Parks Associates research reports 62% of U.S. broadband households strongly believe that saving energy and lowering utility bills are important, and 30% strongly believe that being “green” is important. However, low consumer awareness and concerns related to the cost of products and services could delay widespread adoption of home energy management — additional research shows 44% of broadband households are concerned about incurring hidden costs with energy management programs.
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The benefits of personalized, real-time solutions — both hallmarks of the connected home — are bringing new possibilities to home energy management, and the very nature of IoT technologies creates new avenues to overcome low awareness and cost concerns.
The core value propositions for smart home systems are safety and security, followed by energy management services. Finding the right mix of incentives is a key to broadening adoption of energy programs. Parks Associates 360 View: Energy Management, Smart Home and Utility Programs, a consumer research study of 10,000 broadband households, revealed that 36% of consumers would participate in an energy program offering a free product. Payments for not using electricity during peak times is also an incentive that can drive program participation.
Non-monetary incentives can expand program participation as well. For example, 29% of U.S. broadband households are likely to participate in a home energy management program in exchange for a detailed breakout of the major sources of energy consumption in the home. Information innovations such as this example are rapidly advancing the opportunities for utility and consumer technologies to link up. Collaboration is essential to maximize the shared customer value of smart energy solutions.
Program design is only half the battle. Getting the word out is also a huge challenge. Partnerships with smart home solution providers and co-marketing agreements can dramatically expand the reach of utility marketing efforts.
Connectivity opens up many new possibilities to use smart products to enhance the value chains of different industries, unlocking new value and enabling participation in new revenue streams that are not directly funded by the consumer. The smart home industry understands the opportunity to work with energy providers to shift load and reduce consumption. When asked, industry experts agree that the energy industry can become a key ally, as vendors look for alternative approaches to monetize products and services.
Working together, smart home solution providers and energy providers can provide compelling solutions to consumers that will simultaneously grow both the smart home market and home energy management program participation, and improve the cost effectiveness of energy programs.
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