All signs indicate that Australia’s energy sector faces a critical crossroad. Mounting competition, unclear regulatory outlook, rapid digital disruption—to name a few—make it very difficult to anticipate what lies ahead. Now, more than ever, it’s important to make sure your marketing strategy withstands potential headwinds.
In this post, we’ll talk about the key trends that keep marketers at Australian energy companies up at night, and we’ll also take a close look at some expert tips to shore up your marketing strategy.
Knowing What’s Ahead
In a research brief, PWC outlines a number of recent and emerging trends that it believes will impact Australian energy firms, particularly in terms of these companies’ marketing and customer acquisition initiatives.
A Customer-led Market
According to the study’s main finding, customers’ influence on the energy supply-demand situation continues to expand and remains on track to exceed energy companies’ collective impact on the market:
- Increasing distribution costs account for 37% of household energy expenses and will represent 81% of household energy inflation in the near-term.
- Customer turnover remains elevated in states with deregulated retail markets and is predicted to be at least 20% per year.
- Storage becomes commercially viable beyond niche applications, potentially revolutionizing one of the energy sector’s most basic technical limitations.
- The trend toward more distributed generation on the network (including solar PV) retains its momentum.
PWC labels energy companies that are well-positioned to meet these challenges as “energy enablers”. Compared to today’s utility firms, tomorrow’s energy enablers:
- Strive to be customer-centric (unlike today’s utility companies which sometimes consider customers as mere “meter points”)
- Provide broader service offerings with multiple options bundled
- Set prices in line with what customers value
- Maintain innovation as a core value
- Stay agile and proactive
Some Marketing Roadblocks
Transitioning from today’s utility to tomorrow’s energy enabler requires a massive rethink of marketing strategies. But as a Marketo energy industry report points out, most energy companies today still face some important obstacles that prevent them from successfully making this transformation:
- Dependence on traditional marketing strategies, which reflects energy companies’ bias toward the status quo
- Inability to determine marketing’s impact on revenues, leaving marketing departments at the sidelines
- Lack of digital marketing expertise and strategy which is often due to a lack of interest
Meeting these pressing challenges will help energy companies move closer to becoming energy enablers.
Future-Proofing Your Strategy
While these trends show where the industry may be heading, there remains a cloud of uncertainty hanging above each of these predictions. Market conditions can drastically change without warning, and it only takes one unexpected shift in any of your assumptions to make your strategy obsolete.
That’s why, rather than focusing on specific ideas to include in your marketing strategy, we’ll talk about practical tips to future-proof your strategy instead. Future-proofing helps you minimize the impact of future events on your execution and results. In a fast-changing environment, making your plan robust enough to account for uncertainty is a vital step.
Writing for Forbes, Steve Olenski says threats like direct competition, consumer and business technology, changing preferences, etc. can throw your entire marketing strategy into disarray. Since it’s impossible to exactly anticipate how these things will play out, Steve provides some guidelines to mitigate these risks.
1. Choose tech with ample room to grow
Technology powers much of digital marketing, but it’s changing too rapidly that it can be hard to keep up with the dizzying rate of change. In a Walker-Sands survey, most marketers admit that MarTech’s evolution continues to outpace company adoption since there are currently around 3,900 solutions (a number which is seeing an 87% year-over-year growth).
To avoid getting stuck with a piece of marketing technology that outlives its usefulness, find something that can easily be modified and upgraded.
2. Always be ready to pivot
In the startup world, “pivoting” is a common idea which means to change a business model or core process that’s not working. While it can be difficult for an established industry player to do a full 180, an energy company can nevertheless take advantage of pivoting when planning and executing marketing programs.
The key idea here is to avoid being locked in any single strategy or approach. Just because a strategy works today doesn’t mean it’s still going to be effective tomorrow.
3. Maintain brand consistency
Strategies evolve, while conversions wax and wane. But if you manage to establish your brand and cultivate customer loyalty, you’ll be in a better position to weather anything that an uncertain landscape throws at you. As competition in the energy sector intensifies and as consumer choices expand, brand identity and customer loyalty will spell the difference between success and failure for energy companies.
That’s how one of Europe’s largest utilities was able to thrive in a competitive environment. The company transformed itself into a customer-focused organization built around its brand promise.
4. Offer customers an experience, not just a product
This is one of Steve’s most important points from his Forbes article, and it’s especially relevant to the energy industry today. An Accenture study estimates that as much as 41% of customers continue to encounter a “difficult digital experience” from energy companies—more than in any other industry.
The report also finds that nearly 9 in 10 customers want an effortless experience from energy providers, while 80% say they’ll buy more products and services if personalized. This is why making sure that you engage customers on their terms using relevant experience is a key step in future-proofing your marketing strategy.
5. Don’t place your eggs in one basket; use multiple channels
Just as you hedge your portfolio through diversification, you also protect your marketing strategy from shocks and stresses by combining different marketing channels together. Each channel has its own strengths which can complement other channels when integrated in a coherent strategy.
For example, while many sources suggest using purely inbound marketing tactics, inbound marketing actually works much better when paired with the scale and precision of outbound channels.
As various forces continue to reshape the energy industry’s marketing landscape, organizations clearly need to refocus their marketing strategies. But since these trends can change in an instant, it’s not enough to have a strategy in place; you also need to make sure it’s future-proof.