This is the story of how a plucky energy brand abandoned its successful price led communications model in order to drive long-term growth, while still delivering on short-term success.
Following success providing gas and electricity to businesses since 1999, Energia entered the highly competitive residential energy market in 2014. Dominated by customer inertia, any gains to be made in this market must come from the relatively small pool of customers (approximately 14% of electricity and 18% of gas customers*) who regularly switch their provider. Because these switchers are attracted by a good deal, competing to acquire them has become a discounted price race to the bottom.
As a new entrant, Energia focused on price led advertising, always communicating the percentage or monetary saving customers could make by switching to them. And it worked. While Energia became known for being cheap, lowering their price versus the market, their customer base and market share grew. But as the brand matured, Energia knew that relying on price alone to attract customers meant they were staring down the barrel of a lifetime of price discounting.
To exacerbate this challenge, research showed Energia was strong at converting brand considerers to purchase, but the number of customers considering the brand was minute compared to their competitors.
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