Role of the Retail Electric Provider

Posted on January 16th, 2011 by

Energy deregulation is a fairly recent phenomenon in the U.S., with only a handful of states such as Texas, Georgia and Pennsylvania currently allowing consumers the ability to select their power service providers. Given that energy deregulation is still in its infancy, consumer confusion is inevitable — and especially within those jurisdictions where deregulation is new to consumer markets.

“How does deregulation work?”

“Will my new provider have to rip out my meter and wires, and put in a new set?”

“What happens if the power goes out?”

It is only natural that consumer questions abound when a market is newly deregulated. For instance, the state of Texas deregulated in 2002: but by early 2005, less than 15 percent of Texas consumers had elected to switch electricity providers.

Many people in newly deregulated markets incorrectly believe that switching providers is an onerous proposition. Nothing could be further from the truth. Switching energy providers is, by law, a process that is simple and easy.

But because energy is a life-essential service, consumers tread cautiously. Simply viewing a billboard or a 30-second TV commercial may not be enough to allay consumer anxiety. What is needed, particularly in the early years of a state’s deregulation, are customer-facing firms that care enough to take the time to visit with customers in their living rooms, explain the process and assure them they will receive dependable service at a fair price. In essence, the primary role of the retail electric provider in a deregulating landscape is to serve as a customer ombudsman and consumer advocate.

Enter network marketing as a consumer education program.

Several energy companies have realized that network marketing is an optimal way of reaching out to customers in their living rooms. By incentivizing entrepreneurs to explain energy deregulation to consumers within their social circle, network marketing efforts quickly gained momentum in the Texas marketplace. But the key to that momentum is the power of personal relationships.

Network marketers are not unfamiliar salespersons making front porch pitches concerning your energy supplier options. Rather, they are your brother or daughter or best friend — someone with whom you already have a trusting relationship — helping you better understand the nuances of energy deregulation so you can make an informed choice.

In the six years since the country’s longest tenured network marketer of retail energy entered the Texas consumer landscape, over 50 percent of consumers have switched to a new retail provider. The use of network marketing to promote the sale of energy is widely credited with being a primary catalyst of that switch rate, as the face-to-face marketing model helped educate the populace about the benefits of deregulation.

The success and proliferation of network marketing companies in the energy landscape illustrates the ongoing need among energy consumers for retail providers to be more than simply a logo on a bill; energy companies must act as advocates who help consumers get competitive energy rates balanced with quality service and while caring enough to build and sustain relationships with their customers.

Written by Rob Snyder, Stream Energy

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2 People have left comments on this post

» Nancy Zwally said: { Jan 17, 2011 - 01:01:25 }

Mr. Snyder should review the Income Disclosure which is on the Ignite website (the marketing arm of Stream Energy) which shows that 87% cannot make a living on this. My friend in PA paid a $300 fee, plus a monthly $25 website fee, to become an “independent associate” of Ignite. After almost two months, he has received a check for $197 (they also charge a $3 check processing fee no less). He received this money after signing up 2 people to use Stream Energy. Now they want him to concentrate on signing up other “associates” rather than selling energy because the sign up fees & website fees are where the money is for the higher ups in the company. Legally, I guess it’s not a pyramid scheme because he had to sell energy to 2 people, but after that they want the associates signing up more associates to get those fees. Plus they want you go to your family & family friends to join. We all know how that usually turns out. My friend refuses to see he will not make any money on this & is wasting his time.

Mr. Snyder recently said that 70% of the sales force “got their money back”. This is insulting to the people who attend the “rah rah” meetings they hold in the cities they are targeting. They do not tell the people they will just get their money back, they tell them they will make a lot of money from this. So much so that they can live the high life while others have to work. In a short time, all they will have to do is go to their mailbox & checks will start rolling in. They infer lavish vacations & all the time in the world the for family. They have these “shills” talk about all the money they made & tell the audience they can do the same. One particular shill called Randy (the Cowboy) from AK brags about how stupid he is & how stupid you can be too & the money will be rolling in anyway cause everyone uses energy (yup). How insulting, but the audience laughs instead of running for the hills.

Mr. Snyder should also be aware that one of his motivational speakers, Jennifer, certainly knows how to play the audience. She wrapped her arms around my friend to take a picture & even jokingly offered to put her tongue in his ear. Is this the type of professional woman he wants representing his company? She was obviously trained to target gullible men & flirt with them just to get the poor fools to sign up.

» Lyn Buckman said: { Jan 22, 2011 - 05:01:07 }

I paid my dues and got in and got the website and all that. I think its alright, you know uh. It all sounded pretty good. I like the idea of getting paid whenever folks pay their bills. Im thrilled to death to be a part of this I really am.
I like to help folks when I can. I feel like im on a good team. Im not real good at getting people to join up like that fella that got me too
I told him that I didnt think I would be real good at it, but he said that that didnt matter I could just do my best and in time I would get better if i didnt quit. that guy really helps me.
Heck he gave me one of his customers just to help me get my first check.. When I find somebody that wants to get in with me im gonna help them like he did me. I have just recently learned that energy deregulation is a really big deal. A whole bunch of people are gonna like this whenever they learn about that too. Its not like it use to be. There aint no other energy provider like Stream that I know of that is letting unordinary folk like me help em out gettin customers and stuff. I call old friends up and tell em that uh I want em to check sumpin out and when they ask me what it is I just tell em its a start up energy company cause thats what it is aint it?? I dont want to tell em over the phone cause if i do that they wont get to see my dvd and they sure aint gonna sign up if i mess up tellin em about it on the phone. I done tried that. I didnt think I was ever gonna sign nobody up but I finally did
and then i got somebody else to. and then I got one more. and before i knewit they were getting customers and i got a check again and another check, i like doing this cause if i dont want to i dont have to.. I run into somebody at the store I dont ask em to be my customer no more I just say hello how ya doin and they say fine how you doin and stuff like that and I just listen to em and they say something and then sometime during all that a subject will come up and I wind up finding a way to show em what I want em to see.. the next time i see them im either at their house or their at my house I like that dvd. they do too but they dont have no money so they cant join til they do so i just ask em to be a customer and when they get some money or whatever and want to join they can. And they can still be their own first customer when they get ready. I run into problems alot a times but i can always call that fella that put me in and he still helps.

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