For German energy supply companies, the last two decades have been a time of small and large catastrophes: Liberalisation of the electricity market in 1998 Introduction of the Renewable Energy Act 2000 and the associated expansion of renewable electricity Climate targets from the Kyoto Protocol and the planned phase-out of coal-based electricity by 2038 Fukushima disaster in 2011 with the resulting nuclear phase-out From a central market with very few players to a decentralised market with many players, the number of electricity suppliers on the German market has continuously risen and already reached more than 1,200 by 2016. Part of these upheavals, or the energy revolution, is the mobility revolution: transport and mobility are being converted to sustainable energy sources, especially e-mobility, and to networking with each other.
This offers opportunities to energy suppliers: they are expanding their infrastructure business by planning, building and operating charging points (so-called CPO or charge-point-operators). This infrastructure is set up in public or semi-public areas, e.g., at the employer’s premises, or in the private sector (a wallbox at home).
The second major market potential lies in the offer of electric mobility for customers, especially for private customers (B2C). With a cleverly developed portfolio of products and tariffs, a superior customer experience and an intuitive app, customers can get excited – in a market that is not known for storms of enthusiasm.
Mobility turnaround: opportunities for new B2C business models
However, the newly developing e-mobility market is also attracting new, potent players: “VW invests EUR 44 billion in electric offensive”, “Electricity filling station operator Ionity wants to expand” and “Volkswagen presents a mobile rapid charging station” are just a sample of the current headlines. With Elli, the VW Group has also created its own electricity offer, which supplies household customers throughout Germany with 100% natural electricity. Obviously, the major energy producers and marketers – above all RWE/e.ON, EnBW and Vattenfall – are thinking about innovative, customer-centric offers for the electricity customers of tomorrow.
From joint customer surveys with our clients, we know that there are two central questions that private energy consumers need to ask when they decide on an energy offer today:
- Do I understand the offer right away?
- Does it completely cover my solution requirements?
The requirement for simplicity sounds easy enough, but it’s a tough one: in Germany, every household electricity customer can choose between 112 energy providers for their postcode on average. These providers, in turn, have several working price, basic price, term and other contract element variants. In addition, there is a large number of charging cards (and price variants) for the mobile charging current of the electric car. Therefore, if the customer demands simplicity, the bar for the new business models of energy providers in Germany is high.
The first pillar of portfolio development should be a uniform basis for calculating the drawn benefits. In essence, this is always the kilowatt hour, which is used for household electricity, and one of the most important customer concerns is that the same billing basis should apply to mobile charging electricity. Charges per charging time, per charging process or other logics differing from household electricity are unpopular with customers. They are perceived to lack transparency and often unfair. German calibration law still makes kWh-based billing at charging points more difficult, but corresponding solutions are close to market maturity. Energy companies have recognised this customer need and the first pioneers have already switched to kWh-based billing, such as Energie Baden-Württemberg (EnBW) and the Get Charge Telekom company.
Simplicity, however, not only refers to the calculation basis of the product offer, but also to the price points – and of course the product portfolio as a whole.
A bold step towards simplification would be to align the prices for household electricity and charging electricity. “Whether for baking or for charging electric cars. No matter whether at home or on the move” is the motto here. A single price point per kWh, throughout Germany, would make life much easier for customers. A somewhat weakened, but also sensible approach is to leave existing household electricity contracts and their individual price points unchanged for the customer and to include charging electricity (also mobile) under this cover. For the end customer, the existing prices will not change, all electricity for electric cars will be billed in the same way as household electricity. This is also a simple and convincing solution.
Eco-System instead of patchwork
For most consumers, the motivation to drive an electric car goes deeper than the mere desire to use a new technology for the sake of technology. In most cases, it is based on the need for ecological, sustainable and self-sufficient action. It is important for product development to understand both this deeper customer motivation and the entire, concrete customer journey: relevant pain points must be addressed and surprising, inspiring moments in the customer experience must be created.
At this point, joint workshops with the customer on product development, for example using the Design Thinking method , provide valuable insight into customer perception. For the product offering, more than just electricity in working price and monthly fee variations must then be considered. Many elements must be combined into a meaningful, customer-centric ecosystem:
- Hardware: wallbox, photovoltaic system, electricity storage
- Software: visualisation and energy flow and consumption, up to partially self-sufficient management of energy
- Type of energy production: natural electricity, 100% ecological
How these elements are put together to form a convincing overall portfolio, a genuine ecosystem, is derived from customer requirements and the market situation. The focus is on an easy-to-understand, attractive combination offer that includes electricity at home and on the move, for baking and for car charging. With elements such as smart hardware, above all the wallbox, the combination deal can become an ecosystem. In this ecosystem, the customer becomes their own energy manager by also using the electricity they generate themselves, such as from solar power, and can experience the wonderful feeling of “driving with the sun from their own roof”. The advantage on the supplier side is that the customer is comprehensively supported, with hardware and software, and also has a solution ready for networked and growing demands – ideally in the form of term contracts. There are plenty of examples from other industries and Apple, who have mastered a more than comprehensive ecosystem in consumer electronics, software, cloud storage space and media and services, is certainly a prominent one.
We have also had good experience with involving the customer in the ongoing portfolio design at an early stage when launching such an ecosystem. This can be done as a beta tester, for example, with close monitoring of the customer experience and constant, iterative improvement of the initial product.
The App – or how the Eco-System gets to the customer
We maintain that simplicity is a common pricing and portfolio thread. The same must of course apply to the entire customer experience, along all contact points of the company. First and foremost here is the app, as it gives customers access to the energy provider’s offerings at any time, especially when they are on the move.
The following criteria are necessary for a successful, customer-oriented app:
The fact that the app must be high-performance and connect seamlessly to necessary backend systems and customer databases is only mentioned here for the sake of form. However, this can be quite a challenge for traditional companies with extensive legacy systems and should be sufficiently considered. Furthermore, the energy app maps the well-thought-out, seamless customer journey.
In some cases, however, too little attention is paid to the fact that the app also follows the strategic orientation of the company. The company must ask itself how it wants to be perceived. And the answer to this question is reflected at all touchpoints, such as the website, customer service and also the app. Consistency in the brand promise and in the delivery of the brand promise, at all times and at every touchpoint, helps to create the necessary trust on the customer side. Last but not least, simplicity also applies to the app. Less is more and intuitive design always beats the technically possible design.
Helpful, visual dashboards support customers in charging, monitoring and managing their energy requirements. The simplest app can also be one that at least partially replaces itself: those who only want to charge their electric car are often best served by a supplementary charging card, an RFID chip or a “Plug & Charge” solution in which the charging station automatically recognises the customer via near-field technology. To do this, the smartphone app does not even need to be opened.
From the conception and implementation of app development projects, we know that one aspect is often given too little consideration. The continuous testing and further development of the app receives less attention and also less resources compared to exciting new features. This is how technical debts are built up. This is something that must be avoided. The app must be of the highest level in all relevant criteria from performance, to consistency, to simplicity, and it has to fit in with the strategic business orientation.
Are product development and app development also relevant topics for you? Then please contact us. We look forward to hearing from you.
1] Joint venture of BMW, Daimler, Ford, VW/Audi/Porsche