Influencing Consumer Perception for Clean Energy Solutions
The emergence of LPG, solar and other clean energy solutions in Nigeria has shown tremendous impact so far with even more potential to uplift the country’s ~40% out of poverty. But to make this goal truly sustainable is to identify and maximise commercial opportunities for companies providing these solutions and for consumers in communities with low economic activities.
The industry has shown an unrelenting focus tackling the latter by hiring local workers for production and operational activities, embedding business opportunities into offerings and empowering consumers on entrepreneurship.
While there are many complex levers to pull like lowering price or seeking government support, one thing companies can explore to improve their commercial value and keep doing important work is to improve the consumer perception.
Perception is where it all happens for the consumer.
The logic is simple — how consumers think of your product influences their decision about it. As consumers increasingly perceive your product to be a valuable asset for improved economic and social well being, they become more likely to buy on impulse, save or take a loan for it.
So in what areas can you influence consumer perception to drive increased demand?
The Primary Stuff.
Price: Regardless of their socio-economic status, all consumers are price sensitive. The consumer’s perception of price is influenced by their preferences, existing alternatives available to them and the context in which you present your product/service. It pays to constantly understand the price perception your key consumers have about your solution and how you can leverage or change it to drive demand. Questions around what frame of reference consumers have on the price of your product, how best to frame your price and how to reduce the pain of spending can help improve consumers’ perception about the price of your product.
Gratification: The pay-as-you-go model explored by PAS Solar is a good example of how to build both instant and continuous gratification into your products through pre-commitments in exchange for continuous rewards of power. Although consumers pay more long term, this model alters their perception about price because of the continuous rewards they enjoy. It might not be financial but it helps to think of tangible incentives you can build into your product.
Loss aversion: Consumers want good quality, yes. But consumers will stick to a product they have used for years. Why? When in doubt, people stick to the familiar. Despite the many upside benefits of clean energy solutions, consumers over-index on the possible risk associated with the use of a new, unfamiliar solution — and with limited finances, there’s more benefit in sticking with the status quo. Worth asking is — how do you minimise the risk of regret with consumers? Lenient pricing structures, warranties, reviews, strong customer support, mental and physical availability are examples of ways to do that.
Symbolic Value: People make important life decisions based on how their choices will be perceived by others. The idea of a gas cylinder outside your kitchen in a compound where everyone uses the Kerosene stove can influence the decision to purchase one for the feel-good expectation that others will notice. What social benefits can your customers enjoy with your product? Symbolic value is why portable Tiger Generators are called “I better pass my neighbour” in Nigeria.
Value offerings like “Clean” “Noiseless” “Odourless” and “Safe” are important but often viewed by the consumer through the lens of convenience. It’s our desire for consumers to change behaviour based on these attributes but most Nigerian consumers aren’t there yet.
