Solar Cost of Acquisition: Here's why it's still Thousands of Dollars While other Costs Continue to Fall

Solar Cost of Acquisition: Here's why it's still Thousands of Dollars While other Costs Continue to Fall

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Report after report shows that the stickiest cost in the residential solar industry is cost of acquisition (COA). Ranging from $2,870 per customer in 2013 to $3,898+ per customer in 2019, this cost remains high even today. Why could that be?

It’s no surprise that this cost has failed to drop. When solar installers turn their homeowners’ systems on, they’re sent to third party monitoring platforms that don’t convey the solar installers brand, logo, or colors. The homeowner’s performance monitoring is not even hosted on the solar installer’s website. So how would they even remember who installed the system several years later?

I don’t know about you, but I have probably had 10-15 contractors work in my home on everything from my roof to my deck to my backyard, and I barely remember the names of them after a few years. The first project done at my home was a new roof, which was about 10 years ago. I can’t find their name anywhere in my records, and so I’m unable to give them ongoing maintenance work.

The easiest way to reduce the cost of acquisition is to turn your entire customer base into your marketing department. That’s how you can generate more referrals quickly. Referrals are by far the cheapest leads you can receive with the highest conversions to happy customers. While it may be easier to receive referrals in the first few months after a solar installation, there’s no guarantee that this will continue for years to come. This is especially true when your solar homeowners are looking at the name brand and logo of a third party monitoring platform, and receiving their monitoring updates with their brand instead of yours.

Sunvoy recognized this problem because Sunvoy was created by a solar installer (Ipsun Solar). Why were we sending all of our customers to third party monitoring platforms when our goal was to own the customer relationship from the day they sign a contract for solar through the 30-year life of the system? It makes no sense, unless you want to promote someone else’s brand.

Sunvoy is the only software in the solar industry that is built by a solar installer for other solar installers, and provides solar homeowners with access to their project status and performance from Day 1 to Day 4,380 (30 years). We believe that if you can put your brand in front of your customers every day then you’re going to generate more referrals. Whereas if you sell a solar system and your customers never see your logo again, how will they remember who did the work?

Fortunately, since Sunvoy is the only solar software created by a solar installer, we have data to back it up. Since our parent company (Ipsun Solar) started using Sunvoy, we have more than doubled our referrals in the past year. Doubling the number of referrals means cutting the cost of acquisition nearly in half, which increases margins and reduces the price point for solar, which advances our mission of fighting climate change. Doubling referrals year over year is how you become a referral-based solar business quickly. That’s not something you can do by relying on solar lead generation, or even the best solar marketing content in the industry.

Using Sunvoy has shown Ipsun Solar the power of becoming a referral based business, as opposed to relying on the traditional path of digital and radio advertising, lead generation sites, and pure luck of homeowners finding Ipsun Solar themselves.

What are some other ways to become a referral based solar installation company?

  1. Ask your existing customers for referrals by text after the system is installed, passes inspection, and is turned online. Use a local phone number so they recognize the area code.
  2. Have your sales representatives call their customers on their one year “Solarversary” to see how they’re enjoying their system.
  3. Try to use the same brand across all of your channels, including the identical color palette, so that your customers recognize your brand every time.
  4. Send monthly emails with your brand showing the performance of the system.
  5. Offer a bonus to customers who refer friends and family and go solar. Many installers offer at least $250 for a referral who ends up going solar.

Want to learn more about how you can give your solar customers a central point of contact with your company, including system status, performance, system documents, direct referrals, monitoring tickets, even a payment system? Book a demo with us today!

From "aha" to "oh crap", we’re sharing everything on our journey to install 1,000 kW in residential solar per month.

We’re learning a lot and so will you.

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written byHervé BillietCEOHerve is the Co-Founder and CEO of Ipsun Solar – a top residential solar installer in Washington DC with 60+ employees and $10M+ in annual revenue.
Hervé Billiet

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