For years companies have targeted consumers with advertising that leverages social pressure – like saying seven out of 10 people prefer a certain brand of toothpaste or laundry detergent. More recently, that kind of thinking has been used not just to sell products, but also to change behavior.
“Behavioral economists assert that in the absence of price signals, policymakers can change people’s behaviors by harnessing their natural inclination to conform to social norms,” wrote Nola Hastings and Galib Rustamov in a 2015 report on customer water use messaging for the California Urban Water Conservation Council. “For example, customers make decisions based on social cues, self-image, local values and identities.”
Basically, most of us just want to fit in with our social groups. And if given a little direction on how to do so, we’ll respond.
Opower, a customer engagement platform for utilities, took this philosophy and tested it in the electric utility sector. In 2008, it began sending Home Energy Reports to its utility partners’ customers, which showed people their energy consumption and how it compared to other similar households. The company now works with over 100 global utilities and its use of “social norms messaging” has begun to gain traction with water utilities.
The first substantial research that emerged from the water world on this front resulted from a June 2012 to June 2013 pilot project between 10,000 customers of East Bay Municipal Utilities District in the San Francisco Bay Area and WaterSmart Software. Much like Opower’s model, WaterSmart Software sends Home Water Reports, which tell customers how much water they’re using, how it compares to their own past use, as well as how much water similar households and similar efficient households are using. The reports also provide information on how to increase water efficiency, available rebates or other messaging from utilities.
The project compared two groups to controls – the first being a random sample of customers and the other (referred to as the Castro Valley group) were those thought to be “good candidates” for the messaging (mostly higher income and higher water use households).
Researchers found that the random group on average increased conservation by 4.6 percent and the Castro Valley group by 6.6 percent compared to the control groups. The effects went beyond just conservation, though. They also found that households from both groups were 6.7 times more likely to participate in a water audit program and 1.7 times more likely to participate in a rebate program than those not receiving Home Water Reports.
Another study is under way by Steven Buck, assistant professor at University of Kentucky. Buck is examining how customers may be changing water use behavior in the city of Folsom, California, near Sacramento.
Folsom’s water agency signed up to work with Dropcountr, mobile and online application that tracks and shares water-use information. Customers in Folsom can voluntarily sign up for Dropcountr and create a customized household water budget. They’ll also receive information about water usage, how that usage compares to neighbors, specific tips for reducing water use and notifications about abnormal water usage.
“We are comparing households that enrolled versus households that didn’t enroll in the program and looking at what happened to consumption two months, three months, six months and 18 months after enrollment,” said Buck. Because the people who enroll may be more likely to conserve already, he said they are not simply comparing the difference between the two groups but, “we are taking into account the fact that there were baseline differences between the group that enrolled and the group that didn’t.”
Buck’s research has yet to be peer-reviewed, but his preliminary findings show that on average, those who enrolled in Dropcountr in Folsom had a 6 percent drop in their consumption since enrollment. And that number jumps to a 12 percent drop for the very highest water users.
The city has roughly 24,000 accounts, and 3,300 have enrolled in Dropcountr.
Folsom customers also have the added bonus of having water meters that relay data every day, instead of monthly or bimonthly. “There is more to learn about the usefulness of having daily water readings,” said Buck. Without them “it’s harder to detect a leak and hard to see a response in consumption.”
And Buck stressed that his research with the city of Folsom and Dropcountr is just beginning. He wants to look at how the results persists, if they would find the same results if it were not during a drought and which attributes of Dropcountr drove the effects.
One thing is pretty certain in the industry – the typical format for water bills from many agencies aren’t very good at conveying important information.
“Even though you’ve received a water bill in the past, the info may not be so salient or transparent to the user,” said Buck. Many people receive water bills that measure use in units or cubic feet, which aren’t easily understood by most customers.
“Dropcountr provides a simple visual on how much water was used and when it was used,” said Don Smith, Water Management Coordinator with the city of Folsom. “The daily use graph provides 24 hourly data points that show the customer how much they use. Dropcountr provides current information on how their conservation efforts are working.”
And, many people simply disengage from their bills altogether, said Jeff Lipton, director of marketing at WaterSmart Software. That’s why WaterSmart sends water reports separately from bills because they are more likely to be read.
Increasing conservation and efficiency, however, isn’t the only helpful result from companies that increase customer engagement with their water utilities.
“The reduction numbers of 6 percent to 12 percent are great, but are only part of the story,” said Smith. “Dropcountr provides a platform for customer engagement. We can communicate through email and mobile devices with customers who use Dropcountr and we can monitor usage of all our customers.”
Utilities can use these tools to communicate important information with customers – something that is especially useful during droughts, but not just limited to times of water shortage.
Portland, Oregon, for example, is using WaterSmart’s Home Water Reports to try and reach low-income customers to help promote customer assistance programs and increase efficiency to reduce bills, said Lipton.
“What we see the need for in the water space is better customer education and engagement around a variety of topics and the ability to build political support for infrastructure investments so we don’t have Flint, Michigan, happening all over the country,” said Lipton. “In some cases the need to improve efficiency is important but there are lots of other things utilities need to address with customers.”
Utilities may want to communicate about how they are spending money on new infrastructure or the costs of maintaining quality service that may help customers better understand how their rates are set and the money spent.
“Social norms messaging can be used to drive behavior in different directions,” said Lipton. “It’s really important the way we’re able to leverage behavioral science insight to achieve measurable outcomes that utilities care about it.”