Nina Bhatia’s speech at Smart Homes Summit, 29 September 2015
Good morning, I'm Nina Bhatia, commercial director at British Gas and I'm delighted to be opening the summit today.
I was asked to give advice on making the connected home a reality in the UK for two reasons I believe.
Firstly, no one knows British Homes like British Gas. We've been behind the doors of homes here for more than 200 years. Each day, our 10,000 engineers visit 50,000 homes, so if anyone understands what makes UK consumers tick, and how UK homes work, it’s us.
Secondly, we’ve been bringing connected homes products and services to our customers for six years now. Initially with smart meters which for the first time put people in control of their electricity and gas use, and their bills, by doing away with estimated meter readings. We use the data we receive from smart meters to give our customers a personalised breakdown of energy use through an interactive online tool called ‘my energy’. This itemises energy use by day, week, month and year, and by appliances, heating and lighting, and gives tips on how to be more energy efficient and save money. The result is energy use and bills go from being something potentially confusing to something simple and transparent that people feel in control of.
We’ve also got our Hive connected thermostats, and a whole ecosystem of presence and motion sensors, lighting and smart plugs coming soon. In fact, we’re the UK’s market leader when it comes to connected homes, with well over 200,000 people using our award-winning Hive Active Heating to control their heating and hot water from wherever they are.
So I am honoured to open today, and I hope my perspectives will be useful
The connected home is not a slam dunk
What I’d say first, and this may not be music to your ears, is this: the connected home in the UK is not a slam dunk. Many in the room today have been working in the connected homes spaces for as long as, or longer than, British Gas. There’s a lot of chat, products, and hype, but how much of that has actually resulted in sales, and how close are we to mass adoption?
Earlier this year, a number of analysts predicted a slowdown in connected homes – before we’ve even begun – suggesting that consumers aren’t seeing value, devices are unreliable, people are confused, and that early adopters have already made their initial purchases and don’t need to spend more or have more just yet. This should come as a warning to us: we still haven’t cracked how to make connected homes applicable to a mass audience, despite all the building blocks being there – increased broadband penetration; decreasing hardware costs; and the proliferation of apps to control every aspect of our lives.
This is not going to be easy. We simply cannot underestimate the challenges of delivering the right hardware, software, and service to UK consumers to secure trust and buy-in.
It will be a journey we’ll take together, if we can address the following:
People don’t get ‘the connected home’
First, relevance - people don’t get ‘the connected home’. And why should they, when we insist on talking about the ‘internet of things’ and the shiny gadgets instead of the benefits to customers? This makes connected home technology sound like the preserve of the very geeky or very wealthy.
But nor do people get, or perhaps even need, ‘clever’ homes, or ‘considerate’ homes, or chivalrous homes that chat to you while they decide whether you want one sugar or two in your automated cup of tea.
What they do want is simple. People just want control. They want empowerment in a world with an increasing clockspeed and where they often feel helpless in relation to big line items in their home outgoings – like energy.
To explain how connected homes technology can give people better control of the basics we need to adopt real use cases. For instance, instead of ‘you should buy this white plastic box full of wires that will connect your appliances with your smart phone’, we need to have a conversation with potential customers, along the lines of: ‘have you ever worried you’ve left the iron on when you’re already half way to the train station? Now you can check and turn it off from an app on your phone.’ That is: 'there’s an easier way to help you with a real issue you’ve faced, and by the way that’s through what we call connected homes technology.'
Tech needs to be simple and just ‘work’
Secondly, the technology and user experience needs to be so simple and reliable that once people ‘get it’ they quickly don’t think about it as technology and can’t live without it. Connected homes products and services need to be as reliable as a light switch. They need to just work. If we’re asking people to replace a familiar brass lock and key with an app, people need to be really, really, sure it’s going to work and keep their homes and loved ones safe.
But if it goes wrong – and inevitably it does go wrong sometimes – you need the right kind of support to give people comfort and reassurance, fast. Thirdly, is affordability. With any product or service people have lived without for years, for mass adoption to occur the cost needs to be within reach for most of the population.
Be up front with data use
And finally, we need to acknowledge up front what we’re doing with data we collect. There are plenty of situations where customers are happy to share their data – for instance in the car industry insurers are offering lower premiums for safer drivers,–and drivers are happy to share this data because there’s something in it for them by way of lower prices. Any suggestion of a company doing anything inappropriate with data will put customers off both the company and the connected homes sector, so it’s damaging to us all. And woe betide you ever get hacked or perceived to have poor security.
Giving customers what they want
So what of that first challenge I mentioned: how do we ensure our connected homes products are relevant? To find out what resonates with customers, we can’t just ask them “what do you want from connected homes technology?” because people don’t always know what they want and it’s our job to invent it.
At British Gas, we thought they’d want to control their heating outside the home when we were creating Hive Active Heating – when they got unexpectedly held up at work for example, or social plans changed. But the reality is Hive customers use their phones to control their heating from the comfort of the couch –-or bed – just as much as they use it outside. While the way customers use Hive Active Heating was unexpected, we delivered what they craved most: control. Starting with making the physical thermostat digital, we’ve added more features along the way, responding to what our customers show us they need rather than telling them what they need. We’ve taken customers on that journey, not jumped ten light years ahead to a Jetsons lifestyle where your house controls you.
For instance with our geolocation feature: we purposefully introduced this as an optional feature with a prompt to make a change, not an automatic switch on – keeping the customer in control.
Finally on what customers want and taking them on a journey: they want simple, seamless technology. They don’t want to be confused with talk of platforms and technology that clashes. For the connected home to become a reality in the UK, we – the industry – need to work together and give people what they want: simplicity, control, and interoperability.
Hive Active Heating
I want to talk briefly about the experience of British Gas in this space.
In my introduction I mentioned that British Gas has been involved in the connected home for a few years now. It’s now more than two years since we launched Hive Active Heating. 58% planned to use the product every day last winter – just think about it – these were people who never touched their heating schedules from one season to the next. This technology really has transformed the way people manage their heating and hot water, and consequently how they feel about their energy bills. At long last, they are in control. Wherever they are.
In July this year we launched our beautiful new Hive thermostat in partnership with design entrepreneur Yves Behar. Not only is the form factor great, but it offers simpler ways to control the heating or hot water from the physical device, to give customers even more choice of how they retain control alongside the digital version.
At the same time, we launched an entire suite of Hive smart home products going beyond our heartland of heating and hot water: Hive Active Plugs which allow you to switch devices on and off from wherever you are; Hive Motion Sensors which enable you to detect motion in your home when you’re not there; Hive Window and Door Sensors which can notify you if you’ve left the back door open; and Hive Active Lights which let you control your lights from wherever you are. Customers tell me that they are comfortable with controlling their heating and hot water and now they want to know what else they can control.
It’s been important to us from the start that we own the whole experience, and that contributes to customer trust. Everything is delivered by our British Gas teams: from product development to creation, marketing, sales, installation and aftercare, with extremely active social media channels and real people on the end of the phone or in your home to help if things go wrong. And believe me, this reassurance and help is vital in such a new category.
Hive point of sale display
We’re also maximising partnerships to bring the products to life. For instance we’re working with retailers like John Lewis and Currys PC World, where customers go to look at products and understand the benefits. You can’t underestimate the impact of people being able to touch and feel things before buying.
The British Gas engineer
I also believe we’ve succeeded because we already had a trusted relationship with our customers, who have confidence our British Gas engineers know what they’re doing when they start tinkering with their wiring or boilers – even if your home is hundreds of years old. Because people know us, and trust us when it comes to helping them manage their homes, they trust us to bring them the next big thing: products and services that make it even easier to control their homes more smoothly.
My energy and geolocation
On this point of trust: our customers also trust us with their data. They have done for many years. We are using the data we collect for two purposes only: to improve the products and services we offer; and to add value to our customers, like letting them know if their home has reached its desired temperature and to prompt them to take action if they want to. We never sell a customer’s data to anyone and firmly believe our job is to put people in control of their homes, not use data to sell advertising. And we’re always working to strengthen our security and privacy measures to address new threats, customer concerns and demands
We’ve succeeded because we’re taking people on a journey with greater control as the prize at the end. We haven’t taken control away from people; or assumed that we (or a machine) knows best and can control a home better than a person. Maybe we’ll head down the path of automation in the future, but UK consumers are not ready for that sort of lifestyle just yet.
So in conclusion, what is my parting comment? I’d say this is a very exciting new category, but we have a lot of work to do if we are going to deliver products that are relevant and useful to solve real problems. But we need to back them with the service and reassurance that customers need, in UK homes that are far from standardised.
Notes to editors
Speech presented by Nina Bhatia at the Smart Homes Summit in London on the 29th September 2015.
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