to show customers they are valued

• Expanding rewards options to motivate all individuals (i.e. chose between cash back, bill credits, gift cards, free services, free experiences, or free products like smart thermostats, lights, etc.)

Personalized OffersThe Starbucks mobile app enables its reward program to be extremely dynamic. Whenever a customer checks the app they are greeted by personalized, limited time, bonus offers that are timely, relevant, and geo-located. Exclusive Status / BenefitsWhen a member gets 30 “stars” in a 12 month period they achieve “Gold” status. This comes with perks like: free refills, free food and drink offers, and most importantly the personalized gold card that signals status.

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

DESIGN IMPERATIVE #3

ADVISORY DESIGNThe first and only stop for energy information and opportunities

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Advisory DesignThe topic of energy is more complex and dynamic than ever…from the debate on climate change and renewable energy, to the increased personal accessibility of solar power, to the invention of “smart” energy devices, and to the myriad of energy incentives at the federal, state, and local level. All this information is enough to make someone's head spin, and consumers feel they have no trusted source to learn about all these topics…not even their energy utility.

Given the current environment, energy utilities have a big opportunity to shift their role from being a transactional energy supplier to being a holistic energy solutions manager…guiding consumers through all the modern-day complexities of energy.

Advisory Design

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EXAMPLE WHAT IT MIGHT LOOK LIKE IN ENERGY

From Selling Machines to Selling SolutionsCaterpillar offers services that demonstrate the efficiency of their heavy machinery products “to help companies lower distribution costs while improving customer service, asset utilization, and brand loyalty.” They offer this service to customers who are NOT purchasers of CAT’s heavy machinery, and as a result, now do business with companies like Bombardier Aerospace, Land Rover, and U.S. Cellular.

• Real time energy goal-setting, tracking, and alerts between billings

• Unlocking the power of “smart” data to help customers get smarter about how they spend energy and money

• Becoming “one stop shop” for energy incentives (i.e. consolidating opportunities across federal, state, and local levels)

• Energy audits 2.0…moving from giving “checklists” to giving personalized advice (and helping them follow through)

• Optimal “smarthome” consulting (e.g., navigating smart thermostats, lights, security, home hubs)

• Itemization and breakdown of energy bills (i.e. show what devices used what energy)

Leveraging Technology to Advise and Inform

“Cat Connect provides smart use of technology and services to optimize equipment for your success. Using the data from

technology equipped machines, you’ll get more information and insight into your equipment and operations than ever before.

Working with your Cat dealer, you can find the right solution of Cat Connect technologies and services for your needs.”

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

DESIGN IMPERATIVE #4

CHOICE DESIGNEnabling choice in a choice desert

Choice DesignIn today’s fast-paced and chaotic environment, so many things in life can feel out of our control. This lack of control creates anxiety about our ability to shape our own outcomes, and it’s why successful brands often empower customers with greater choice, freedom, and control. However, given many consumers see their energy utility as a monopoly, these relationships are often built on the exact opposite of freedom and choice.

If consumers can’t choose their energy utility, then we can at least provide choice WITHIN our relationships…giving people more options across rate designs, bill payments, and reward structures so that they feel more empowered and in control of their energy.

Choice Design

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EXAMPLE WHAT IT MIGHT LOOK LIKE IN ENERGY

• Services that allow customers to choose or “design” their own rate plan based on personalized preferences and specs

• Ability to choose incentive types for good behaviors (e.g., bill credits, cash back, gift cards)

• Risk free trials for energy efficiency or rate design programs (i.e. helping people feel in control of their choices)

• Ubiquitous control over the rebates and credits process (e.g., can submit any energy efficient purchase for rebates…anytime, anywhere)

Offering Choice to Boost Engagement

The Challenge: Google, like many companies, needed more employees to submit travel expense information on a timely and regular schedule.

Solution: When Google employees take a work trip, they receive an allowance for each location. Google re-designed the expense process by letting employees who didn't spend their entire allowances CHOOSE what happened to the remaining money — getting paid out in their next paycheck, saving funds toward a future trip, or donating it to a charity.

Results: Offering more choice within Google's travel expense system translated into 100 percent compliance within six months of launching the program.

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E SOURCE E DESIGN 2020 RESEARCH EXECUTIVE SUMMARY

DESIGN IMPERATIVE #5

LOCALIZATION DESIGNClaiming what’s rightfully ours

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Localization DesignThe trend of “localization” is here to stay, and people increasingly want to support and celebrate the things that are born from their city, town, or region. Ironically, energy production is one of the most localized aspects of the community; however, customers don’t often see or feel this…instead they often have a much more impersonal and “faceless” perception of their energy provider.

This presents an opportunity for “big time” energy utilities to reclaim a “small time” feel and use localization as an asset for their brand. Local volunteering, education seminars, sponsorship, and community solar farms are just a few examples of how utilities can help “humanize” the business of energy.

Localization Design

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EXAMPLE WHAT IT MIGHT LOOK LIKE IN ENERGY

Tapping Into Local Texas PrideAs a Texas-only store, H-E-B works the Lone Star connection into every touchpoint of its experience. By doing so, they’ve turned a disadvantage (lack of geographic scale) into a competitive advantage for their brand.

• Adapting “humanized” energy language (e.g., from “distributed” energy to “local” energy)

• Expanding the popularity and accessibility of solar communities and “farms”…helping people that buy in feel part of the solar “movement”

• Creating youth outreach and education programs to create future energy efficiency advocates and build relationships with current customers

• Expanding the definition of low income consumers and making low income programs more inclusive, understanding, and welcoming

• Sponsoring locally-based community events, charities, and causes

Community Events and Volunteer Work

Local Pride in Advertising

Supporting Local Brands and Products

Texas Themed Private Label

Products

Authentic Texas BBQ In-House

Partnerships with Local TeamsLight-hearted,

localized language

What can you do with this stuff?

Inspiration Ideation Implementation

Understand Observe POV Ideate Prototype Test Storytelling Pilot Business model

Rate design…expressing value and “choice in a choice desert…”

What can you do with this stuff? – The process High EnergyUncertainty

UncomfortableActive Participation

CollaborationDigging Deep

OpennessPresupposing solutions

What can you do with this stuff? – The goal

Walking away with a new residential concept to take home, push through the inner workings, and test with customers.

Happy to chat

Brian Sloboda brian.sloboda@nreca.coop 703.907.5689 Milton Geiger mgeiger@pvrea.coop 970.282.6442 www.pvrea.coop