The coronavirus has shut down many forms of trade, but it poses a particular risk to rooftop solar power. This is a product that, until a few weeks ago, relied on face-to-face contact for most transactions. From now on, such an interaction is prohibited as a public health imperative.
Faced with a potentially cataclysmic change in the business landscape, some US installers are trying new approaches. They find they might be in a better position to sell clean energy if and when things get back to normal.
Before the coronavirus pandemic, many American solar installers sent employees or contractors to ring the doorbell of strangers. They have appeared at community gatherings and big box stores with stalls and literature to showcase their wares. Even when customers contacted online, the next step was often to send a sales representative to finish the conversation at home.
“Kitchen table selling is an integral part of the solar selling process,” said Vikram Aggarwal, founder and CEO of online solar marketplace EnergySage. “Businesses really want to get down to the kitchen table. “
The loss of this crucial tool portends a tough time for residential solar companies, compounded by wider economic disruption. Some companies get by by reducing their expenses; others have opted for layoffs.
A contingent of entrepreneurial and tech-savvy businesses are trying a different route: asking how to best sell without face-to-face meetings. They saw a small ray of hope in the midst of the chaos: technology makes it relatively cheap and easy to transfer operations online; it is always possible to do business this way; and a digital-centric strategy might be better for businesses in the long run than the historical reliance on face-to-face sales.
“For companies who are reluctant to [discontinue] face-to-face sales will be a big blow, ”Aggarwal said. “Companies that are ready to adapt and adapt to the reality of how consumers want to be solicited or prospected, they will be extremely successful.”
The essential sales tool is no longer
The use of face-to-face conversations varies from company to company, but residential solar energy experts agree that it has played a central role in sales strategies at all levels.
EnergySage recently published a poll with responses from 772 solar installers in 48 states. Only 11% of those surveyed said they regularly use door-to-door sales. But more popular techniques also result in face-to-face contact, such as community events (20% frequently use this method), direct sales (41%), and referrals (77%).
“Previously, probably 90 to 95% of our closed sales had some sort of face-to-face meeting,” said Wil Ralston, president of SinglePoint, which owns solar concierge business Direct Solar America. “This is how solar power has traditionally been sold. “
SinglePoint is a publicly traded company that buys other companies and helps them scale. It acquired the solar business in May 2019. Since then, it has grown from selling in eight states to 25, and it now employs 60 people. Direct Solar America does not perform installation, but manages sales and provides customers with financing options and local contractors.
Now he does it from a distance. “No one is letting anyone into their house right now” for sales conversations, said Ralston.
The rush for digital alternatives has started. Now, instead of walking around the yard and imagining signs on the roof, reps go through the same details on Zoom, GoToMeeting, or Google Hangouts.
Instead of attending local fairs and festivals, upstate New York’s community solar company, Astral Power, has switched to Facebook parties and virtual learning lunches, said co-founder and chairman Thom Smith at GTM. Door to door has given way to “social canvassing” on Facebook and Instagram.
The solar design and proposal process had already gone digital, with software tools like Aurora visualizing the house with solar panels in place. Funding requests were already digital. The main change, then, is that sales reps feel comfortable selling through a display, and customers feel comfortable making a virtual five-figure purchase.
Direct Solar America now sees approximately 40 customers per week through the online channel and is recruiting for additional online sales positions.
“We’ve had to either switch to the in-line model now or take a serious hit this year,” said Ralston. “We’re not where we were yet, but we’re getting back to it very quickly.
Only 11% of installers surveyed frequently used door-to-door prospecting, but many of the most popular techniques also relied on face-to-face meetings. (Image credit: EnergySage)
Online doesn’t have to be scary
The question is whether enough people feel comfortable buying solar power online to support a growing domestic industry.
It’s too early to fix this issue based on empirical evidence, but sources have pointed out a few reasons why the industry’s conventional wisdom here – that solar must be sold face to face – may be incomplete.
On the one hand, solar energy’s thirst for proximity makes it an outlier in today’s economy. How many high-tech, fast-growing industries depend on employees knocking on doors and entering homes to finalize a sale?
Other industries have found appeal to consumers by selling big ticket items on the Internet. Tesla sells much more expensive luxury vehicles on the web – and has weathered the solar industry trend when it comes has also moved its signs to online sales.
The move sparked skepticism from those in the industry who did not see how solar power could be sold remotely. But Tesla presented his unorthodox strategy as a response to persistence customer acquisition costs that have weighed on the industry for years with no sign of slowing down (the jury is still out on the success of this, although Tesla reversed its declining quarterly solar sales months later).
“The solar industry is always talking about customer acquisition,” Aggarwal said. “In line [sales have] has radically changed the cost structure of virtually every other industry, so why not solar power? “
Aggarwal, of course, runs a dedicated platform for bringing the solar selling process online. But EnergySage’s survey shows that this approach to selling solar power was gaining traction before the pandemic: The sales channel that saw the biggest jump in installers using it frequently in 2019 compared to 2018 was the online auction platforms. This response rose from 10 percent of respondents to 21 percent, while all other channels remained stable.
Clear benefits for solar companies …
Businesses can adopt emergency tactics to survive the current crisis and revert to past behavior as soon as the virus recedes. But extensive digital sales offer lasting benefits for installers and customers.
For solar companies, the digital switchover takes away the logistics of traveling through space and time to secure a deal. No gasoline costs, no hours spent in traffic jams, no arriving at a meeting to find no one there and having to travel many kilometers to return empty-handed.
Lumina Solar, based in Maryland, regularly pays $ 50,000 per year in fuel costs for the fleet *, said co-founder and CEO Mike Kirby. The company, which was launched in 2018 and employs nearly 60 people, still rolls trucks for operations, but saves on travel costs for the sales process. The empowerment of physical travel also creates opportunities.
“We have more confidence to sell into a bigger territory because we don’t necessarily have to drive three hours one way to meet a prospect – we can do that on Zoom,” Kirby said.
SinglePoint had planned to move forward online sales to streamline operations, but had not done so until now, Ralston said.
“This whole situation and what it has forced us to do will only position the company to be more efficient and [have] lower costs, ”he said.
The COVID-19 crisis has forced Astral Power to embrace technologies it may have overlooked before, Smith said. “When we come out on the other side of that, we’ll be really strong, because we’ll have this solid foundation for distance learning, digital tools, and social media.”
… And for consumers
On the customer side, those who love their privacy will now be able to weigh the numbers and make a decision without the pressure of a stranger urging them across the table. For exemplary millennials who have been successful in buying homes, this is almost undoubtedly a more natural way to shop than the previous solar industry standard.
Solar suffers from endless accounts of “hard sell” tactics leaving consumers feeling exploited. What is said in the heat of a personal sales conversation doesn’t always show up in a contract, much to the chagrin of some customers. But virtual sales mean customers can keep track of their interactions.
“If I’m a consumer, I want to communicate officially,” Aggarwal said. “From the consumer’s point of view, online [communication] is obvious. Any industry would do well to give consumers what they want.
Sitting face to face is not a basic requirement for selling solar energy. It is a way to achieve the level of confidence and comfort necessary for an owner to be able to commit. The challenge now is for solar companies to recreate this feeling from a distance.
“Ultimately, sales are about people,” said Smith of Astral Power. “People always want to be able to look you in the eye and shake your hand. Now they can look us in the eye through video conferencing.
Fortunes have been made by those who make tangible connections with viewers through a screen. Solar power vendors should try it out for themselves because, for now at least, no other option exists.
* Corrected to reflect that fuel expenditure refers to the fleet as a whole, not individual vehicles.