PA Utility Banks on Internet to Compete in Dereg Climate

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As two-thirds of Pennsylvania's electricity market became deregulated on July 1, PECO Energy's unregulated spinoff, Exelon Energy, entered the fray confident that it can use the Internet to gain an edge.


Exelon recently completed the second of a series of business-to-business campaigns using a combination of direct mail and banner advertising with the Internet as the sole response mechanism. According to Exelon, the campaign's direct mail garnered a 3.6 percent response rate to its Web site while banners pulled a 2.3 percent response rate, which is about double banner advertising's current average. Also, it said 85 percent of the respondents subscribed to an e-mail newsletter for deregulation updates.


Joe Barone, co-founder of Virtu Inc., the Philadelphia agency in charge of Exelon's online efforts, said the response rates and respondent job titles dispel the current notion that senior executives are difficult to reach online.


"Most people are under the impression that [senior executives] are too old and that they're not Web savvy," Barone said. "This promotion disproved that."


The campaign it completed in May was a sweepstakes aimed at an undisclosed number of energy decision makers at businesses with utility bills averaging $5,000 or more. Exelon offered respondents who supplied their names and business information at www.peco.com/business/pecohorizon a chance to win a trip to the Olympic Club in San Francisco and two passes for the final rounds of the U.S. Open golf tournament there.


For creative, the mail campaign employed a box with a picture of a golf ball on a green and the headline, "If you're ever gonna make it to the U.S. Open, you gotta look inside." Inside the box, was a golf ball and the headline, "Hit our links … www.peco.com/business/pecohorizon … and have a ball on us," along with other promotional copy.


Before the U.S. Open campaign, Exelon ran another BTB sweepstakes using a combination of online advertising and 3,000 pieces of mail also aimed at snagging information from commercial energy decision makers whose firms had electric bills of at least $5,000 a month. That campaign, which ended in February, offered a chance to win a trip to Las Vegas and two tickets to the NASCAR Winston Cup Race at Las Vegas' Motor Speedway.


Addresses for the NASCAR mail effort were compiled from a statewide list of commercial sign-ups for a lottery Pennsylvania used in November to select participants in a deregulation pilot program for 5 percent of the state's electricity market. Deregulation rules forced all the utilities to make those files available to competitors.


The mail list for the U.S. Open campaign was purchased from an undisclosed source.


Though Exelon did not disclose response rates from the NASCAR campaign, Dee Bliss communications manager for the Wayne, PA-based utility, said it pulled more responses than the U.S. Open campaign. However, she said, the U.S. Open campaign resulted in more desirable job titles, like CFOs and plant managers.


"We're calling the U.S. Open campaign a greater success because of all the key job titles in key industry segments we received," she said.


Regional banners on The Weather Channel site at www.weather.com and the Knight-Ridder site Philadelphia Online at Phillynews.com have continually out-performed other sites in terms of response rates and desirable job titles, Bliss said.


Now that the market has opened up, Exelon's marketing efforts will use all types of reply devices, Bliss said. The utility, however, will continue to focus on its Web site as an efficient customer-service medium.


"We want to give people as many different options to respond as possible," she said. "However, we are trying to migrate as much of our business as we can to the Web from a customer-convenience perspective as well as a cost-to-serve perspective."


Exelon has ongoing database building efforts on its Web site like an online quoting service and plans to launch an online metering service in 1999 that will allow Exelon commercial customers to monitor their energy usage on the Web on an hourly basis.


Currently, there are 49 licensed electricity suppliers in Pennsylvania compared with seven before deregulation began. The state is scheduled to complete electricity deregulation Jan. 1, 2000.
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