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Page 1: Builders vs. Buyers...Granite countertops ENERGY STAR® certification Water-efficient toilets High-efficiency heating and air conditioning system ENERGY STAR® certified appliances

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Builders vs. Buyers:What’s real, what’s imagined, and what’s the way forward?

SEBC • 8/2/19

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Need help effectively marketing your organization? Contact Shelton Group, the nation’s leading

marketing communications agency exclusively focused in the energy and environmental arena:

http://www.sheltongrp.com/; [email protected].

Thank you!

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

Page 3: Builders vs. Buyers...Granite countertops ENERGY STAR® certification Water-efficient toilets High-efficiency heating and air conditioning system ENERGY STAR® certified appliances

3 Gain a sustainable advantage

We create a market advantage for organizations that create a sustainable, energy-responsible future

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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The company we keep

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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We start here…

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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...and we end with marketing strategies and plans that build brands, shift perceptions and drive sales…

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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..and communications that build brands, shift perceptions and drive sales.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Today we will look at results from Professional Builder Magazine’s survey of builders

and compare those to Shelton Group’s national Energy Pulse® data,

which explored what consumers actually think and what they’re willing to pay for.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Let’s dig into what’s real, what’s imagined, and what your homes should feature and what your

stories should say so you can sell sustainable, beautiful homes.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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First, why does sustainability matter?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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82%

n=2,025

of Millennials are anxious about how climate change will affect their children’s

quality of life

Source: Millennial Pulse 2017© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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The average American recognizes that he or she needs to do something.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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of respondents think the average person should be taking concrete steps to reduce his/her environmental impact

85%

Q6 - Do you think the average person should be taking concrete steps to reduce his or her environmental impact? n=2,000

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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of Americans believe that we have a moral duty to leave the earth in as good or better shape than we found it

83%And

n=2,012Source: Eco Pulse 2018© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Would you like to be seen as someone who buys eco-friendly products?

2017

40%

2016

46%

37%

2015

38%

2014

33%

2013

37%

n=2,005© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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What major purchase best reflects our values, green or otherwise?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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So what does this all mean for consumers when they think about buying a home?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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18 Source: Energy Pulse 2018

89%of people who expect to buy a new home in the next two years say higher

energy efficiency would cause them to choose one new home over another

n=610© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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As part of Energy Pulse, we take a look at those who already own a “green home” as well as

those who are in the market for a new home andsay that energy efficiency would very/strongly

impact their new home purchase decision.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Let’s explore these two groups

Green Homebuyers

Already purchased a certified green home

Energy Savvies• In the market for a new home

• Say that energy efficiency would very/strongly impact their new

home purchase decision

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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More likely to live in the West

Green homebuyers ( ) and Energy Savvies ( ) look a lot alike…

Significantly more likely to currently live in an urban area Predominately Caucasian

(50%), but significantly more likely to be African-American vs. the overallPredominantly

Millennials and Significantly more likely to be 25-44

years old More likely to identify with the Democratic

political party

More likely to be well-educated, with a

graduate or professional degree

More likely to have kids in the Household

More likely to be male

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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More likely to live in the West

…with one significant difference: green home buyers are more likely to have a higher HHI.

More likely to have an annual income of $100,000 or more

Significantly more likely to currently live in an urban area Predominately Caucasian

(50%), but significantly more likely to be African-American vs. the overallPredominantly

Millennials and Significantly more likely to be 25-44

years old More likely to identify with the Democratic

political party

More likely to be well-educated, with a

graduate or professional degree

More likely to have kids in the Household

More likely to be male

More likely to have an annual

household income of between

$75,000-$99,999

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Similarly, while the two groups share attitudes about the environment in many areas…

Much more likely to say the government should pay more attention to environmental issues

More likely to say “The environmental impact of our energy use” is their biggest energy concern

Significantly more likely to say energy conservation is important in the way they make decisions and purchases

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Their top reason to participate in energy conservation activities or buy energy-efficient products or services was “to save money”

…money is more of a motivator for Energy Savvies, who haven’t yet bought a green home.

Much more likely to say the government should pay more attention to environmental issues

More likely to say “The environmental impact of our energy use” is their biggest energy concern

Significantly more likely to say energy conservation is important in the way they make decisions and purchases

Their top reason to participate in energy conservation activities or buy energy-efficient products or services was “to preserve the quality of life for future generations”and significantly less likely to say it was “to save money”

VS

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Today we’ll focus on the Energy Savvies, the

future homebuyers that align most with current

owners of Green homes. These future buyers

represents the ripest target for builders selling

green homes.

nationally representative sample of

100% of Americans

20%of Americans say they are planning to buy a home in the next 2 years

Just over half (55%) of those in the

market for a new home say that energy efficiency would very/strongly impact their new home purchase decision.

45% of those in the market for a new home don’t think about energy efficiency when purchasing

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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What do these home buyers want in a new home?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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27 n=223Q24 - Which of the following features do you want your new home to have?

23%

23%

23%

24%

24%

25%

26%

26%

27%

27%

27%

30%

31%

32%

32%

34%

A HEPA air puri fication system

All-LED fixtures/bulbs

Hardwood floors

A pool

A Wi-Fi enabled sound system with speakers throughout

An electric generator

Smart (connected to a mobile app) appliances

Solar panels

Water-efficient showerheads

A smart thermostat that learns my preferences and…

Granite countertops

ENERGY STAR® certi fication

Water-efficient toi lets

High-efficiency heating and air conditioning system

ENERGY STAR® certi fied appliances

Garage

1 of 2

Garages, granite countertops, sound systems and pools still make the top 15 list for features these buyers want…

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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28 n=223Q24 - Which of the following features do you want your new home to have?

23%

23%

23%

24%

24%

25%

26%

26%

27%

27%

27%

30%

31%

32%

32%

34%

A HEPA air puri fication system

All-LED fixtures/bulbs

Hardwood floors

A pool

A Wi-Fi enabled sound system with speakers throughout

An electric generator

Smart (connected to a mobile app) appliances

Solar panels

Water-efficient showerheads

A smart thermostat that learns my preferences and…

Granite countertops

ENERGY STAR® certi fication

Water-efficient toi lets

High-efficiency heating and air conditioning system

ENERGY STAR® certi fied appliances

Garage

1 of 2

… yet ENERGY STAR® appliances and certification, as well as efficient HVACs and toilets, make up the bulk of the top tier.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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29 n=223Q24 - Which of the following features do you want your new home to have?

23%

23%

23%

24%

24%

25%

26%

26%

27%

27%

27%

30%

31%

32%

32%

34%

A HEPA air puri fication system

All-LED fixtures/bulbs

Hardwood floors

A pool

A Wi-Fi enabled sound system with speakers throughout

An electric generator

Smart (connected to a mobile app) appliances

Solar panels

Water-efficient showerheads

A smart thermostat that learns my preferences and…

Granite countertops

ENERGY STAR® certi fication

Water-efficient toi lets

High-efficiency heating and air conditioning system

ENERGY STAR® certi fied appliances

Garage

1 of 2

… and smart thermostats and appliances, along with solar panels and generators, are wanted more than Wi-Fi speakers and pools.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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So what are the must-haves in a green home?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Builders have some strong opinions.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Higher efficiency (or SEER) HVAC, furnace, or air

conditioning equipment

Higher efficiency (ENERGY STAR®)

appliances

Higher R-value (or extra) insulation and superior air

sealing

91% 87% 84%

Q25 - What features do you consider to be must-haves in any home you call “sustainable?” (Consumer survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

Builders know that higher efficiency (or SEER) HVAC, higher efficiency appliances, and insulation with higher R-values matter a lot in a green home.

n=223n=55

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33 Q25 - What features do you consider to be must-haves in any home you call “sustainable?” (Consumer survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

And the list of features Builders consider “must-haves” is extensive...91%

87% 84% 82% 82% 80%73%

64%

Higher efficiency (or SEER)HVAC, furnace, or air

conditioning equipment

Higher efficiency (ENERGYSTAR®) appliances

Higher R-value (or extra)insulation and superior air

sealing

Low-E/High efficiencywindows

Water conserving featureslike low-flow showerheads,

toilets and/or rain watercollection systems

Longer lastingcomponents - building

materials and constructiondetails that increase the

useful life of the individualcomponents and the whole

house

Lower maintenancecomponents - e.g., buildingelements such as rock or

brick that require lessmaintenance

Constructed with materialsthat produce less off-

gasses or VOC's (indoor airpollution)

n=223n=55

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34 Q25 - What features do you consider to be must-haves in any home you call “sustainable?” (Consumer survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

The majority of Energy Savvies, however, don’t give these as much weight

91%87% 84% 82% 82% 80%

73%

64%

38%33%

25% 28%34% 31% 29%

23%

Higher efficiency (or SEER)HVAC, furnace, or air

conditioning equipment

Higher efficiency (ENERGYSTAR®) appliances

Higher R-value (or extra)insulation and superior air

sealing

Low-E/High efficiencywindows

Water conserving featureslike low-flow showerheads,

toilets and/or rain watercollection systems

Longer lastingcomponents - building

materials and constructiondetails that increase the

useful life of the individualcomponents and the whole

house

Lower maintenancecomponents - e.g., buildingelements such as rock or

brick that require lessmaintenance

Constructed with materialsthat produce less off-

gasses or VOC's (indoor airpollution)

#1 #2#3

n=223n=55

Energy Savvies

Builders

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35 Q25 - What features do you consider to be must-haves in any home you call “sustainable?” (Consumer survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

2 of 2

51% 49% 49%42%

36% 35%

13%

28%

20%27%

23% 23% 23%30%

24%

Air exchange/Filteringsyste ms to contribute tobett er indoor air quality

Includes recycledmaterials

Includes prod ucts mad ein an e nvironmentallyfriendly w ay - i .e ., ze ro

waste, recycle dmaterials , no harmfu l

chemicals , low e nergyusag e

Naturalland scaping /Xeriscaping- A natural ap proach to

land scaping usingindig enous p lants that

need less wate r,we eding, e tc. and tree s

for natural shad ing

Re newable electricpow er ge neration

syste ms such as so lar,geo thermal o r wind

Incorporat es skylights ,Natural lighting

A "green" cer tificationissue d by an

independ ent third party,such as EN ERGY STAR® ,LEED®, Indo or AirPLUS,Wate rSense®, EP A S ero

Energy Ready, et c.

So lar screens to blo cksunlight

56%

n=223n=55

Energy Savvies

Builders

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36

Why the disconnect? Energy Savvies don’t understand what truly makes a difference in this kind of construction.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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This confusion is also seen in their lack of confidence with terms and phrases.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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9%

19%

22%

28%

30%

Net-zero home

Sustainable home

High-performance home

Green home

Efficient home

Most Energy Savvies aren’t confident about what you mean when you use any of these terms.

Q4 - Please check any of the following terms or phrases that you know you could confidently and correctly explain to a friend. n=223© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Regardless of what you call it, they say they’re willing to pay more for the benefits of this kind of home.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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How much more?

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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41

Nearly half of Energy Savvies say they’ll pay 6%-10% or more

Q27 - How much more would you be willing to pay for a “sustainable home?” (Consumer survey)

4%

18%

28%

33%

14%

3%

22%

16%

25%24%

5%

7%

Nothing more 1-2% more 3-5% more 6-10% more Over 10% more Don’t know

Q12 - How much more do you think customers are willing to pay for a "sustainable" home? (Builder survey)

47%

n=223n=55

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42 Q27 - How much more would you be willing to pay for a “sustainable home?” (Consumer survey)

4%

18%

28%

33%

14%

3%

22%

16%

25%24%

5%

7%

Nothing more 1-2% more 3-5% more 6-10% more Over 10% more Don’t know

Q12 - How much more do you think customers are willing to pay for a "sustainable" home? (Builder survey)

Yet builders have much less faith in consumers’ willingness to pay more, with two thirds of builders estimating 3-5% or less.

63%

n=223n=55

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43

There’s also a disconnect between the specific features builders and Energy Savvies themselves believe consumers will pay for.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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44

Top three things Energy Savvies say they’ll pay more for

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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45

Top three things Energy Savvies say they’ll pay more for

Top three things builders say they’ll pay more for

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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46

Higher efficiency (or SEER) HVAC, furnace, or air

conditioning equipment

Higher efficiency (ENERGY STAR®)

appliances

Higher R-value (or extra) insulation and superior air

sealing

91% 87% 84%

Q25 - What features do you consider to be must-haves in any home you call “sustainable?” (Consumer survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

And remember these “Top 3” builder “must-haves”?

n=223n=55

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47Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

91%87%

84%

63%

70%

54%

Higher efficiency (ENERGY STAR®)appliances

Higher efficiency (or SEER) HVAC, furnace,or air conditioning equipment

Higher R-value (or extra) insulation andsuperior air sealing

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Q10 - In your opinion what sustainable features do you think homebuyers would be willing to pay more for? (Builder survey)

Bui

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Mus

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Builders recognize that consumers likely won’t pay on par with the “must” nature of these items…

n=55n=54

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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48Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

91%87%

84%

63%

70%

54%

46%

34%

24%

Higher efficiency (ENERGY STAR®)appliances

Higher efficiency (or SEER) HVAC, furnace,or air conditioning equipment

Higher R-value (or extra) insulation andsuperior air sealing

Bui

lder

Mus

t-ha

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Bui

lder

Mus

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Bui

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Mus

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Q26 - What sustainable features would you be willing to pay more for? (Consumer survey) Q10 - In your opinion what sustainable features do you think homebuyers would be willing to pay more for? (Builder survey)

Bui

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…but Energy Savvies are even less willing to pay more than builders think.

n=223n=55n=54© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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49

The disconnect in perception vs. reality makes clear the need to highlight the right things in marketing efforts.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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The disconnect also makes clear that it isn’t about individual features – it’s about a comprehensive package.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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51

What people want to hear about in a new home is a mix of luxury, smart and green.

© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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52

This is a new kind of conspicuous consumption.

Tesla Unveils Its New Line Of Camouflaged Solar Panels© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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53

Conspicuous consumption isn’t gone…

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54

…it’s just starting to look different.

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So do the right things to make homes truly sustainable …

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… and highlight what consumers can touch and feel.

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Fully commit and wrap your brand in a green blanket.

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“Consumers want to act green, but they expect businesses to lead the way.”

Source: https://ssir.org/articles/entry/cultivating_the_green_consumer© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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86%of Americans believe that companies

should take a stand for something beyond just making money

Q13 - Which of the following social issues do you expect companies to take a stance on? (Check all that apply.) n=1,000© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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89% of Energy Savvy prospective homebuyers

40%of Builders

Agree/Strongly Agree that more people will be interested in green homes.

Q28 (consumer) - To what extent do you agree or disagree with the following statement: “Within the next five years, more and more people will be interested in owning ‘sustainable homes’.” Q11 (builder) - To what extent do you agree or disagree with the following statement: "Among homebuyers in my market, I'm seeing more and more interest in 'sustainable' homes."

n=223n=55

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You need both to have a believable, comprehensive story folks will pay more for1. The features that say “green”2. The branding that says you’re committed to it

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As you communicate, connect emotionally

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“We are feeling machines that think, not thinking machines that sometimes feel.”

- Alex Batchelor

Connect emotionally

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64© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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The real, underlying benefits of green homes that they actually care about

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66 Gain a sustainable advantage.

Use messaging that communicates the benefits home buyers actually care about in the right way

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66%believe telling someone that an energy-efficient home

helps you avoid wasting money and natural resources is an effective way to get people to spend $1,500 on

efficient home features

n=2,009Source: Energy Pulse 2018

Frame “savings” messages about money as “loss avoidance”

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Health + Comfort© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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68%believe their house has a

moderate to strong impact on their health

n=2,009Source: Energy Pulse 2018© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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65%are at least somewhat concerned about

indoor air quality

n=2,009Source: Energy Pulse 2018© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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80%think energy efficient homes are healthier

homes

n=2,009Source: Energy Pulse 2018© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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60%believe telling someone that an energy efficient home is a healthier home is an

effective way to get people to spend $1500 on efficient home features

n=2,009Source: Energy Pulse 2018© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Comfort is also a key driver in the EE space

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Ranked 1st“making my home more comfortable” is ranked as the number one reason consumers give for

“spending money on my home”

n=2,009Source: Energy Pulse 2018 Gain a sustainable advantage© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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66%believe telling someone that an energy-efficient

home allows you to set your thermostat to a more comfortable level without increasing your bill is an

effective way to get people to spend $1,500 on efficient home features

n=2,009Source: Energy Pulse 2018 Gain a sustainable advantage© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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64%believe telling someone that an energy-efficient home is a more comfortable home, with fewer drafts and consistent

temperatures in all rooms is an effective way to get people to spend $1,500 on efficient home features

n=2,009Source: Energy Pulse 2018 Gain a sustainable advantage© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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And engage people in your story

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Pure information campaigns

simply don’t work.

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To recap• Americans are worried about the environment – and they increasingly want to

be seen doing something about it

• 55% of people in the market for a new home say energy efficiency matters. A lot.

• They want some of the same features that builders believe should be in a green home – but seeing and being seen is critical, so visible features take priority

• They’ll pay a little more for those features.

• But you have to communicate the benefits of those features in an emotionally engaging way.

• And you have to position your company as standing for sustainability.

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Questions

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Thank you!

Suzanne [email protected]

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Consumer-facing Data

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6%

9%

15%

17%

17%

19%

19%

20%

22%

22%

24%

27%

28%

28%

30%

30%

48%

None of the above

Net-zero home

Whole-house health protect ion system

High-performance comfort system

Dual-f lush toilet

Sustainable home

Connected home

Low carbon footprint

Green home

High-performance home

HVAC

Indoor air quality

Autonomous driving

Artificial intelligence (AI)

Efficient home

Facia l recognit ion

Smart home

“Green home,” “sustainable home” and “high-performance home” were terms that were all low on the list of terms that consumers understand, and only 9% of consumers say they could correctly explain the term “net-zero home” to a friend

n=223Q4 - Please check any of the following terms or phrases that you know you could confidently and correctly explain to a friend.

Energy Savvies

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33% of consumers would be willing to pay 6-10% more for a sustainable home

n=223Q27 - How much more would you be willing to pay for a “sustainable home?”

4%

18%

28%

33%

14%

3%

Nothing more 1-2% more 3-5% more 6-10% more Over 10% more Don’t know

Energy Savvies

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Consumer Demographics

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Consumer

n=2,009

No21%

Yes79%

Homeowner

Male49%

Female51%

Gender

West22%

Midwest22%

South37%

Northeast18%

Region

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Age range

n=2,009

Consumer

18%

16%

18%

17%

18%

13%

65 years or more

55-64 years

45-54 years

35-44 years

25-34 years

18-24 years

7%

16%

13%

64%

Other minorities

Hispanic or Latino

Black/African-American

White/Caucasian

Ethnicity

43%

29%

18%

10%

High school graduate or less

Some college or associate degree

Bachelor's degree

Graduate/professional degree

Education

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88

Occupation

n=2,009

Consumer

8%

7%

11%

16%

6%

8%

24%

20%

Unemployed

Part- time

Home maker

Re tired

Stud ent

Professional (e.g., doctor, lawyer, etc. –advanced degree required)

White collar (e.g., office worker, technician, etc. – at least some college required)

Blue collar (e.g., manual laborer, service or retail worker, etc. – no college degree

required)

2%

3%

11%

13%

23%

29%

19%

$2 00,000 or more

$150,000–$199,999

$100,000–$149,999

$75,000–$99,999

$50,000–$74,999

$25,000–$49,999

Less than $25,000

Income

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Professional Builder Data

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They seem to consider almost all of these features must-haves

n=55Q8 - For the rest of this survey, we will be using the term “sustainable.” For this study, we are defining a sustainable home as one that uses energy and material more effectively both in production and operation. Please check the features you consider to be must-haves in any home you call "sustainable?"

13%

35%

36%

42%

49%

49%

51%

56%

64%

73%

80%

82%

82%

84%

87%

91%

Solar screens to block sunlight

A "green" certification issued by an independent third par ty, such as ENERGY S TAR®, LEED®, IndoorAirPLUS, WaterSense®, EPA Z ero Energy Ready, etc.

Incorporates skylights/Natural lighting

Renewable electric power generation systems such as solar, geothermal or wind

Includes prod ucts made in an environmentally friendly way - i .e., zero waste, recycled materials, noharmful chemicals , low energy usage

Natural landscaping/Xeriscaping - A natural approach to landscaping using indigenous plants that needless water , weeding, etc. and trees for natural shading

Includes recycled mater ials

Air exchange/Filtering systems to contribute to better indoor air quality

Constructed with mater ials that produce less off-gasses or VOC's (indoor air pollution)

Lower maintenance components - e.g., Building elements such as rock or brick that require lessmaintenance

Longer lasting components - Building materials and construction d etails that increase the useful life ofthe individual components and the whole house

Water conserving features like low-flow shower heads, toilets and/or rain water collection sys tems

Low-E/High efficiency windows

Higher R -value (or extra) insulation and superior air sealing

Higher efficiency (ENERGY STAR®) appliances

Higher efficiency (or SEER) HVAC, furnace, or air conditioning equipment

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There are not many differences in what builders consider as must-haves and what they think homebuyers consider must-haves

n=55Q9 - Please check the features you think homebuyers want in a "sustainable" home? (Builder survey)Q8 - Please check the features you consider to be must-haves in any home you call "sustainable?“ (Builder survey)

18%

44%

33%

31%

33%

31%

25%

44%

42%

76%

78%

78%

64%

73%

82%

80%

13%

35%

36%

42%

49%

49%

51%

56%

64%

73%

80%

82%

82%

84%

87%

91%

So lar screens to blo ck sunlight

A "green" cer tification issue d by an indep endent third p ar ty, such as ENE RGY STAR® , LE ED®,Indoor AirP LUS , W aterSe nse®, EPA Sero Energ y Ready, etc.

Incorporat es skylights , Natural l ighting

Re newable electric po wer g eneration syst ems such as so lar , geo thermal or wind

Includes prod ucts mad e in an environmentally friendly way - i.e., zero waste , re cycled mater ials,no harmful che micals , low ene rgy usage

Natural land scap ing/ Xe riscap ing - A natural appro ach to landscaping using indigenous plants thatneed less wate r, w eeding, etc. and trees fo r natural shading

Includes recycled materials

Air exchange/Filtering syste ms to contribute to b etter indo or air quality

Constructed with materials that prod uce less off-gasses or VOC's (indoor air p ollution)

Lower maintenance components - e.g., build ing e leme nts such as ro ck or b rick that req uire lessmainte nance

Longer lasting compone nts - building mate rials and construction d etails that increase the usefullife o f the individual co mp onents and the whole house

Low-E/High efficiency window s

Wate r co nserving feature s like low-flow showe rheads , toilets and/o r rain water colle ction syst ems

Higher R -value (or e xtra) insulat ion and superior air sealing

Higher efficie ncy (ENERG Y S TAR®) app liances

Higher efficie ncy (or SE ER) HVAC, furnace, or air conditioning eq uipmen t

Q8

Q9

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92

40% of builders say they are currently seeing more interest in sustainable homes among homebuyers

15%

27%

18%

29%

11%

Strongly disagree Somewhat disagree Neither agree nor disagree Somewhat agree Strongly agree

Q11 - To what extent do you agree or disagree with the following statement: "Among homebuyers in my market, I'm seeing more and more interest in 'sustainable' homes." n=55© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.

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Builders do not have very much confidence in consumer familiarity with these terms

n=73

37%

17%

26%

7%

30%

38%

35%

30%

11%

25%

21%

32%

18%

15%

11%

22%

4%

6%

7%

10%

Net-zero energyhomes

High performancehomes

Sustainable homes

Green homes

Not at all familiar Slightly famil iar Somewhat familiar Moderately familiar Extremely famil iar

Q5 - How familiar do you believe current/potential home buyers are with the following terms: (Builder survey)

n=72

n=72

n=71

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Builders think buyers want higher efficiency appliances and higher efficiency heating and cooling equipment

n=55Q9 - Please check the features you think homebuyers want in a "sustainable" home?

7%

18%

25%

31%

31%

33%

33%

42%

44%

44%

64%

73%

76%

78%

78%

80%

82%

Other (please specify)

Solar screens to block sunlight

Includes recycled mater ials

Natural landscaping/Xeriscaping - A natural approach to landscaping using indigenous plants that needless water , weeding, etc. and trees for natural shading

Renewable electric power generation systems such as solar, geothermal or wind

Includes prod ucts made in an environmentally friendly way - i .e., zero waste, recycled materials, noharmful chemicals , low energy usage

Incorporates skylights/Natural lighting

Constructed with mater ials that produce less off-gasses or VOC's (indoor air pollution)

Air exchange/Filtering systems to contribute to better indoor air quality

A "green" certification issued by an independent third par ty, such as ENERGY S TAR®, LEED®, IndoorAirPLUS, WaterSense®, EPA Z ero Energy Ready, etc.

Water conserving features like low-flow shower heads, toilets and/or rain water collection sys tems

Higher R -value (or extra) insulation and superior air sealing

Lower maintenance components - e.g., Building elements such as rock or brick that require lessmaintenance

Longer lasting components - Building materials and construction d etails that increase the useful life ofthe individual components and the whole house

Low-E/High efficiency windows

Higher efficiency (or SEER) HVAC, furnace, or air conditioning equipment

Higher efficiency (ENERGY STAR®) appliances

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Builders believe that consumers would be willing to pay more for most of the sustainable home features

n=54Q10 - In your opinion what sustainable features do you think homebuyers would be willing to pay more for?

6%

13%

15%

15%

15%

17%

20%

24%

31%

33%

37%

52%

54%

54%

59%

63%

70%

Other (please specify)

Includes prod ucts made in an environmentally friendly way - i .e., zero waste, recycled materials, noharmful chemicals , low energy usage

Solar screens to block sunlight

Includes recycled mater ials

Natural landscaping/Xeriscaping - A natural approach to landscaping using indigenous plants that needless water , weeding, etc. and trees for natural shading

Constructed with mater ials that produce less off-gasses or VOC's (indoor air pollution)

Incorporates skylights/Natural lighting

A "green" certification issued by an independent third par ty, such as ENERGY S TAR®, LEED®, IndoorAirPLUS, WaterSense®, EPA Z ero Energy Ready, etc.

Water conserving features like low-flow shower heads, toilets and/or rain water collection sys tems

Renewable electric power generation systems such as solar, geothermal or wind

Air exchange/Filtering systems to contribute to better indoor air quality

Lower maintenance components - e.g., Building elements such as rock or brick that require lessmaintenance

Longer lasting components - Building materials and construction d etails that increase the useful life ofthe individual components and the whole house

Higher R -value (or extra) insulation and superior air sealing

Low-E/High efficiency windows

Higher efficiency (ENERGY STAR®) appliances

Higher efficiency (or SEER) HVAC, furnace, or air conditioning equipment

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22% of builders believe that consumers would not be willing to pay anything more for a home that is sustainable

n=55Q12 - How much more do you think customers are willing to pay for a "sustainable" home?

22%

16%

25%

24%

5%

7%

No more 1-2% more 3-5% more 6-10% more Over 10% more Don't know

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Builder Firmographics

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Builder

n=96

0%

3%

3%

4%

6%

8%

16%

21%

39%

Luxury product ion

Architect/designer engaged inhome building

Manufactured, modular, log homeor systems builder

Production first -time buyer

Multifamily builder

Other (please specify)

Production move-up/move-downbuyer

Diversified builder/remodeler

Custom home builder

Primary Business

4%

4%

13%

6%

3%

5%

6%

11%

46%

More than 1,000

250-1,000

101-250

51-100

26-50

16-25

11-15

6-10

1-5

n=93

Number of homes built in 2017

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Builder

n=95

7%

8%

9%

12%

13%

15%

16%

23%

28%

East South Central (AL, KY, MS, TN)

Pacific (AK, CA, HI, OR, WA)

West North Central (IA, KS, MN, MO, NE,ND, SD)

West South Central (AR, LA, OK, TX)

New England (CT, MA, ME, NH, RI, VT)

Mountain (AZ, CO, ID, MT, NV, NM, UT,WY)

Middle At lantic (NJ, NY, PA)

South Atlant ic (DE, DC, FL, GA, MD, NC,SC, VA, WV)

East North Central (IL, IN, MI, OH, WI)

Region

0%

22%

33%

44%

78%

Alaska

Hawaii

Oregon

Washington

California

State if in Pacific region

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Builder

n=54

26%

30%

30%

13%

2%

65 orolder

55 to 64

45 to 54

35 to 44

25 to 34

Age range of participant

53%

25%

17%

6%

0%

More than30 years

21 - 30years

11 - 20years

6 - 10years

Less than5 years

Length of time company has been

in business

n=53© 2019 Shelton Communication Group, Inc. ALL RIGHTS RESERVED.