Insights

Switching On: What Energy Retailers can Learn from the Changing New Zealand Landscape
Article

Switching On: What Energy Retailers can Learn from the Changing New Zealand Landscape

Over the next decade, the New Zealand population will undergo some profound shifts. Larger households, ethnic diversity, ageing consumers, increased device usage and growing concern about the environment, will all need to be factored into future marketing and advertising planning for companies and brands. And this is especially true for energy retailers.

A recent Nielsen presentation at the Downstream Energy Conference highlighted three key consumer trends that energy retailers should consider when reviewing their customer base and the best way to engage with them.

1. CHANGING HOUSEHOLDS – PARTICULARLY IN AUCKLAND

Auckland is growing fast; by 2026 it is expected to be as high as 1.6 million people – an increase of 50% in just two decades. This surge in population growth is expected to put an unremitting amount of pressure on the city’s services and infrastructure. The energy sector will need to plan ahead to cope with the increasing demand for energy this trend will bring.

Auckland’s households are also getting bigger. The number of households that have five or more people living in them has jumped by 51% over the past 10 years, and is projected to reach 150,000 by 2026. The rest of New Zealand, while more likely to have smaller (1-2 person) households, still experienced a 22% increase in large households versus 2006, and we expect this trend to continue.

Larger households also means more devices in the home – most of which require electricity to power up. The number of mobile phones and tablets in the home has increased by 64%. There is less congregating in a single room to watch content on a big screen; and a growing trend toward individuals watching content on their own devices in different rooms in the house. Energy requirements will undoubtedly shift as Kiwis need to heat more than the single room to keep warm in the evenings.

Auckland is the multicultural heartbeat of the nation where diverse cultures have congregated. The consumer demographic profile of the city is very different compared to the rest of New Zealand.

Almost one-in-three (31%) people living in Auckland hail from countries outside of Europe and the Pacific – three times larger than the rest of New Zealand (10%). Outside of Auckland, New Zealand Europeans still account for 71% of the population (compared to just 49% in Auckland).

These trends highlight how important it is for marketers in the energy sector to consider devising an Auckland strategy and a non-Auckland strategy to ensure the very different needs of those inside and outside our biggest city are met.

2. AGEING POPULATION

By 2026 we expect at least 44% of the population to be aged over 50. Right now, 20% of those aged over 65 are in paid employment and this is expected to reach over a quarter in 10 years’ time.

For the energy sector, this shift could mean reduced power bills for this growing group of older working consumers who are more likely to use the air-conditioning in their workplace instead of at home.

Our research shows this group of consumers are very loyal. More than half of consumers aged over 65 say they are satisfied with their energy provider. And considering this group typically have higher disposable incomes, brand owners should ensure they do not ignore this sector of the population.

3. ENVIRONMENTALISTS AT HEART

Close to 1.8million people (45% of the population) agree with the statement: “I am an environmentalist at heart.” And almost 2 million Kiwis say there is not enough done to protect the environment.

Of Environmentalists at heart, 900,000 people (23% of the population) also agree they are “always looking for ways to make their home more energy efficient”. In illustration of this, as many as 45,600 households say they plan to install solar power in the next 12 months – an increase of 31% versus a year ago.

REACHING YOUR CONSUMERS

With everyone consuming different media content on different screens in different places, reaching the specific customers you want to connect with, can be challenging. It is important that energy companies formulate communication strategies that span across all consumer devices. Profiling your target consumer groups is imperative in ensuring your marketing and advertising messages are tailored, compelling, achieving cut-through and reaching them on the right device at the right time.

ABOUT CONSUMER MEDIA INFORMATION (CMI)

In this environment, breadth of understanding of consumer attitudes, media consumption and their day to day behaviours is essential. Nielsen Consumer and Media Insights provides views of consumers you want to identify, understand and then reach. Meaning you don’t rely on too narrow a view of a customer. The data is gathered via an independently audited survey of 11,000 New Zealanders aged 10+. It uses mixed methodology of face-to-face (75%) and online (25%) interviews, combined with a self-completion diary. The sample is then weighted to Statistics NZ population data for national representation.