Winning Hearts and Minds (and Air Conditioners): Marketing Demand Response to the Reluctant

Mark S. Martinez, Southern California Edison
Christine R. Geltz, Geltz Communications

Keywords

Abstract

In spite of nearly two decades of promoting incentives for direct load control programs, utilities have found that most small business and residential customers remain reluctant to join. According to a 2005 survey by Summit Blue Consulting, a third of utilities surveyed have enrolled less than 5% of eligible customers in load control programs. Only 7% of utilities report enrollment of more than 30% (Gunn 2006). The remainder of customers – anywhere from 70 to 99% – is seemingly hesitant to take action to enroll in these programs.

To convert the reluctant into participants, marketing efforts need to move from simple, logical arguments disseminated through mass marketing channels to more innovative marketing messages and strategies. The messages must contain a strong educational element and economic incentives that influence consumers’ decision-making process (Geltz & Martinez 2004, 10). Participants then often become avid proponents, confirming their decisions in their own minds and recommending what they perceive as a benefit to those in their social system (Geltz & Martinez 2004, 9).

This paper will explore alternative outreach strategies embracing the diffusion of innovations approach for reaching and converting small business and residential customers into willing demand response participants, especially in hot climate zones under accelerated time frames. This paper will also highlight the value of a consultative sales approach in which the marketing representative is a problem solver, not a salesperson, and review the importance of intra-company collaborations. Finally, this paper will compare the communication challenges of reaching the residential and small business markets.