A ban on incandescent light bulbs took effect in the European Union last month, making more efficient lighting technologies -- including compact fluorescent lightbulbs (CFLs) and light emitting diodes (LEDs) -- standard across Europe. Such a milestone reminds us that market shifts -- whether spurred by regulation or innovation -- open up new opportunities for businesses to sell greener products and services to consumers.
Many of these emerging opportunities focus on efficient home energy solutions for consumers. Here are two that businesses should consider:
The European Union isn't the only region phasing out traditional incandescent lightbulbs. In 2007, the United States passed a similar regulation (PDF) that effectively eliminates many of those bulbs by January of 2014. Initially, this mandate spurred demand for CFLs, likely from niche consumers willing to pay a higher price for an emerging technology that promised lower electrical usage and longer product life. But, since 2008, CFL purchases have declined each year, despite a precipitous drop in price.
Today, according to the U.S. Department of Energy, two thirds of the energy savings potential (PDF) from CFLs has yet to be realized. As such, with the U.S. pulling out of the recession and consumers more willing to open their wallets, businesses have an opportunity to spur demand for next-generation lighting products.
Retailers are showing renewed interest in efficient bulbs. Ace Hardware, for example, recently declared Oct. 18 to be Annual Light Bulb Day to raise national awareness for CFLs and other lighting technologies. It also offered discounts on purchases to motivate foot traffic and drive sales.
Alternatively, Ikea has chosen to bypass CFLs: It plans to stock LEDs exclusively by 2016 because it believes the rapidly evolving technology will likely outperform CFLs in the near future. By picking a winner in the lighting category, IKEA generated a lot of buzz for its stores and interest in this emerging technology.
Utilities and utility regulatory boards are also spurring demand as they comply with state energy-efficiency mandates. For example, Efficiency Vermont, an organization authorized and funded by the Vermont Public Service Board to promote energy efficiency, launched a successful campaign to increase the use of CFLs. The campaign tackled the perception that CFLs were more expensive by advertising 99-cent bulbs available at participating retailers. It also created a sense of urgency (“good while supplies last”) to drive demand. The campaign was so successful that it doubled the number of CFLs sold per month.
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