Good news, solar PV manufacturers (and inverter companies, too). You may not be just a $/watt commodity after all, at least according to some new solar market research that was recently given to me by one of my solar market research friends, Jon Worren of ClearSky Advisors.
I saw Jon at SPI in Dallas, and we started discussing the latest solar PV commoditization trends and what brands had good word of mouth mojo in certain markets… and the others that didn’t. Some interesting findings there for the Ontario market, by the way, but talk to Jon about that. I wanted to know if there was something that I could share here on Renewable Energy World about the U.S. market.
Indeed, there was. Jon and his team had recently completed a New England Solar PV Installer report, which he generously shared with me (and now, some parts of it with you).
The study was conducted in July 2011 by phone and internet responses. Jon’s team got a hold of over 30 large and small solar PV installers in New England. According to their responses, ClearSky said these installers represent over 80 percent of the installation activity in New England in 2010.
There was a lot of good info in the report, though some brand preference data is skewed by Evergreen Solar, once a New England darling, and now a disdained solar PV brand for first, closing down its Massachusetts factories, and second, subsequently closing the doors for good.
But putting Evergreen aside, here’s a more universal nugget that I found in the report that can help solar PV manufacturers compete in New England — if not in the rest of the U.S.
First, no surprise here: On a scale of 1 to 7, with 7 being most important, when choosing a module brand, price concerns ranked highest with an average score of 4.35 for all installers, But here’s the interesting opportunity:
When Clearsky breaks the data down into market segments, price isn’t the most important factor for small installers. Rather, the small installer’s most important buying decision factors are brand, field experience, and service/marketing support.
This makes intuitive sense. Large commercial installers have to be more concerned with $/watt costs to make their mega deals happen and make a profit. However, with small, mostly residential installers, they need all of the customer care and support that they can get.
Small installers have limited staff, limited marketing funds, and many may be relatively new to the solar industry. Consequently, module manufacturers (or distributors) that can offer these installers training, field experience, and marketing support are going to be more prized, and unlike large installers, small installers will be willing to pay more for that extra-mile care.
“I like to be able to get on the phone with a company if I have a problem, even if I’m on the roof,” said one respondent.
Another commented, “I like to have a wide range of sizes at my disposal to ensure that we max out the available roof space.”
And contrary to the widespread belief that brands don’t matter to consumers, at least one installer commented, “I have had poor service from company X when I had problems. But I continue to use them because my customers ask for that brand.”
So it’s possible to give installers bad service and module selection, but you’d better make up for it with a great deal of direct to consumer marketing.
Only you, solar PV manufacturers, can look at your bottom line and say whether it's worth investing into better small installer care and support. Though ClearSky’s data indicates that these added values are more prized than price, let’s not get carried away. They’ll pay more, but not that much more.
Personally, I believe there's a “long tail” opportunity here. There are far more small residential installers in the U.S. than big fish utility scale installers. Collectively, they may increasingly order more than larger installers, especially as the housing and overall economy improves.
And now with almost any installer able to offer a solar lease or solar PPA via a number of recent options — including new PV manufacturer financing products — ClearSky’s data suggests a great opportunity to refocus on pleasing and supporting the many small U.S. installers.
As for inverter manufacturers, Jon had some valuable market data for them, too. On average, across all market segments, price was less of a concern. So, what was the biggest factor for choosing an inverter? The big R: Reliability, with an average 4.19 score out of 7 rating — 7 representing the most important purchasing concern. In second place, performance came in with a 3.52 rating. Finally, price took third place with 3.3 score.
That being said, broken down into segments, once again, the large installers pegged price as being #1, but medium and small installers pointed to reliability. Nevertheless, that overall reliability concern is a sign for inverter engineers to continue to improve and demonstrate long-term reliability, even at the expense of higher upfront cost.
It’s also a sign for inverter marketers to find unique ways to highlight their reliability. Independent test data is wonderful, but inverter marketers might also think about some creative metaphors to go along with those results. That is, what else in the world is reliable and durable? Use your imagination and then create a marketing campaign that ties your reliability and performance data to that metaphor.
To installers reading this post, do you agree with the above study? Are you residential installers willing to pay more for various types of support, whether technical, or module variety, or equal access availability? Please share your thoughts below.
Personally, I’ve heard some nasty and resentful comments about solar PV brands that have reserved some types of modules for certain customers. Now that there’s a current worldwide module oversupply, I wonder if that decision will turn out to be shortsighted.
Something to UnThink Solar about...
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