How Direct Mail Propelled PECO Past the Competition
Grants provide a critical source of funding for utility providers. And with program funding typically allocated to only one utility, our client, PECO, turned to FARM for support.
PECO Energy Corporation, formerly Philadelphia Electric Company, serves more than 1.6 million electric and over 511,000 natural gas customers; it is the largest combination utility in Pennsylvania.
One of its universal service programs, the Low-Income Home Energy Assistance Program (LIHEAP), is a federally funded program designed to assist low-income residents with their heating bills during the winter months. Qualified customers can receive grants to pay their bills, which results in otherwise uncollected funds for PECO.
To secure this funding, PECO had to compete against Philadelphia Gas Works (PGW), whose budget was five times greater. Despite that challenge, PECO’s lofty goal was to increase the amount of funding received from $14 million to $20 million.
Our Recommendation
With a modest budget and the potential to target a very specific audience, FARM recommended a direct mail program that identified the residents most likely to qualify and apply for LIHEAP. We first analyzed program participants for similarities in demographics. This helped determine what information (age, gender, employment, etc.) suggested a customer would be most likely to qualify for—and respond to—the LIHEAP program application. A mailing list was then developed by selecting the top-ranking customers who also met the LIHEAP program qualification criteria.
We then developed our campaign creative and managed the production process seamlessly.
FARM also proposed simplifying the application process. In past years, an applicant had to call the LIHEAP office, request an application, fill it out, and then mail it back to LIHEAP. To increase the likelihood of completion, PECO mailed a partially populated application to qualified residents, who then finished the application and mailed it back in the provided envelope with postage. This cut the required steps in half.
Our efforts exceeded the client’s expectations and also crushed the competition. PECO received more than $25 million in funding for the program period and the direct mail program achieved a 4.25% response rate, more than twice the industry average.
If you have an offer and an untapped audience, reach out and see how FARM can help. And if there’s a competition involved, we’re always ready to step into the ring!
