We hear this topic discussed almost everyday in the solar industry. How do we reduce or eliminate barriers to adoption, and what programs or activities are needed to make solar/PV a mainstream technology? Within this endless debate, it's interesting to see the different strategies being applied toward reaching the common goal of increased market adoption.
Two examples of recent initiatives -- specifically aimed at taking solar into the mainstream -- include groSolar's national advertising campaign and Akeena Solar's partnership with Westinghouse. In terms of strategy, groSolar is relying on building awareness whereas Akeena is focusing on brand recognition and using "home improvement" channels of distribution. Yet in my mind the most interesting strategy is the one employed by an organization called 1BOG.
Buying solar involves a complex, information intensive and high risk purchase decision. (Note I said the purchase decision is complex and high risk, not the technology) This is exactly the reason why the solar industry has not yet reached a tipping point. Solar/PV is a high cost product, supplied by unknown vendors, in an industry without uniform standards or government regulation.
When faced with a purchase decision that involves high cost and/or high risk, pragmatic customers (starting with the early majority) will not buy until they see proven/leading suppliers, references from people they trust, and reliability of service. 1BOG helps mainstream customers meet these buying requirements by offering a unique combination of group purchasing/installation and objective advice.
1BOG's service organizes homeowners in a given area and allows them to purchase and install solar as a group. In addition to negotiating a volume discount of about 15%, 1BOG acts as an independent provider of quality assurance and objective information. To qualify as a 1BOG vendor, local solar companies must go through a rigorous evaluation of their products, installation practices, and longterm stability as a company. Customers are also provided with assistance and support in the areas of rebates/incentives, financing and permits.
While most people would point to the 15% reduction in cost or the assistance provided with bureaucracy and paperwork as the primary benefits of 1BOG's program, I believe the true power of their approach is in helping reduce the perceived risk of solar.
In the world of high risk the customer will not rely on the word of a vendor. The customer’s decision process is based on finding objective information from reliable sources, something the vendor cannot provide. 1BOG reduces the perception of risk by acting as that provider of objective information. 1BOG facilitates references from trusted sources (by organizing buyers into self-referencing groups), and then provides evidence of expertise and product quality (by vetting local solar providers).
The 1BOG strategy is by no means complete but it does a good job of addressing some of the needs of mainstream customers. Only time will tell if this, or other methods, will deliver the anticipated prize -- solar's mainstream market.
Warren Schirtzinger advises solar companies on how to: differentiate their products, grow during an industry shakeout or consolidation, and thrive without government subsidies. He has authored articles as a "Renewable Energy Insider" on RenewableEnergyWorld.com and writes about marketing strategies on the solar strategies blog. Contact him via e-mail (warren["at"]solar-strategies.com) or follow him on Twitter @SolarStrategies.
Labels: product management, solar industry, technology adoption, Warren Schirtzinger