Market Transformation Meets Resource Acquisition: The Mid-Market Approach

Margie Gardner and Susan Hermenet, Northwest Energy Efficiency Alliance
Phil Welker, Portland Energy Conservation, Inc.

Keywords

Abstract

Market transformation organizations have created valuable partnerships with manufacturers, distributors, and retailers in residential product markets. The product distribution channels that exist between manufacturers and retailers are complex and an important part of the market. The marketing, sales, and field resources these players can task toward efficiency often dwarfs the capability of publicly funded market transformation programs. The distribution networks are powerful, but the players resist long-term change based on short-term promotional efforts that disrupt business as usual. Some of our most dramatic program success has happened through the use of flexible cooperative funding pools that allow implementers to sit at the table with these players and create joint ventures that satisfy everyone's needs.

The authors label this network of relationships the “mid-market.” They argue that working with the mid-market represents more than just a slightly more efficient way to accomplish program objectives. Rather, the ability to leverage existing distribution systems can turn market transformation activities into powerful resource acquisition tools. This new paradigm requires significant change in the way programs are designed, implemented and funded.

The new generation of mid-market initiatives will look much more like business ventures and a lot less like "programs." They will require program implementers to become reliable business partners within the market they wish to transform. Effective players will have to cultivate a long-term role for themselves within the network of relationships. This paper examines successful mid-market activities and programs currently under development to arrive at a new model for program design .