Putting customers at the heart of a sustainable V2X proposition
HOW WE LEARNT ABOUT THE BARRIERS THAT WOULD PREVENT CUSTOMERS FROM TAKING PART IN A GREENER FUTURE THROUGH BIDIRECTIONAL CHARGING
Electric vehicles (EVs) are crucial for achieving our net zero ambitions, as they enable transportation to be fueled on renewable energy. But even more exciting is that EVs have the potential to ensure that our homes are also powered by renewables through vehicle-to-everything (V2X) technology. With bi-directional charging, EVs can not only take in electricity but also supply it for other purposes – like powering your washing machine.
This transition to EV brings about huge potential, but only if we are able to support customers in playing their part and changing their well established behaviours around car fueling.
Over the last 9 months we, Kaluza, have worked together with Volkswagen Group, OVO and Indra to understand what barriers are present for customers to take part in bi-directional charging. We called this Project INFLEXION which is part of the V2X Innovation Programme, funded by the Department of Energy Security and Net Zero (DESNZ), delivered by Innovate-UK.
Getting creative
Bi-directional charging has proven to be a feasible and viable technology to support the decarbonisation of our energy grid. The UK National Grid also expects V2X to play a meaningful role in the future. However it is yet to scale. Why? We believed that the answer was because we were yet to have a sustainable business model proposed, one that not only answered the industry need but also addressed the barriers and needs of consumers. This was the goal of INFLEXION.
Immediately we had a challenge. How do we understand the barriers to a technology that is yet to be widely experienced, with only around 350 people in the UK having actually used a bi-directional charger?
The answer is to get creative in the ways that we researched with consumers. We needed to use a range of methods that each tapped into different forms of expression and thinking so that we could build up a rounded picture, therefore giving us the best chance of developing a proposition that would see V2X scale.
We learnt about the barriers for V2X by:
Interviewing a range of consumers at different points of their EV journey
Facilitating a co-creation workshop between EV Drivers and Industry experts
Surveying a nationally representative sample of EV Drivers and EV Considerers
Testing propositions in the wild through a marketing campaign
Interviewing customers about their current behaviours
Interviews are a perfect place to start when wanting to think about behaviour change as they allow us the chance to understand current behaviour. And interviews become stronger when done in the context of the behaviours you are wanting to learn about.
So to best understand current behavioural and situational barriers we interviewed 25 UK drivers split across 5 cohorts:
Recently ‘purchased’ an EV
Considering an EV in the next 6 months
Not considering an EV
Export energy to grid via Solar
Took part in a previous V2G trial
And where possible, we conducted these interviews at consumers’ homes. We believe there is no substitute for actually embedding ourselves into a culture and meeting real people in their context! Doing this allows us to capture rich, broad and nuanced insights about how and why people engage and behave with their vehicles in the way that they do. It provides us with a better appreciation of the cultural and environmental differences, and increases the validity of our findings as participants are better able to recall their behaviours when in the environment where the behaviour takes place.
Co-creating V2X solutions with customers and industry experts
Because the topic of V2X is a novel one that not many customers have had experience of, we conducted an innovative co-creation workshop. This was a participatory-action-research informed design the box exercise between industry representatives and EV Drivers, in order to ideate on potential solutions.
Design the box exercise is a great research method to help participants better express themselves and how they feel about future products. Looking at a design challenge from multiple perspectives is crucial in order to make better design decisions.
A co-design workshop was perfect for this project because it:
Compliments other methods
Leads to more innovative ideas
Focuses on idea generation rather than evaluation of current
Explores latent user needs
Brings the customer into process as a partner
Reduces feedback loop between knowledge > idea generation > idea evaluation
This workshop enabled us to explore customer perceptions and what would make V2X desirable. To achieve that we brought together 21 participants representing different groups:
EV Drivers
Automotive industry
Energy retailer industry
Charging manufacturer
Energy software
Surveying a large sample on their perceptions and attitudes towards V2X charging
Our interviews and co-creation workshop gave us great deep insight into current behaviours and perceptions. We were seeing that the barriers weren’t where we expected them to be. Rather than being with the V2X technology itself, the barriers for scale were present much earlier in the EV purchase journey.
And so we needed to layer on an additional method of research so that we could measure the scale of these barriers whilst also sizing up the potential market size for V2X.
A survey was the perfect approach here. There are multiple EV surveys being conducted right now but from what we could see none of them were asking questions specific to V2X. So our goal was to measure the scale of key traits important for high V2X value, and test the ideas we had for what a V2X proposition could look like based on our previous research.
We surveyed a nationally representative sample of EV Drivers and EV Considerers, 2,003 respondents in total. In summary we learnt:
73% of EV Drivers transition to EV for cost savings and 69% transition for environmental reasons
22% of EV Drivers don’t have a home chargepoint
64% of EV Drivers report no frustrations with their home charge set-up
43% of EV Drivers picked their home charger based on cost
62% of consumers expect to hear about, and be offered a home charger from the place where they purchase their car
1 in 5 consumers would take up a V2X prop
Testing conversion for V2X propositions in the wild
Some say three is the magic number, for us it’s four. We identified that from the three approaches detailed above we still had one aspect of consumer behaviour and attitude missing — what people would actually do when presented with the opportunity to sign up for V2X technology in real life.
So we ran a marketing experiment to test out two different V2X propositions, this helped us gauge the desirability and also test out the hypotheses we had coming from our other research methods. We created two separate marketing landing pages that described each proposition and marketed these pages on Google and Facebook for a seven day period between 24th – 30th March 2023.
The overall hypothesis that we wanted to test was that ‘We believe that EV Drivers will be interested in purchasing a V2X charger if the large upfront cost of the unit can be removed. We will know this is true when we see people signing up to our value prop landing pages to find out more’.
We distilled this down into 2 propositions and with the following hypotheses.
Value prop #1 | Bundle
We believe that prospective EV Drivers prioritise convenience when making the switch to an EV, and will accept the default package at the point of car purchase as they trust the car seller to know what a good set up is for them. We will know this is true when customers sign up to find out more about an all-in-1 EV bundle that includes a V2X charger.
Value prop #2 | Purchase
We believe that EV Drivers are blocked by getting a V2X charger because of the high upfront cost so if we provide a finance package that looks to split the V2X profits then EV Drivers will purchase V2X chargers. We will know this is true when customers sign up to find out more about this product.
We observed the following metrics for each proposition:
Bundle
4.36% Click through rate (impressions/ad clicks)
0.86% Conversion rate (unique visitors/sign ups)
Purchase
3.88% Click through rate (impressions/ad clicks)
4.16% Conversion rate (unique visitors/sign ups)
Across all industries, a conversion rate of between 2% – 5% is considered good.
Starting with the interview and workshop we were able to identify the themes that would prevent V2X adoption. And then we have been able to grow our confidence in those by layering on the survey and marketing experiment. We can conclude that these underpinning principles for V2X need to be true:
V2X value released upfront
V2X should be default option
We have spoken about the business model we developed in our recent webinar.
Bring consumers into the heart of proposition design
When designing new propositions that harness new technology and require customers to change their behaviours, we must first bring consumers to the heart of those discussions. To do so, we need to research with consumers through different methods that enable them to express their behaviours, perceptions and attitudes most appropriately.
