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ePower Systems – Marketing Strategy
ePower offers utility firms an electronic bill presentment and payment solution that provides them cost savings and new revenue channels. The benefits to utility billers are as follows:
- Direct connection with customers.
- Reduction in operating expenses associated with billing.
- Reduction in working capital requirements.
- Superior data management.
- Control over branding.
Since ePower is currently developing a prototype version of its CustomerDirect solution, the company will need to follow a marketing strategy that involves two phases. Marketing in Phase 1 will be targeted at utility firms that can be partners with ePower in the development of CustomerDirect. Phase 2 marketing will involve the successful rollout of CustomerDirect to targeted utility firms. Each of these phases entails different strategies with respect to target customers, pricing, and promotion.
The primary goal in Phase 1 is the successful development of CustomerDirect. Secondary goals include establishing credibility within the utility industry and access to resources. This phase is estimated to last 6 months.
In Phase 1, ePower’s ideal target customer should fulfill the following criteria.
- Provide access to IT systems and data files to develop CustomerDirect.
- Provide beta-testing site for ePower’s services.
- Possess advanced billing and customer care systems.10
- Substantial credibility within the utility industry – necessary for Phase 2 growth.
- Willing to share personnel and industry knowledge with ePower.
Pricing – Phase 1
During Phase 1, ePower will partner with its initial customer to develop the product. ePower intends to attract customers who meet the above mentioned criteria, by offering free services for the first six months after beta testing. ePower may extend this price moratorium for another negotiated period if it needs to attract key customers for development of CustomerDirect. This price structure will be congruent with goals set for this phase.
Communication /Promotion – Phase 1
Promotion of this phase will be through direct meetings with upper management of firms fulfilling Phase 1 customer criteria. Additionally, ePower will also target firms (e.g. Gemini, Banner, etc.) that are currently installing billing systems at utility firms, to acquire those utility firms as phase 1 customers.
In this phase ePower will roll out its CustomerDirect solution to other utility firms. ePower’s acquisition of billers will ramp up gradually to total approximately 80 billers by year 5 of service.
ePower’s customers in Phase 2 will fulfill the following criteria:
- “Early adopters” and “innovators” of technology within the utility industry.
- Located in areas with high Internet usage.
- Possess sufficiently large customer base to generate greater transactions for ePower.
Pricing – Phase 2
ePower will utilize a combination of fixed and variable fees to charge companies for the use of the ePower services. These fees may be flexible depending on the size of each customer.
Monthly Subscription Fee
This fee is the per month subscription rate for ePower service. This fee will be $5,000 per month. This is meant to cover the intangible but critical value added benefits of the service, including:
- Facilitating customized bill presentment, marketing and promotion by working closely with the utility to help them develop and maximize this new medium of direct customer contact.
- Setup costs for registering new consumers.
- Analysis of billing data to enhance targeted marketing initiatives and customer profiles.
- Online access to company and billing information through hosting web content thus providing better customer service and data access.
- Advertising & Promotion – reduction of paper stuffers.
The transaction fee is assigned per bill processed. This will be $0.40 per transaction. This fee is meant to include the incremental value to the biller per transaction, including:
- Accounts Receivables Reduction
- Printing/Paper savings
- Postage savings
- Handling of paid bills, data entry
- Check Processing Fees
Communication / Promotion – Phase 2
Promotions to attract Phase 2 will begin in Phase 1. Promotions in this phase will be on a larger scale and will occur simultaneously at multiple locations.
- Direct meetings with target customers and on-site demos.
- Utility industry trade shows and promotions in magazines to increase ePower’s awareness.
- Joint promotions with strategic partners who install billing systems within utility firms.
- Direct marketing will be targeted at upper management of utility firms. ePower’s founders will be responsible for initial contact and sales efforts for CustomerDirect.
The execution of successful services to an established utility company (Phase 1) will provide ePower the credibility and track record to attract new customers in Phase 2.
Signing up end-users /consumers
Household consumers will sign up for electronic bill presentment either from hearing about ePower directly or by the biller’s advertising of the service included in current monthly paper bill statements. The utility firm has significant incentive to encourage its customers to sign up for ePower, as it realizes benefits for each customer enrolled, as well as amortizes fixed costs over a larger online customer base. In this way, ePower and the utility firm are co-marketers and partners, both striving to encourage customer adoption of the service.
The consumer may sign up easily by either checking off a box on their conventional monthly bill stub, or by accessing the www.payabill.com web site. In either case, the customer provides their active email address and payment information (cancelled check from their account). The customer can select any preferences in service, including whether they prefer to pay via the www.payabill.com web site or through direct email, and whether they want to authorize each payment individually, or authorize automatic payments. ePower will input this criteria into the customer payment information in the system database.
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Questions? Call 1-800-payabill or go on the internet to www.payabill.com
11 ePower financial projections. This number was based on a average end-user (consumers using CustomerDirect) base of 250,000 per biller. If ePower acquires billers with more customers it reduces number of billers acquired by year 5.
|Table of Contents||Appendices|
|1. Executive Summary
2. The Industry
3. Company Description
4. ePower’s Services
5. Market Research
6. Marketing Strategies
8. Financial Plan
|All information herein is confidential and belongs to ePower Systems|