J.D. Power and Associates Reports: Wide Variation in Consumer Knowledge and Behaviors Poses Daunting Challenge to Building Engagement with Smart Energy Technologies

WESTLAKE VILLAGE, Calif., Oct. 24, 2011 /PRNewswire/ -- Wide variation in customer knowledge and behavior preferences poses a daunting challenge for utility brands to overcome in building customer engagement around smart grid and smart meters, according to J.D. Power and Associates 2011 Smart Energy Consumer Behavioral Segmentation Study(SM) released today. For example, although customer concerns regarding smart meter security, privacy and health risks have been widely reported, the concerns most frequently voiced by customers relate to smart meter accuracy and fairness.

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The first in a series of smart energy consumer engagement research offerings, the inaugural study is unique in the smart energy arena. The study identifies six behavioral segments, which are based on the types of smart energy activities and degree of control that diverse customer populations will undertake to manage their energy consumption, costs and environmental impact. The segments range from

• the "innovator" segment, which describes customers who make significant out-of-pocket investments to yield large environmental and financial benefits, to
• the "automate" segment, whose members are predisposed to authorize utility remote management of their thermostat in exchange for savings, to
• the "indifferent" segment, who are disinclined to take any energy management actions.

By characterizing residential electric customers according to their energy management behavior, utility brands can optimize customer acceptance of and satisfaction with smart energy technologies. For example, there is considerable variation in the types of engagement strategies that appeal to customers across the behavioral segments. While customers in certain behavioral segments are keenly interested in knowing the amount of energy they use or how much money they can save by taking steps to conserve, customers in other segments want the opportunity to earn points for reducing energy use and to redeem their points for cash or merchandise.

"Rather than focusing on how customers perceive smart energy, the key to creating engagement lies in understanding the kinds of behaviors that different types of customers will undertake—behaviors that utilities hope to encourage," said Peter Shaw, senior director of the smart energy practice at J.D. Power and Associates. "This provides an efficient framework for optimizing effective customer education and engagement strategies designed to introduce smart energy behaviors to large, diverse customer populations."

The Smart Energy Consumer Behavioral Segmentation Study provides utilities with the results of an in-depth energy behavioral segmentation analysis, coupled with hosted access to an expansive research database of 38,090 households, which enables utilities to segment the customer populations of 75 U.S. electric utility brands. In addition, the study data access tools allow utility providers to merge the research dataset with their own segmentation, benchmarking and customer analytics research tools, and to benefit from learning how peer companies apply the segmentation to their respective customer education and engagement programs.

The study is the first offering in the J.D. Power and Associates Smart Energy Consumer Engagement Research Series.(SM) The 2012 Research Series will analyze two key dimensions of effective customer engagement strategy: educational message framing and the customer sentiment impacts of competing engagement solutions. These two studies will be released in the second and fourth quarters of 2012, respectively.

The 2011 Smart Energy Consumer Behavioral Segmentation Study is based on responses from 38,090 households served by 75 of the largest U.S. utility brands. The study was fielded in July and August 2011.

About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company providing forecasting, performance improvement, social media and customer satisfaction insights and solutions.  The company's quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies is a leading global financial information and education company that helps professionals and students succeed in the Knowledge Economy.  With leading brands including Standard & Poor's, McGraw-Hill Education, Platts energy information services and J.D. Power and Associates, the Corporation has approximately 21,000 employees with more than 280 offices in 40 countries.  Sales in 2010 were $6.2 billion.  Additional information is available at http://www.mcgraw-hill.com.

J.D. Power and Associates Media Relations Contacts:
John Tews; Troy, Mich.; (248) 312-4119; [email protected]

Syvetril Perryman; Westlake Village, Calif.; (805) 418-8103; [email protected]

No advertising or other promotional use can be made of the information in this release without the express prior written consent of J.D. Power and Associates. www.jdpower.com/corporate

SOURCE J.D. Power and Associates