E Metrics Marketing Optimisation Summit 2008

Think globally, act locally:

Saving the planet, one tiny e-metric at a time.

Patricia Gildea, Online ManagerEcotricity LtdeMetrics Marketing Optimisation SummitLondon – May 20, 2008

Introduction

• The world’s first green electricity company

- Established 1995

• Pioneer of green energy tariffs in the UK- Created the green energy market

• The UK’s oldest and largest independent electricity company (brown or green)

• UK’s largest independent supplier of green electricity

• Only UK energy supplier investing solely in building and generating green electricity

Ecotricity is…..

Who we are

Introduction

• Before Kyoto in 1997

• Before UK electricity deregulation and subsequent choice of supplier

• Before green tariffs established in UK as a choice

• Before wide popular acceptance in the role of CO2 emissions to climate change ---

• Ecotricity was set up to provide a very real option to help fight climate change.

Ecotricity is…..

Who we are

IntroductionIntroduction

• Privately owned by MD & founder Dale Vince

• Current customer base of 30,000+

• Generation, trading & supply of green electricity

• Two green electricity ‘products’ or tariffs - New Energy- New Energy Plus

• Two supply models: standard domestic & SME retail supply, and pioneering Merchant Wind Power

Ecotricity is…..

Who we are


• Changing the way electricity is made in UK

• Why? Because:

- The single biggest cause of climate change in our country today is the burning of fossil fuels to make electricity.

- Our goal is to help people realise that the biggest thing you can do is also the easiest. And that is simply to change where your electricity comes from!

Ecotricity is committed to…..

Our mission


• Moving to wind power is the simplest, easiest way Britons can reduce their contribution to the emission of greenhouse gases, which lead to global warming

• By building as many wind parks as fast as we can, using your electricity bill.

• “Turning your electricity bill into windmills”

Ecotricity is committed to…..

Our mission


• Started as generator only in 1995 – built 1 turbine in Stroud, Gloucestershire

•First to sell energy back to National Grid – took 5 years to convince them!

• First supply customers were in 2000, only possible after deregulation of national electricity • First customers were all businesses – ethical companies also committed to climate change action such as Body Shop, The Co-operative Bank, Triodos Bank.

Ecotricity created green energy market

Our history


• First green electricity domestic supply customers in 2003

• A very young company, now with 30,000+ domestic retail customers

• Also pioneered model of dedicated supply to large business customers through Merchant Wind Power scheme – first clients were Sainsbury (2001), Ford Dagenham (2004), The Co-operative Group (2004), Prudential (2005).

Ecotricity created green energy market

Our history


• 92 turbines comprising 27 Wind Parks

• 134 MegaWatts of green electricity

• 108,000 homes equivalent

• 304,000 tonnes CO2 saved per year

• Doubled our capacity in 2006 and 2007

• On target to double again in 2008

Planning, Building & Operational

Our Wind Parks


• We’ve built one in ten of all the wind projects in the UK.

• Our planning success rate for wind parks is 90%, compared to UK average of 60%.

- The UK’s first megawatt class wind turbine.- The UK’s first fully commercial wind turbine.- The first wind park in London. - The UK’s most visible on-shore turbine alongside the M4 at junction 11.- The only turbine in the world that the public can climb (Ecotech Centre, Swaffham).

More firsts….

Our Wind Parks


• Deregulation in 1999 – not even 10 yrs

ago!

• Relatively young, very crazy marketplace • Fierce competition with pricing wars,

specialty tariffs and switching behaviour

• Highest annual switching rates in 4 yrs (450,000 per month, 45% switched at least once)

A little background…

Electricity marketplace


• Size of market - 27Million domestic electricity accounts (meters)

• Shakedown in marketplace since 2000 – now “Big 6” dominate market space

• Two orders of magnitude gap to “indies” i.e. smallest of Big 6 has roughly 3Million, largest independent has 30K

A little background…

Electricity marketplace


• Green electricity accounts/tariffs are now roughly 340k – that is an astonishingly low stat – around 1% of total market

• Of the 340k - Big Six = 290k indies = 50k-ish

• Different types of “green” tariffs: - range from committing suppliers to sourcing

energy from renewable sources, to giving contributions to green funds, which offset carbon emissions, or contribute in some way to carbon reduction

A little more background…

Green Electricity marketplace


• History of renewable generation – in nationalised electricity era, everyone had

3-4% renewables from existing estate of hydro, wind, biomass, etc.

• The Big Con – vast proportion of “100% green tariffs” are just redistributed & repackaged existing renewable energy

• They make no new contribution to reducing CO2 emissions – status quo




• Redistribution = Greenwash!

• All suppliers obliged to meet Renewables Obligation; most can’t and they just pay Ofgem fines

• “New Green Energy” v “Old Green Energy” – goal is not an individual’s footprint reduction, but the entire country’s.

• “People think they’re reducing their emissions, but what happens with a 100% tariff is that you basically cause someone else's emissions to go up, just so that yours can go down.”




“ Having 100% green is not the big issue, there's only a limited amount of green energy out there and bundling it into 100% tariffs for the few, although they promise carbon reductions, only actually serve to redistribute existing energy. Typically there's no net reduction in emissions or increase in renewables.

We cannot all switch to 100% green overnight, it has to be built. Honest tariffs, in our opinion, acknowledge this and are dedicated to new build, not old redistribution. The real test is not 'what you have‘; it's 'what you're building', and the measure of that is simply what you spend. Not glossy TV ads and fine words - but actual spend on actual projects.”




• So goal is to build as much new sources of green electricity as fast as possible

•Every year, we spend more per customer building new sources of green energy, than all the other UK suppliers put together.

• We spend the equivalent of an average UK electricity bill, each year, per customer, building new sources of green energy.

•How did we, and do we, tell this story?

Our USP

Market positioning


• Proposition: use your electricity bill to fight climate change – it’s the single biggest change you can make.

•AND…when you choose a green tariff, make sure your electricity bill is being invested the best way you can, in building new sources of renewable energy

•It’s not just about you – it’s about the nation and the planet!

Proposition

Market positioning


• But…many people think of this as a complicated and/ or risky endeavor

• People worry about making their power supply dependent on the wind blowing all the time!

• Reality - it takes only about five minutes to switch, does not involve any risk, don’t have to live near turbine, no interruption to supply, and frequently there is no extra cost.

Perception v Reality

Market positioning


• Small company, no big ad budgets –

commitment is to spend money on build

• Our marketing is “telling our story” – a compelling story, first to people who are already committed and interested and care

• Developed partnership model with like-valued companies

• We built and continue to build a community of committed individuals who support the shared vision & goal.

Telling the story

Marketing strategy


• It isn’t about individual’s carbon footprints

per se – it is about investing in UK future of zero carbon energy, with stable & secure energy sources - collective vision of Green Britain

• Partnership model good fit

• Some of our earliest partners were our first business customers such as Body Shop, Soil Association, Cooperative Bank, Triodos

Telling the story

Marketing strategy


• No large-scale advertising per se - only

through actual turbines & logos! Such as the GreenPark turbine in Reading, visible from M4, Bristol Port Company in Avonmouth Docks, visible from M5

• PR as main ATL; plus ads in partner publications, partner sites, partner mailings & e-mailings

• Building communities & partnerships off line in specialist magazines such as The Ecologist

Partnership model

Marketing strategy


• From earliest days, the partnership model

was also perfect for online community building

• Supported SEO by establishing new brand through association with large, established brands such as WWF and Body Shop

• Increased authority & authenticity through partners & affinities - key to green brand management, too

Partnership model

Marketing strategy


• New Energy was single tariff offered (= 1 product)

• Website very focused on simple sales message

• Homepage had 26.7% real-estate for direct action sales

•-> DIDN’T need lots of explanation!

• Committed, like-valued prospects, drawn primarily from partner network & communities, easily turned into customers

•Also yielded very high e-channel delivery of total sales mix – over 80%

For 2006…

Early days of great success


• The homepage real-estate had 28% focused on strong call-to-action to switch.

• Committed prospects became very loyal customers and vocal ambassadors for us.

• Hard to get mainstream media coverage

• -> No ATL competition from Big Six

For 2006…



• Switch journey had excellent metrics • Conversion rate of switch funnel = 22-28%

• Conversion rate of full site = 3-4%

• Top 25 urls viewed = 75% of total pvs

• Breakdown of that 75%:• Homepage – 43%• Switch-related pvs – 23%• More info-related pvs – 9%

For 2006…



• In 2007, however - Going green goes mainstream!

• Climate change throughout media & public awareness

• “2007 was the year the world woke up to the reality of climate change. It was the year in which an un-arguable consensus emerged - that climate change is real, requires urgent action if we're to keep the planet habitable, AND will be cheaper to deal with than to ignore.”

• High street brands take up C footprint issues

For 2007…

So how are we doing


• All the daily newspapers, even the tabloids

• All over the TV and web

• All over magazines, lifestyle shows, festivals

• Can’t get away from it!

• BBC Green website, Guardian & Telegraph websites environment sections

• Everyone has a carbon calculator on site

• Government on bandwagon, too

For 2007…

So how are we doing


March 2007 to March 2008

Success measures

delta

Pageviews 153.7%

Visitors 77.5%

Visits 91.8%

Depth (directories) 173.3%

Pages/visit 32.3%

The year “going green” went mainstream…

…website saw healthy increase in overall traffic & behaviour measures…


March 2007 to March 2008

Success measures

delta

Time on site 1.3%

Bounce rate -4.4%

Referrer urls 38.3%

Referrer keywords 98.8%

Depth (page urls) 47.1%

Partner urls 30.8%

(within session journey)

Even the less obvious metrics showed very healthy increases in behaviour & traffic…


Up and to the right….

Changing marketplace

Ecotricity website metrics

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20,000

40,000

60,000

80,000

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Feb-0

7

Mar

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Nov

Dec

Jan-

08

Feb-0

8

Mar-08

Visitors

Visits

Pageviews


With shifting market conditions & increasing green awareness AND confusion, increasing need to tell a bigger story

- Direct switch homepage real-estate evolved

• September 2006 - 27.6%

• March 2008 – 4%

Unexpected consequences…



Increase in number of total urls viewed -2007 to 2008



0

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3500

Jan Mar Jan Mar

Number of urls viewed


Changing mix of top 25 page urls viewed -2007 to 2008



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10,000

20,000

30,000

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Jan Mar Jan Mar

Customer Service-related

Information-related

Switch-related

Homepage


• From 2007 to early 2008 - Despite wonderful traffic growth, and more engaged behaviour, we saw:

• Steady, month-on-month decrease in conversion rates, both site total and specific switch funnel

• Steady, month-on-month decrease in web sales

• Steady, month-on-month decrease in e-channel percentage of total sales

Further consequences…



• March 2007 to March 2008 –

• 71% decrease in site total conversion rates,

• 29% decrease in switch funnel conversion rates

• 47% decrease in web sales

• 46% decrease in e-channel % of total sales

• What is going on?! Shouldn’t it be so much easier now?

Further stark consequences…



• WHY?!

• We think FOUR main reasons…

• First is prices. And interestingly both the price reductions of 2007, and the sharp increases of 2008 had similar effect – focus on comparisons.

• Second is additional crucial area of “green” noise:

• Big Six started serious (and deeply cynical) ATL advertising about how “green” they are. Jumped on bandwagon once green was mainstream…spent millions & millions…

What happened?

So how are we doing


• Third is another crucial area of “green” noise:

• Ofgem (Government regulator for energy) introduced Fuel Mix Disclosure requirement to “help” consumers figure out which suppliers are greenest

•FMD became one-issue metric…

• Fourth may be the LHF effect…the Low Hanging Fruit (= Deep Greens) are already harvested.

• Now have to market to Pale Greens.

What happened?

So how are we doing


• Already had the issue of 100% green tariff Greenwash from Big Six and other small indies

• Now also had clamour of conflicting claims about whose more green, best green technology, best renewables approach, etc.

• Result was even more Greenwash!

• And the site shows effect of both the broadened appeal and the conflicting messages/claims…

What happened?

So how are we doing


• We hasten to point out…Our conversion rates have moved from fabulous to above average for an electricity supplier!

• Whole site conversion rate now only around 1%, but…site visitors, prospects & customers are reading much more about what we stand for!

• Switch application funnel now only around 11%,but data quality has improved, lowering total CPA

• Web sales around 50% of all sales, but increase in call centre sales has cross-fertilised & boosted web customer services usage!

• We have developed a new programme of work to

Use the technology better

Don’t panic…


• We have developed a new programme of work to enhance & harvest this shifting traffic, shifting market, and shift in technology usage.

• First is the launch of our MD’s blog:

•www.zerocarbonista.com•Very successful, early days; high quality of comments, high ratio of comments/post, lots of ideas, superb PR; documented sales & retention effect already!

•Went viral very quickly through green blogsphere community.


Don’t panic…

http://www.zerocarbonista.com/


• Second is the launch of our Ecotube channel:

•www.ecotricity.co.uk/ecotube• Showcase of our build programme, both generation for retail and for MWP

• Again, went viral very quickly through green blogsphere community.

• Like blog, very effective in explaining USP, communicating our mission, persuading Pale Greens to join us


Don’t panic…


• Third is the re-launch of our Whichgreen microsite:

•www.whichgreen.com• Focused microsite to provide information and a key metric to help cut through the greenwash

• Also moved key content to main site, to key places in persuasion & education journey

• Critical concept, summarises our USP: compare UK electricity suppliers to see commitment to build new sources of renewable energy – Pounds per Customer


Don’t panic…


• Full embracing of Web 2.0 and beyond, to inform, persuade and convince – it’s the planet that’s at stake!

• Challenges are measuring AJAX events, cross-platform video streaming and podcasting in Ecotube, blog efficacy on e-commerce goals, and then there is PPC in the new Google world……

• Future is fascinating, challenging, intensely fun…and critically important.

THANKS.

Making a difference

A Greener Britain

IntroductionIntroductionA Greener Britain

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