Highlights from the First Growing Gallons Conference - Warm Thoughts Communications
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Highlights from the First Growing Gallons Conference

Posted on June 19, 2017

Attendees from 23 states at the
Growing Gallons Conference

Propane Association execs and board members from more than 20 states recently attended the first Growing Gallons Conference, organized by Warm Thoughts Communications. Warm Thoughts partners with state associations throughout the country to create marketing programs that engage members and help them increase the amount of fuel they sell. Participants were treated to a substantial agenda focused on the mission of “growing gallons” and animated by the theme of “sharing the wealth”.

Stuart Weidie Opens the Conference

Stuart Weidie, the outgoing chairman of NPGA and the CEO of Blossman Gas, one of the largest propane retailers in the United States, opened the meeting by congratulating the audience on embracing the vision that it is possible to expand the pie. “When we grow gallons, it is more motivating for employees to come to work, it encourages more companies to get involved in associations, and it encourages even more customers to feel comfortable investing in our fuel and appliances,” he said. “By thinking bigger, and by implementing smart strategies within states, we make progress. It is not something that can be left in the hands of PERC, or state groups, or propane companies or agencies like Warm Thoughts. It is something that requires everyone pulling in the right direction.”

New Market Research Reveals More Opportunities Than We Think

One of the highlights of the conference was the release of new market research into the attitudes of propane consumers. Warm Thoughts had funded the project, which was conducted by Reese Associates of Dallas, Texas. Ken Reese, the principle, had previously managed the nation’s largest study of home comfort buying decisions, “The American Home Comfort Study.” He has also conducted research into the attitudes of heating oil consumers in seven states.

Study participants were single-family homeowners who used propane for more than outdoor grilling: 57% used propane for home heating, 50% for indoor cooking, 50% for heating water, 33% for fireplaces, 25% for drying clothes, 17% for generators, 13% for space heaters, and 7% for heating pools.

Warm Thoughts President Richard Goldberg releases new market research

The session started with Rich Goldberg, the president of Warm Thoughts, asking the attendees to estimate the satisfaction their own customers have with the fuel (including both those who would describe themselves as “somewhat satisfied” and those who would say they were “very satisfied.”) Answers ranged from a low of 25% to a high of 92%, with most clustering around 55% to 60%. According to the survey, however, 92% of customers said that they were satisfied (59% very, 33% somewhat). The researchers said that this number was very high, with the  “very satisfied” contingent 15% higher than oil heat customers. What’s more, satisfaction levels were pretty consistent among all incomes and age brackets, and across all types of uses.

There were other important and, in some cases, surprising findings:

When customers were asked whether they would be inclined to purchase propane appliances for other uses in their home (which they were currently fueling with oil, electricity or natural gas), on average 60% said either “very likely” or “somewhat likely.” The strongest response was for water heaters, generators or home heating; the lowest was for pools or drying clothes.

The survey dug into the key factors influencing the purchase of these appliances. For water heaters, for example, the dominant factors were: energy efficiency (70% cited it as “very important”), cost (64% said “very important”), and the ability to produce hot water quickly (60% said “very important”). Rebates and brand differences actually scored the lowest of the nine categories: only 31% said they were “very important.”

This does not mean that rebates aren’t valuable, especially as they help bring down purchase costs. It does mean that they may play a more important role if we can use them to also attract customers to our pro-efficiency and pro-recovery-rate advantage. And the conference’s next session showed a real-life example in North Carolina where that was in motion with exceptional results (see below).

Some of the findings illustrated challenges facing the industry:

More than a quarter of the respondents who said that they were not inclined to purchase a propane water heater explained that it was because they didn’t even know they were available. Safety (42%) and cost to operate (31%) were the top two objections.

Of the customers who had already bought a new heating system, 50% said they never thought to consider propane, or didn’t know it was an option. 35% didn’t know what kind of services their propane company offers. 62% said they researched their equipment purchases by reading online consumer reviews. Next up—research on the internet at 59%.

This was the first time in a Warm Thoughts survey that the recommendations of friends, families and coworkers dropped from the number one influencer to number three, at 52%. It was surpassed by reading reviews and conducting research on the internet, at 59%.  Clearly, having a strong online presence and strategy is vital to growing gallons.

Best Practices: Using State Association Funds to Grow Gallons

Case Study: North Carolina Breaks the Mold

By sharing what has worked in different states, participants hoped to bring back ideas to implement on their own. One of the highlights of the conference was a deep dive into North Carolina’s groundbreaking campaign to grow gallons. While NCPERF, the state PERC, was able to invest significant dollars in this effort, some of the lessons are applicable to any association.

Three years ago, North Carolina’s Propane Gas Association succeeded in getting a state check off program authorized so that it could more effectively battle for market share. As John Jessup, the NCPGA executive director explained at the conference, the goal of the campaign wasn’t just to increase rebates. The association wanted to find a way to energize more propane marketers in the state, enlist potential trade allies, and engage more consumers in the benefits of propane.

Working together with Warm Thoughts, Jessup and the NCPERF board developed an innovative strategy. First, they surveyed their members to help prioritize their activities. Then they launched a three-pronged attack that integrated digital promotion (a North Carolina propane website called propanenorthcarolina.com), social media (a Love My Propane North Carolina Facebook page) and member-delivered bill inserts (Propane Matters in NC).

Jessup reported that, as a result of the approach, appliance rebates have increased more than 400%, member excitement has taken off, and Rinaii recently announced that it sells more tankless water heaters in North Carolina than in any other state. Due to the success of the campaign, it has now been expanded to include propane furnaces, gas packs, hybrid heat pumps and more. He estimates that hundreds of thousands of gallons have been added or retained as a result.

Warm Thoughts Vice President Ben Gutkin reviews North Carolina model

At the same time, the presenters were quick to point out that the goal of the campaign is not just to generate rebates. It is to draw attention to the benefits of propane appliances, create a social community of propane users, and overcome some of the obstacles outlined in the market research. As Ben Gutkin, Warm Thoughts’ VP, put it, “The rebates are not an end in themselves. They are a way to capture homeowners’ attention and focus them on the benefits of propane.”

How did it happen?

The Propane Matters in NC newsletter is available for dealers to order to use as a bill insert for their customer base. Based on previous PERC and state initiatives, they expected no more than 30 members to order. But marketers were huge fans of the product. Right out of the box, 70 marketers started sending them to their customers. Today, more than 100 marketers are using the newsletter, delivering it to 285,000 propane customers across the state twice a year.

While some members originally questioned whether anyone would have interest in a propane based Facebook page, the Love My Propane North Carolina Facebook page now has more than 30,000 followers (after just 18 months). This is more than any other propane-related social media site in the country, by far. Over 1,200 customers a year have clicked through from the Facebook page to the website.

The website www.propanenorthcarolina.com has been visited close to 40,000 times in just two years, a huge number. A very strong percentage of these visitors are taking some action—downloading a rebate coupon, using the marketer locator, calling for more information, etc.

North Carolina has also reached out to plumbers and other allies in the trades to engage them in its big campaign, and, for the first time, it is getting support and participation.

How to apply this in your state.

A number of participants attending the conference said that they don’t have the resources available that  North Carolina has. Rich Goldberg pointed out that, “sometimes, you can’t sprint to your destination. You have to walk more methodically, but as long as you are heading in the right direction, you will make progress.” That assertion was echoed by representatives of some of the other states, like Minnesota and Missouri, which have implemented some parts of the Warm Thoughts/NCPGA approach, and are starting to see positive movement.

Gutkin said, “There are ways to scale down the promotional costs that can still yield good impact, if you handle them right. But it’s important to move beyond the idea that the goal is just to generate rebates. It’s about engaging customers to consider propane appliances, and the rebates are bait to lure them into a deeper conversation.” Jessup added, “The most important thing you can take away is that you absolutely can grow gallons, with the right strategy and execution.” He continued, “We all have too much on our plates. So it is essential to work with a firm like Warm Thoughts that can help you think through this stuff, and then run with the ball after agreeing on strategy and budgets.”

Keynote Address: Increase Member Engagement

Keynote Speaker Reggie Henry discusses ways to engage members

The keynote speaker of the Growing Gallons Conference was Reggie Henry, the chief information and engagement officer of the American Society of Association Executives. While Henry aimed his remarks most directly at state Propane Gas Association executives, some of whom were his members, state members in attendance found interest in the presentation as well. His main points included ways to increase member engagement and build a stronger association in the digital age. Henry spent a good deal of time exploring how associations need to engage their members where they now live, which is on their mobile phones. Mobile phone use is growing at 58% year over year, and time spent on the devices is growing 117% year over year

Henry pointed out that mobile apps are the predominate way that people are interacting with the companies with which they are regularly doing business. The demand for mobile apps has grown primarily because they offer a quicker to accomplish the task at hand than connecting to a website.

Henry also recommended using tools like Microsoft Office 360 to organize emails and various communications around committee groups and subgroups, as well as around topics. He said that it makes collaboration between staff and members much more productive and convenient.

Creating and Managing State Check-off Programs

Missouri State Executive Steve Ahrens led a lively session digging into lessons learned for starting and managing state PERC programs. Many of the attendees were surprised to hear that 13 states now have a check-off program in addition to the 20% share of PERC assessment dollars that each state receives. Participants included executives from some states (like Missouri and Minnesota) that have had funds for over a decade, others (like North Carolina) that launched their program in the last five years, and many others that were in various stages of trying to make it happen. Each state has different circumstances and different political/marketer landscapes, but some common themes emerged:

 

Ben Gutkin
is VP Marketing Services for Warm Thoughts Communications. He has advised dozens of the nation’s leading energy companies and associations on improving their web presence, search capabilities, direct response advertising and return on investment during his 20+ years with Warm Thoughts. You can reach him bgutkin@warmthoughts.com or 201‑330‑9276 ext. 227

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