Opower, the startup that’s driving utility residential customers to shave energy use with targeted reports sent via web, email, text and the U.S. mail, has taken the next logical step in monetizing the process: pitching energy retrofits and rebates from big-box retailers.
That’s the gist of the Opower Marketplace product launched Tuesday, which promises to use its home-by-home energy data to match the right retailer products or services -- and the right utility rebates or incentives -- to individual customers.
The Arlington, Va.-based startup has named Home Depot as its first customer, and expects to add more retailers in the future. Getting big-box stores engaged in pushing home energy efficiency products will be critical to pushing the field beyond pilot projects, though the economics of in-home energy saving technology are still daunting.
Opower’s light-touch, low-cost approach provides an interesting alternative to the idea of installing smart devices in the home itself, as Lowe’s is doing with AlertMe and Verizon is doing with Motorola’s 4Home -- though potentially, Opower’s smart thermostat partnership with Honeywell could explore the in-home device avenue, as well.
For now, however, Opower Marketplace offers retailers a new advertising channel to reach customers already more engaged in home energy efficiency than the average Joe. For utilities, it offers the prospect of increasing participation in efficiency programs that don’t get much response from customers today.
“We call it energy data-driven marketing,” Ogi Kavazovic, Opower’s vice president of marketing, said in a Tuesday email. “Based on a customer's energy consumption profile, we are able to match them to the right product offer.” For example, he wrote, Opower would direct rebates or offers aimed at making the home more cooling-efficient to “summer peaker” customers -- homeowners whose energy usage patterns spike on hot summer days.
This kind of data-driven efficiency marketing has been at the root of many home energy management efforts, from startups like Simple Energy, Tendril, Energate and EnergyHub, to IT giants like Microsoft, which planned to make money on its now-defunct Hohm home energy gateway via advertising from local energy efficiency auditing and retrofit businesses.
But Opower’s broad reach could give it a bigger channel to market. It’s working with about 60 utilities that collectively serve about 60 million U.S. households as customers. About 10 million of them are interacting online with Opower’s cloud-based platform, Kavazovic told me last week.
Opower just announced it will have delivered 25 million energy reports to utility customers by month’s end, and expects that figure to reach 75 million this year. It’s also working with Facebook to promote energy saving via social media.
To make it easier for customers to redeem their rebates and coupons, Opower will include a barcode for each unique customer offering that can be scanned at Home Depot checkout lines.
“In general, the problem we’re trying to solve here is low consumer participation in utility-marketing rebate programs, which hovers at around 1 percent each year,” Kavazovic wrote. “We think that our offer targeting engine, plus point-of-sale rebates, can really start changing this equation.”