The solar market moved into the ‘late majority’ market phase in June 2019 (figure 1). The problem is most solar retailers have not moved their lead generation and sales practices out of the ‘early adopter’ market phase to address the changed market.
What can we expect?
In the ‘late majority’ phase most people will already have some exposure to solar. We can expect increasing regulation; we can expect to see a market consolidation of solar sales companies and the failure of many small solar vendors. To manage documentation complexity of increasing Government regulation we will see fewer and larger installation companies starting to dominate the market.
For example, a consumer in Victoria (and likely in the rest of Australia soon), to receive the State Government rebate and interest-free loan, must purchase from an accredited sales company. To achieve accreditation to sell solar (not install) in Victoria a solar sales business will need to sign up to the CEC accredited solar retailers code. Of course, this is not mandatory, and a solar sales company can continue to sell, however, they will find the going very tough indeed.
Solar Sales process changes
I also expected to see big changes in the way solar sales companies approach the market. I was sadly disappointed.
Over last weekend, as we moved into the new financial year and in a manically busy solar market, what are the messages solar lead generators and installers are advertising?
- Are you spending too much on your electricity bills?
- Save 80% to 90% on your bills today.
- Go solar for $0 upfront
- Are you still wasting your time and money on uninterested three quote leads?
- Don’t miss out. New rebates going live soon. Zero deposit. Limited numbers. Don’t get left behind.
What motivates a solar sales company and a solar buyer?
The ideal sales lead is with a motivated buyer. Someone who is emotionally invested in making a decision.
My guess there is not one household in Australia who has not received at least a few calls from telemarketers. I receive a call from a call centre at least once a week, and often every day. They ask the same questions they asked ten years ago and I give them the same answer.
When I first became involved in the solar industry (2008) every lead was gold. Appointments were with people emotionally engaged in preventing climate change or reducing their carbon footprint. More often than not price was a secondary issue. With an over generous government rebate and excellent finance packages many solar sales companies made a lot of money selling to innovators and early adopters. They generated leads and sold to the emotional needs of their clients. Most of the big names of that time are now in the solar graveyard.
Today’s lead generation services and solar sales companies continue to produce leads and sell in the same way hoping to recreate the enormous cash returns of the early solar sales companies. Leads generated today, using government incentives as a hook, are with buyers who really have no emotional investment in making a decision. If they are buying to get a government rebate, for no money up front, or the fear of missing out then they are not a motivated buyer – there is no emotional investment in the decision. If they buy, they will tend to buy based on price. There are no mountains of cash and most solar sales companies starting today are likely to fail if they do not get to a critical mass very quickly.
Boundless leads and high close rates
The only Lead guaranteed to be unique and with a motivated buyer is the one you create yourself.
I observe solar sales companies we work with every day. There are a few real gems who have regular leads, keep their sales team busy and close almost all the leads they work for little effort. Others have a strong flow of leads which keep their sales team busy yet close as few as 20% of them.
Understanding the market, the emotional drivers of buyers and using lead generation techniques designed today’s market will allow you and your sales team generate boundless leads, close a much larger proportion of those leads at a better margin.
To test if your lead generation program is focused on the ‘late majority’ market ask the question ‘how would we sell if there was no Government support?’ For commercial sales over 100kW the LGC price is now so low this is almost true, yet this is the part of the market growing the fastest. Look at other products your target markets are buying without government support and ask what they are doing to get leads.
The ASM Money Lead Generation workshop we run with our members helps you to match your marketing effort to today’s solar market.
Author: Gregory Ferrett – Solar Finance Specialist & CEO ASM Money
