Why we don’t switch to alternative energy

We like to think we live in a world of alternative energy. There’s solar power and many of us drive hybrid cars that use electricity to increase gas mileage. There’s even a Hillary Clinton ad airing in my area, North Carolina, which showcases her promise to increase the number of solar panels in our country.

But you wouldn’t know that we are moving to an alternative energy world Saturday night in the South. A pipeline near Birmingham, Alabama, broke, starting a gas shortage, thus creating empty pumps, long lines and high gas prices.

What year is this? 1979?

Alternative energy
Switching to alternative energy is not easy, even during a crisis.

Many gas stations have that dreaded plastic bag over the pump handles, while increasing gas prices. We’re not in panic mode by any means, but it is still startling.

Fully switching to alternative energy will take more than concern over the environment.

It got me thinking that switching to anything is such difficult work. Most of us, including myself, talk a good game when it comes to the environment and alternative energy, but I do little about it. Oh, I have an energy efficient air conditioner, but honestly I have it because it reduces my energy costs. Not because I’m doing something for the greater world.

Think about this. Remember when the metric system was supposed to take over our highways? We were going to join the rest of the world in adopting the system. It only seemed logical.

But that effort failed.

I bring this up not to berate anyone. But to point out that getting people to switch to anything is enormously arduous.

That is the biggest reason why I do berate brands that believe the same old approach will get consumers to switch brands, even though there is little differentiation among each market’s players.

Each car ad looks and sounds the same. Each beer ad is a copy of another. Car insurance, which spends untold amounts on advertising, offers little reason to switch.

To actually prompt a change in any market you have to be different and better, and often that means being so different that you actually offer a true choice. The definition of a switching trigger is switching to something you don’t have. Otherwise, you stay put.

I don’t think we’ll be switching to the metric system anytime soon. To fully adopt alternative energy we’ll need a stronger and more emotional reason than saving the environment. When a gas shortage directly affects us, then we consider switching.

Sometimes it’s in the crisis where the greatest leap forward takes place. But there are better ways to prompt a switch.

Brand Development in Energy and Utilities

By Tom Dougherty

Utility/Energy Market Study. Common Ground

Brand development in energy could use new blood
Energy and Utilities tell similar stories

Energy and utilities have more in common than just the delivery of energy sources. Certainly there is a difference in a brand that delivers gasoline to automobiles (like multi-nationals like ExxonMobil and TEXACO) and public utilities that provide power and energy (both natural gas and electricity) to geographic specific areas like ConEdison and Southwest Gas. But they have an important asset in common. Both sell and/or deliver commodities to their customers and both groups seek to gain greater importance in the mindset of their customers thus increasing preference and subsequently protect margins. (Read about Ferrellgas here)

How Do You Differentiate a Commodity?

There are many companies that traffic in the delivery of commodities that believe investment in brand is a waste of money. They believe that the only differentiator in such a market is price and that any investment that has a cost attached to it is counterproductive to their desire to simply deliver the lowest priced commodity product on the market.

Such companies rely on the protection of geographic barriers and legislation for their business model and do not understand the human behaviors that influences all purchase decisions. Brand value to your customers can be boiled down to simplicity. They seek simplicity in decision-making and use brand to help them make their purchase decisions easier. The promise of that brand should never be a description of category benefits (table stakes) and yet often it is conveyed as exactly that.

Utilities

 

Brand development in energy seem to all group into one marketing sector
How can a Utility Differentiate?

How many public utility companies define their brand in terms of reliability? Can anyone possibly be a public utility and not be reliable? Which of your competitors claims to be unreliable? No, effective brand expression in this market space needs to be a reflection of the core beliefs and values of the customer you wish to influence. Being “GREEN” or environmentally friendly is a start at this identification, but it will not be long before such claims are themselves table stakes. (Read about analyzing a market here)

Gasoline Companies

 

Gasoline companies are in the energy sector too
All the Gasoline manufacturers claim the same ground

What does a PETROL (gasoline) brand offer their customers in terms of brand promise? BP has invested heavily in its “environmental” stance but has missed the opportunity to drive that message home in the expressions of that brand. Ask a purchaser of BP petrol what the BP brand means and environmentally friendly is way down the list.

 

Mobil, before its merger with EXXON, claimed its brand helped keep engines running cleaner. In other words, Mobil defined its brand by a product efficacy — not a brand equity. A simple turn in that idea would have presented the brand in a different light. Rather than a brand that keeps your engine running cleaner Mobil should have claimed to be a brand for consumers who value prevention over cure. Today, petrol (gasoline) brands are defined by location, location — LOCATION. Consumers are forced to choose based on convenience alone because there is no discernible difference in brand promise.

A Solution

 

 

Building a brand that fosters market share growth means looking at the market differently and defining your brand by the values of the target audience rather than descriptions of your own business delivery model. Who are your customers? Those that find themselves in the fabric of your brand equity. (Read about switching triggers here)

Ferrellgas Marketing and Branding Case Study

Ferrellgas Marketing and Branding Case Study

By Tom Dougherty

 

Blue Rhino is part of Ferrellgas marketing
Ferrellgas Owns Blue Rhino

Ferrellgas is a Fortune 1,000 company that provides propane to more than 1,000,000 customers nationwide. To many rural customers, Ferrellgas is a public utility. Its business is indicative of public utlity trends. Starting as a family owned business in 1936, Ferrellgas is now one of the largest propane suppliers in the United States. Recognized as industry leaders in operations, their technological advances place Ferrellgas in position for strong, sustained growth.

Ferrellgas marketingFerrellgas operates in a market with very low startup costs and a bevy of competitors from every level. This competitive landscape is what separates Ferrellgas from a public utility.

They came to Stealing Share because they were still hungry to grow and increase their business despite being a market leading company. Our task was to understand the market, uncover switching behaviors, and find brand strategies to exploit those findings.

 The behavioral brand model uncovered hidden and important beliefs in public utility trends that needed to be tested. While behavioral modeling typically uncovers nuances in consumer behavior, this model uncovered a series of beliefs that, when validated with the field research, gave Ferrellgas a distinctive and powerful position relative to all of its competition.

 

Visit Ferrellgas by clicking here

 

 

Petroleum retailers can create preference, but don’t know how

Many have thought one of the most difficult industries in which to successfully brand a company is in retail petroleum. Anymore, those retailers are called convenience stores but we know most of them by the petroleum producers, such as BP, Chevron, ExxonMobil and the like.

The difficulty lies in consumers picking gas stations based on price, location and convenience.

Well, at least that’s the excuse.

It’s the same excuse used by fast food restaurants, yet consumers will seek out the brands most important to them. Even in the petroleum industry, Sheetz has done a fine job in creating preference, even if its MTO (“made to order”) feature is a bit misguided.

So it was intriguing for me to see that Phillips 66 was beginning an initiative emphasizing the role of branded marketing.

brands_66stationBut it’s not brand the company is talking about. It’s about loyalty programs, such as a discount card and an app, as well as additional revenue streams by airing advertising on its TVs inside its stores.

Most petroleum retailers have loyalty cards and, while they should be offered, they do not create preference by themselves.

Maybe the problem isn’t that branding petroleum retailers is difficult. Maybe the problem is that the retailers themselves don’t know how to create preference for its brand beyond cost, location and convenience.

Citgo’s “good gas” means proving others have “bad gas”

I will sometimes fill up my gas tank at a Citgo down the road, but my usage is based on its proximity to my home and the lack of traffic getting in and out of it. Not because of any preference with Citgo. On recent visits, I noticed posters Citgo has hung around the station with the slogan, “Citgo is good gas.” My question to Citgo is, what percentage of the market believes that the gas they buy at gas stations is bad?

Gas, at least from my perspective, is gas. I either get gas here or I get gas there. No matter where I buy gas I believe I already have “good.” Regular is “good,” Super is “better” and Supreme is “best.” Beyond that, the assumption is that, if I buy gas at Citgo or at BP, both make my car go. This position is even more nebulous because, differences between gas stations aside, I am not absolutely sure what the product difference is between regular, super and premium. I assume that each grade must just be a bit “gassier” than the previous.

Citgo’s ads remind me a bit of the ads by Carlsberg beer, which say, “Probably the best beer in the world.” Except Citgo’s message is void of the personality that made the Carlsberg’s ads memorable. Without personality or an interesting tone, Citgo’s message becomes unimportant. However, for “Citgo is good gas” to work, it requires changing beliefs that already exist in the market. Beliefs like, “unless the gas nozzle is rusted out or falling apart, I do not not be worry about putting it in my car.”

This is not to say that this campaign could not work. Citgo has simply chosen a harder task: Changing the beliefs of consumers who already believe they can get good gas just about anywhere. If Citgo truly is “good” gas (the implication being that others have “inferior” gas), it should take a page from Proctor and Gamble. Do side-by-side comparisons. Act like your gas is the t-shirt in a Tide commercial covered with grass stain, dirt and ketchup; then make it white again.

My suggestion however, is to drop the “good gas “ and find something more emotionally important to the market. Using an intensity that a brand can align with is a much more effective strategy than convincing consumers that their belief is wrong.