Andy BeckMonday, December 22, 2014
Data. Sensors. Controls. Efficiency. Dollars per square feet. More Data. Dashboards. Retrofits. Energy Savings. These were the terms circling the room on the 32nd floor of the hotel that hosted the Cleantech Group’s Buildings Get A Brain Summit last week in San Francisco. The Cleantech Group was gracious enough to offer an invitation to Makovsky Energy & Sustainability and the trip west was certainly worthwhile.
The audience included the best of the best in the world of “smart buildings”—an emerging industry focused on integrating the technologies of today, into the buildings of yesterday and tomorrow. The open forum discussions hoped to tackle these challenging questions:
- How does the accelerating flow of data from buildings, utilities, and third parties disrupt traditional building operations?
- Will today’s emerging technologies close the so-called “energy efficiency gap” and enable the billions of dollars in potential savings reported by experts?
- What types of companies and business models will seize on these trends and define the future energy services market?
- What do the buildings of the future look like?
The intelligence in the room was clear, but confidence in the sector seemed as foggy as a Bay Area morning. The companies present all have the capabilities of attaching sensors to just about anything inside a commercial building to gain data on energy performance. They’re finding ways to measure energy consumption on just about anything: boilers, generators, lighting, HVAC systems, windows, servers…you name it, one of these companies can figure out a way to slap a sensor on it and receive data. The disconnect is, “what the heck are you supposed to do with this data?”
Here’s an example. Ok, the lighting in a building is consuming 60% more energy than an LED retrofit would. But the LED retrofit will cost, say 3x as much as the current fluorescent fixtures. And the building owner is contemplating selling the property in three years. Will the energy-efficient retrofits translate into a higher listing price on the property? If yes, how much? Can you put a price tag on efficiency? (Client plug: Hubbell Lighting has introduced a program called createchange® that offers financing for lighting retrofits. They also have a Cash Flow Positive program—both of which incentivize and push the customer over the tall hurdle of hefty upfront expenses.)
Another example. How about an app that tenants can download that allows them to fine-tune the air conditioning in their particular office space. Sounds awesome, right? But who’s going to pay for it? The building owner. But then the benefit is passed directly onto the tenant/ end-user. Sure your AC bill may go down if one particular floor enjoys a warmer climate, but again, what’s the price on being cool?
As one of the only PR professional in the room, I was in education mode off the bat. Immediately taking notes and figuring out where the industry is and how it can move forward. Shortly into the first day however, I saw a PR role. These companies were touting their products as revolutionary. “We use big data to save up to 70% of energy usage in a building built in the 1920’s! That’s amazing!” Yea, but how are sales? “Every deal’s a struggle.”
This is where strategic communications and customer engagement is critical for a new industry to educate the public on the clear and real benefits of their technologies. An old adage goes, ask an engineer to sell you a can of Coke and he’ll tell you what type of aluminum the can is made of and the color number of the red paint. Data and app-based dashboards may fly in Silicon Valley, but I can’t imagine a facilities manager in Iowa being too impressed with a number of these products.
“Vaunting product attributes—the default marketing formula among many companies—will only move the needle so far. What’s often lacking is the missing link: direct marketing to end-user customers, based on genuine insight into how the products benefit end-users and addresses their needs.” That’s a quote from an article written by Andy Beck, EVP at Makovsky Energy, which was featured in Fast Company. And I’m not saying it’s wholeheartedly true just because Andy’s my boss—this is absolutely critical for companies to realize.
As I noticed and noted, this space presents a whole host of challenges for new and emerging technologies. But it’s also a time when marketing focused on end-users can pay major dividends for companies in the smart building sector—precisely because so few are doing it. For those who take the step forward, it could well be the missing link in boosting sales and visibility among those who ultimately have the power to take organization—and the industry—to new heights.