In union circles, they call it "burial insurance." That apt phrase denotes the severance, early retirement and re-training packages negotiated for veteran utility workers sideswiped by a changing...
Marketing & Competing
to the advent of competition to preserve market share and acquire new customers. Recent reengineering to the contrary, the AT&T experience should signal caution to any company facing deregulation.
There is yet another compelling reason for utilities to develop a brand identity: crises. Though variously defined, crises are a staple of life in the utility industry. From power outages to customer outrage, electric utilities face a wide range of potential crises every day. According to a Yankelovich survey, companies with strong corporate brand and positive image were more likely to weather and recover from a crisis. About 57 percent of companies with "above average" corporate image ratings were not seriously affected by a crisis; only 5 percent of firms with a "below average" rating survived. The remaining firms struggled to regain lost market share following the crisis.4
I will leave the precise picture of the future of the utility industry to the professional prognosticators. Despite all their sophisticated simulations, it's likely no one will get it quite right. But one thing that seems clear enough to SRP is that a more competitive world will require the retooling of electric utility communications. Customers need to know what a company stands for, what it delivers, and why it provides the best energy value. t
D. Michael Rappoport is SRP's associate general manager for Public & Communications Services, which includes the advertising function. With annual revenues of approximately $1.5 billion and more than 600,000 customers, SRP is one of the nation's largest locally owned electric utilities.
Who Needs Corporate Identity?"It is the comprehensive presentation of what a corporation is, where it is going, and how it is different. Corporate identity seeks to project what makes a company special in order to influence the perceptions and actions of a diverse set of audiences."*
Failing to establish a corporate identity and build distinct brands as the industry approaches deregulation means that electricity could become a commodity, with customers gravitating toward the absolute low-cost provider.
For a glimpse of the future in a commoditized electricity industry, watch traders at a mercantile exchange furiously buying and selling commodities. Just as one bushed of corn is indistinguishable from another, so too will kilowatt-hours be indistinguishable. Price may well be all that matters. *"Corporate Identity: Beyond Name and Logo," Anspach, Grossman & Portugal, Inside PR, November 1992.
1 Estimate from Bob Janke, executive director of Utility Communicators International.
2 Richmond Times-Dispatch, Aug. 14, 1995.
3 Forbes, Aug. 28, 1995, pp. 108-109.
4 "Study of the Past 15 Years' Activities of 489 Companies," Marketing Intelligence, 1992.
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