This is the story of how Faze1 learned how to acquire a 5kW residential solar customer in Massachusetts for $1,250 or $0.25/watt. This is about 50% lower than the $0.49/watt that is typically referred to for average residential customer acquisition cost in 2014.
Faze1 used three strategies to achieve this goal, which we will describe in detail in this interview: mapping technology, predictive analytics, and software automation. They used mapping technology to pre-screen all 1.2 million single family detached homes in Massachusetts in order to narrow their search to the most attractive 25% of all roofs. They narrowed down the 300,000 homes with the best roofs by using predictive analytics to identify the homeowners that most closely matched the demographic characteristics of the existing 6,000 solar customers in Massachusetts. Lastly, they used software to automate the entire process.
What’s More Amazing?
Now any solar company operating in Massachusetts can use Faze1 software to quickly and easily grade your own leads to identify the best leads.
Faze1’s SunVIEW is faster, cheaper, and better than using Google Maps to screen potential solar customers.
With Faze1, you’ll be able to instantly get site suitability information (roof size, tilt, azimuth, usable solar sales, shading) and important demographic information (FICO score, house size in square feet, occupancy and ownership, expected yearly electric use in kWh, utility territory and bill, years in home, and more) so you can identify customers that are both willing and able to purchase solar. Click here to download Faze1’s complete data dictionary to see what you can learn about each of your solar leads.
Finding the best customers with the leads that you’re already generating will lower you customer acquisition costs because you’ll spend less time on bad leads.
Faze 1 vs. Google Maps = Faze1 Wins, Hands Down
And What’s Super Amazing?
Because you’re a HeatSpring reader, we’re giving away 30 free trials to residential solar companies that are located in Massachusetts. Insert your information below to sign up. These will go fast.
Let’s Get into the Interview
This is an interview with the three members of the Faze1 team. Full disclosure: I’m a Faze1 advisor. The team members are Marc Guy, Elliot Goodwin, and Adam Hannah.
The interview tracks the story of Faze1 from the company’s beginning to where they are currently with SunVIEW. There are three significant stages to the history of the company that will be useful to anyone interested in product development and the solar industry and tell the story of an “okay” idea (sorry guys!) to an extremely valuable product.
Marc and Elliot had early experiences doing statistical analysis with the Massachusetts Clean Energy on Solarize campaigns that showed them lead generation and project size doesn’t necessarily equal profits. You can see 2012 Solarize data here.
How a used car salesman (yes, the stereotype is true) helped groSolar standardize and improve their sales process.
How the team applied proven mapping technologies that were already being used in the other established industries to screen the 1.2 million single family homes to find the most attractive homes.
Most solar companies focus on revenue instead of profits which mis-directs their marketing. They think they wanted more leads and site visits, but what they actually need is a more profitable way to process and screen their existing leads to find the most profitable ones.
3 Stages of Faze1 Product Development
Roughly speaking, Faze1 developed their Sunview product in three steps:
Stage 1. Faze1’s initial goal was to use data to find the best customers and in Massachusetts and sell the list to EPCs. They found 30,000 of the best solar leads in the state, based on the characteristics of the existing 6,000 solar customers in Massachusetts, and the goal was to sell these leads to companies. This didn’t work. Why? The value of these leads is directly proportional to the ability of a company to process them. This ability was very low.
Stage 2. The second step was create a direct mail campaign and market directly to those leads and sell site visits to EPCs. Faze1 was able to generate leads extremely effectively and found out that their site screening predictive model was effective. This allowed them to find customers very cheaply. They didn’t have the cash to sustain long direct mail campaigns, but they learned that their process and software worked very well.
Stage 3. Faze1 decided to sell access to their model through a software product that EPCs can use to quickly, easily, and cheaply identify the best leads from the leads that they’re already generating.