- Residential
solar product sales have been forced to shift toward digital channels,
creating unexpected opportunity for cost savings
- Shift
to digital sales will allow the industry to lower customer acquisition
costs ahead of federal tax credits being phased out in 2022
- SING
subsidiary Direct Solar America is seeing increased virtual sales each
week, has expanded its presence to nine more states
Solar power and renewable energy sources have been lauded
for being at the forefront of cutting-edge technology, enabling consumers to
lower their costs while simultaneously reducing their carbon footprint.
However, and despite its high-tech focus, residential solar energy technology
has long been sold in a decidedly low-tech manner – through customer referrals
and face-to-face sales. Innovative companies like Direct Solar America, through
its parent company SinglePoint Inc. (OTCQB: SING), are creating ways to
capitalize on the market’s largely homebound status. The solar industry has
been sharply affected in recent weeks as prospective customers have shied away
from purchases due to store closures and shelter-at-home orders. However, the
forced transition to online sales may be a boon in disguise for the industry,
and solar product brokerages such as Direct Solar America stand to benefit the
most.
SinglePoint, a publicly traded company dedicated towards
acquiring businesses focused on emerging technologies, purchased solar power
broker Direct Solar America in May 2019 as it sought to capitalize on a boom in
residential solar installations, which increased by 45 percent in Q3 2019
relative to the same period in 2018 (http://ibn.fm/xdYV7). Direct Solar, which specializes in
assisting customers with solar product sales and arranging financing, has
enjoyed a remarkable growth spurt since the acquisition with sales and
operations now spanning 25 states.
The firm has also rapidly positioned itself as one of the
industry’s pioneers through the introduction of its virtual solar sales
platform. “The Direct Solar America management team did a great job
re-positioning the company quickly in these uncertain times […] ultimately we
believe this is an improvement in the process and will continue to drive the
company to new levels in the future,” SinglePoint CEO Greg Lambrecht stated in
a news release (http://ibn.fm/HIVId).
In an industry where previously “90 to 95 percent of closed sales had an
in-person meeting of some sort,” Direct Solar recently revealed that it is
seeing virtual solar customers increase each week through its online channels (http://ibn.fm/WUjTL).
The transition to online sales has been resisted by solar
companies based on the industry’s conventional wisdom that customers would
hesitate to commit to such costly purchases online. However, in 2016, Tesla
shifted the sale of its solar products to its online channels with energy
consultancy Wood Mackenzie suggesting that the move may have lowered Tesla’s
customer acquisition costs to “close to a quarter” per watt by the end of 2019.
That pricing was in sharp contrast to Vivint and Sunrun, the two largest solar
firms in the US, which had customer acquisition costs of $0.94 a watt and $0.90
a watt, respectively (http://ibn.fm/ng3CH).
With federal subsidies for residential solar purchases set to be phased out by
2022 (a tax credit of 26 percent is available to consumers this year), the
solar industry may be obliged to protect its margins by reducing their customer
acquisition expenses – estimated by WoodMac to account for 21 percent of total
costs (http://ibn.fm/GT839).
A recent survey published by EnergySage (http://ibn.fm/jDa7T) revealed
that 21 percent of prospective solar product buyers in 2019 were willing to
purchase their residential power systems online as compared to only 10 percent
in 2018. Notably, it was also the only sales channel that saw an increase in
preference. Direct Solar America has been able to rapidly scale its operations
(the firm has extended sales coverage to nine additional states in recent
weeks) following the introduction of its virtual sales platform as its agents
are now able to discuss solar options at any time and anywhere with clients –
helping the company to accelerate its growth rate. As SinglePoint President
Will Ralston summarized (http://ibn.fm/nI9DK),
“this whole situation and what it’s forced us to do will only position the
company to be more efficient and [have] lower costs.”
For more information, visit the company’s website at www.SinglePoint.com
NOTE TO INVESTORS: The latest news and updates
relating to SING are available in the company’s newsroom at http://ibn.fm/SING
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Editor@QualityStocks.com
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