The mechanics of increasing a mini-grid developer’s “penetration” per village begins in the initial phases, even before the site has been chosen.
During the site selection process, desktop research will be looking at secondary data such as population and settlement density, distance to the national distribution grid or other mini-grids or proximity to other sites for the purposes of clustering, to mention a few. Most of the primary data will be collected in the field, looking to cross-check/validate secondary data, identify suitable communication channels and assess general need/demand for a mini-grid.
As field personnel interacts with households and businesses, they must collect vital “lead” information: name, address, and phone number but also, through a series of well-thought-out surveys, the leads’ willingness and ability to connect and possibly purchase other products. Not only will the data be critical to assess the potential numbers of connections per village, but it will cover some of the necessary groundwork to follow up on the most promising leads.
Are you facing any of the following problems?
We all have fallen victim to a lack of clarity in a transaction — whether it’s not really understanding what we are paying for or, in the case of a subscription service, not remembering we had to pay or being surprised as we receive the bill.
We found the same to be true with many end-users in rural areas that purchase PAYGO deals or connect to mini-grids. While we should remain realistic about how great a mini-grid developer can improve the user experience of its customers, this isn’t always their focus. Yet, understanding its importance will ultimately allow for better repayments, and will also improve their reputation, resulting in word-of-mouth referrals and ultimately more connections. Here are a few examples of what can be done:
Automated SMS messaging: the simplest and must-have way to communicate with end-users to confirm a pending or processed payment or a reminder to pay. You can connect your CRM software to a bulk SMS provider like Africa’s Talking and automate the process based on MoMo payments received, balance due etc.
USSD menu: similar to automated SMS but with a better user experience and more possibilities to effectively communicate to end-users their balance, usage, future payments and more if needed. Many utility companies already use USSD with their customers however not all CRM providers have this feature in their system — due diligence will be required when choosing the CRM provider since this process must be connected to your standard sales activity and customer information.
End-user app: with the increasing penetration of smartphones in rural areas, there is a growing number of opportunities to considerably improve the user experience of mini-grid customers. A well-built end-user app allows mini-grid customers to effectively see their balance, payments due and next payment; share images of consumption, deliver promotions, educate, provide other services or products effectively and even put in place an incentive-based referral program.
Increasing the ARPU
All mini-grid developers will define success through their social impact as well as by looking at metrics such as Average Revenue Per User (ARPU).
The clear path to improved ARPU is to increase the utilization rate of end-users, which can be achieved by making the following strategic decisions:
1) Form partnerships with other companies selling electrical products: Through sharing of pertinent and specific customer information with partners, a mini-grid developer can considerably decrease the cost of acquisition of a distributor while ensuring that ultimately the mini-grid end-user has access to more products, increasing his or her clean energy consumption (hence ARPU) and ultimately living conditions.
2) Become a distributor of products/assets: A more ambitious approach would be for the mini-grid developer to directly distribute relevant products to its end customers. This approach needs to be analyzed carefully since it implies creating a completely new revenue stream + business model: building relationships with manufacturers, or wholesalers; training agents, following stock and ensuring after-sales support to mention a few. However, if properly set up, the reward is greater as not only would the developer increase consumption per connection but also add an additional revenue stream per user.
Clearly, mini-grid developers have a lot to manage, from finding the right site to setting up the mini-grid and running it while ensuring maximum return and impact. At Upya, we are here to help. We work with mini-grid developers to continuously improve their sales operations and customer relationships by providing them with a CRM that is integrated into metering devices, allows for the sale of any product, and automates communication to end-users.
From customer acquisition to customer support, Upya allows mini-grid developers to provide electrify-as-a-service to their customer base