Can a company that started advising and selling carbon-saving solutions to other companies establish itself as a high-profile consumer brand? That’s the question Mark Sait – founder of SaveMoneyCutCarbon – hopes to answer.
Founded in 2012 as a business-to-business venture, the company already sells energy-saving products directly to consumers, but Sait has ambitious plans to expand that side of its business and create an instantly recognizable brand. “We want to be the Deliveroo for this market,” he says. That’s why when we spoke last month, the company had begun plans to raise £28m to fund its growth.
But are energy-saving products the stuff brands are made of?
Well, the economic and geopolitical backdrop of 2022 has certainly focused UK consumers on the need to cut carbon. Jonathan Brearley, chief of the energy and gas industry regulator, appeared before a committee of MPs earlier this week and said the price cap on consumers’ energy bills would be raised by more than £800 to £2800 in October, as a result of a tenfold spike in gas prices. This follows a recent increase in the limit from £600 to £1900 last month. While the move – which effectively sets a maximum level for tariffs – will reflect the cost of oil and gas in global markets, it will leave a large number of people unable to pay for heating and other essentials.
So in that regard, cutting carbon is no longer just about mitigating a global climate catastrophe, it’s also about lowering the bills — arguably a necessity for surviving the winter months.
Capturing the imagination
Founded in 2012, SaveMoneyCutCarbon initially had a niche in helping businesses reduce their carbon costs and as Sait explains, its first port of call was the hotel and hospitality industry. “They had huge energy costs,” he said.
As Sait saw it, the market for CO2 reduction solutions was fragmented. SaveMoneyCutCarbon wanted to create a point of contact where companies can learn more about achievable savings.
Since then, the company has worked with some major clients on consultancy and implementation projects. For example, a refit of LED lighting in collaboration with brewer Greene King saved the customer £14,800 a year in a distribution center. Similarly, a Radisson Blu hotel in Manchester was helped to save £38,500 a year and cut emissions by around 60 per cent, including by replacing LEDs.
Over the past decade, the company has diversified into selling products to retail buyers and SMBs, while also introducing a retail channel aimed at reducing household costs.
Which brings us back to the heavily pressured consumers. Will energy-saving products capture their collective imagination?
These are certainly inconvenient times for household energy buyers. On the one hand, on the skin of the current energy cost crisis looms the much larger problem of climate change. Consumers know that they need to change their habits, but they are also aware that CO2 reduction measures can be expensive. In the longer term, the current gas boilers will have to be replaced by heat pump technology. Meanwhile, sales of gasoline-powered cars will be phased out, but as things stand, electric vehicles are a much more expensive alternative.
There is a danger that consumers will simply conclude that while energy is currently terribly expensive, any action to reduce CO2 emissions will lead to unaffordable upfront expenditures.
But Sait says there are more tasty options. Things that individuals can do relatively cheaply these days to save on their consumption. “Reducing your usage is the biggest savings you can ever make,” he says.
It’s a message that is especially relevant now that the cost per unit of energy is skyrocketing. “You can’t do anything about the price of energy, but you can reduce what you use,” he says.
The same principle applies to the business market. Navigating the net-zero agenda—as it applies to businesses—can seem complicated and technical. For example, a large company might think in terms of comprehensive carbon offsets. But Sait says the conversation has changed. “Around the time of COP26 I did a lot of interviews. I’ve been asked a lot about carbon offsets,” now I’m being asked about lowering the bills.
So on the face of it, CutCarbonSaveMoney is well positioned to raise and scale the required £28 million. But Said admits there are challenges. For starters, the company focuses on a number of very diverse markets. Corporates that already have advisors and ESG policies in place. SMEs that need guidance and support to understand the options open to them. And consumers who simply want to save on their bill. They all have different needs, pain points, and levels of knowledge. To serve these markets, the company has created virtual business units, each targeting a particular channel or customer base.
There has also been a questioning response from at least some potential investors who may prefer an exclusive focus on enterprises, B2B more broadly or consumers, rather than one company looking to cover all bases.
But Sait is convinced that the proposal is strong. Energy-saving products provide a measurable means of reducing carbon and lowering bills.
And when it comes to building a brand, there are precedents. Energy-saving devices may not be the sexiest product area in the world, but so is insurance, telecom or broadband and sites like Confused.com have become household names by enabling comparisons and savings.
And since energy costs show no signs of declining, there may never be a better time to interest buyers in the prosaic task of cutting consumption.