Retailers looking to make the most of big data can learn from utility giant EDF Energy’s pioneering use of insight to create innovative services for its customers.

Speaking at the recent DataIQ Future Conference in London, John Hutchins, head of connected home at EDF Energy Blue Lab, said the utility sector is characterised by significant change, especially regarding the number of devices in the home that are now connecting to the network and providing information on energy use.

As part of EDF’s Blue Lab innovation accelerator, Hutchins and his team are exploring how the firm can create new, data-driven services. He explained to IT leaders at the conference how the Blue Lab incubator draws ideas from as many sources as possible, including internal line-of-business departments and external organisations, such as academic institutions and start-ups. Hutchins’ work around connected homes forms a key element of this approach.

Internet of Things devices

The utility firm continues to roll out connected devices, such as smart meters, across the country. These devices provide information about how customers use energy at home. More interestingly, Hutchins explained to Essential Retail after his presentation how he and his team are developing ways to use these data-driven insights to develop new services and better experiences for EDF customers.

“What we want to provide is a new element of personalisation that goes beyond simply replaying the information that customers have given to us,” he said. “We’ve used aggregated, third-party demographic data and statistical models to enrich our approach. Knowing where a customer lives and the environment they’re in, for example, can tell you a lot about an individual and the relevance of the offer you’re providing.”

The organisation is currently running a trial with 400 customers who have a Wi-Fi-connected smart meter that sends information back to EDF via the cloud. The connected team has built a platform to store this data and a mobile app, so customers can visualise the insights that are generated. 

Clever algorithms

The firm is using “clever algorithms” to develop new ways to highlight energy use during the day and to analyse the efficiency of key elements, such as boilers and insulation. Hutchins’ team continues to refine its approach and he offered best practice tips for retail IT decision makers, particularly regarding information use.

“What we’re doing is state-of-the-art and a lot of the services we’re creating need to be personal. That relies on the careful use of sensitive data. A lot of the algorithms we’re developing have been trained up, either with dummy data or friendly trial customers,” said Hutchins.

“Here, you need to have deep conversations with your customers about what you’re going to be doing and what you will be recording. Your customers need to be fully aware of what they’re doing and how they’re helping. As a business using data, you must work with people who give their consent. When the model’s right, it can be scaled up at a later stage.”

Hutchins said the smart use of data could have life-changing implications. He envisages an alert system where his firm can check which electric items are using too much energy and might be about to fail. EDF is already working with a start-up called Howz that uses sensors to monitor the activity of older people and to check for unexpected and potentially dangerous changes in routine.

“With smart meter data, we store information for operational reasons but – if we’re going to offer customers a suite of new services based on that data – we’re going to have get their consent. In this kind of innovative area, and with GDPR coming, we’re treading carefully and making sure we engage with legal departments and data officers to make sure that we’re meeting the right requirements as we go along,” said Hutchins, before offering further advice for retailers looking to develop new services from retained big data.

“You’re looking to develop something the customer will value – and you’re trying to squeeze the most value from the information they’re already providing your firm. You must take people on a journey before you can gain trust. If you show people their data use, and show how your organisation can help, you can start to generate more value.”