BOSTON, MASS., Sept. 30, 2013 (GLOBE NEWSWIRE) -- U.S. solar installers should look to lowering customer acquisition costs in order to increase their bottom line. According to the latest report by GTM Research, U.S. Residential Solar PV Customer Acquisition: Strategies, Costs and Vendors, customer acquisition currently accounts for about 10% of overall residential solar costs but has the most near-term potential for cost reductions of any component of system costs.
At today's average cost and conversion rate, the solar industry would spend over $1 billion and require 3.9 million leads to achieve the forecasted 362,000 residential installations in 2016 alone. GTM Research expects the industry to save $619 million on customer acquisition costs between 2014 and 2017 relative to what would have been spent at today's cost of $0.49/W. To help companies lower customer acquisition costs, the report outlines the mergers and acquisitions shaping the market, strategies employed by leading installers, service and software vendors in the space, and opportunities for innovation.
FIGURE: Solar Customer Acquisition Service Providers
"In today's increasingly competitive market, the leading residential solar companies have already come to recognize the importance of finding and converting leads in a timely and cost-effective manner," said report author and GTM Research Analyst Nicole Litvak. "In just the last month, we've seen two acquisitions of originators specifically to reduce customer acquisition costs. This marks the beginning of what we expect to be an active market of mergers and acquisitions, strategy differentiation, and software innovation."
The report identifies trends in the landscape including the rise of comparison shopping platforms, the success of door-to-door sales models and channel partnerships, and the importance of referral programs. In addition, the report highlights the strategies of the leading residential installers such as SolarCity and Vivint Solar as well as service providers such as Sunrun and Clean Power Finance. Finally, the report offers suggestions for equipment suppliers on the role they can play in helping channel partners acquire customers.
FIGURE: Residential Solar Sources of Customers and Leads Required
"While much of the market's attention over the past two years has been focused on residential solar financing, an ecosystem of companies and strategies has been building in the customer acquisition space," said Shayle Kann, Vice President of Research at GTM. "We expect customer acquisition to be the next big area for innovation in residential solar, and a primary determinant of whether any given installer will remain successful."
The 45-page report includes analysis on over 80 installers, vendors, and channel partners in the residential solar installation market.
For more information on the U.S. Residential Solar PV Customer Acquisition report, please visit http://www.greentechmedia.com/research/report/us-residential-solar-pv-customer-acquisition
About GTM Research:
GTM Research, a division of Greentech Media, provides critical and timely market analysis in the form of research reports, data services, advisory services and strategic consulting. GTM Research's analysis underpins Greentech Media's webinars and live events. Our coverage spans the green energy industry including solar power, smart grid, energy storage, energy efficiency and wind power sectors.
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Source: Greentech Media