water utilities and society
DESCRIPTION
Overview presentation about the role of water utilities from a macromarketing perspectiveTRANSCRIPT
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Water Utilities & Society
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Water utilities & Society
What is a water utility?
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What is a water utility?
● Whole set of– Organization, processes,
activities, means and resources
● necessary for – Abstracting, treating,
distributing or supplying drinking water
– Collecting, treating and disposing of wastewater
– Providing the associated services
Water utilities in Monopoly board game.
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Coliban Water
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Water Utility Value Chain
Water Services Sanitation
Dis
trib
uti
on
R
etai
l
Ocean, rivers and groundwater (natural environment)
Raw Water
Dis
trib
utio
n
Customers
Drinking Water
Dis
trib
utio
n
Har
vest
Treatment Recycled Water
Dis
trib
utio
n
Treatment WasteWater
Nat
ural
Wat
er C
ycle
Col
lect
ion
Tre
atm
ent
Treatment
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Water Services
● Core– Water supply
– Sewerage services
● Enhancing● Billing & payment● Information provision
● Facilitating● Developer support● Complaint handling● Information provision
Core service for water utilities is the supply of safe drinking water
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Porter's Five Forces
● New entrants● Supplier power● Customer power● Substitute services
Porter, M. (1979). How competitive forces shape strategy. Harvard Business Review, 57(2).
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Water utilities & Society
Sustainability
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Environmental Sustainability
● Nature as an economic externality
● Ecosystem services● Water as
commodity● Tragedy of the
commons
Economics
Ecology
EquitableViable
Bea
rabl
e
Sustain-able
Society
Source: World Conservation Union
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Sustainability in water
“sustainable use of water requires the development and maintenance of a required flow of benefits to a particular group or place, undiminished over time without reducing benefits to other groups or ecosystems”
Gleick, Peter (1998), Water in Crisis: Paths to Sustainable Use, Ecological Applications 8 (3), 571–579.
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Climate Change
Source: CSIRO
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Victoria's Water Crisis
2000 to 2011 overall annual water consumption in Melbourne dropped by approximately 30 per cent.
Source: Office of Living Victoria
2000 to 2011 overall annual water consumption in Melbourne dropped by approximately 30 per cent.
Source: Office of Living Victoria
Dramatic reduction of reservoir inflows..
Source: Coliban Water
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The Utility Death Spiral
Source: freese.com
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Water: ᾿need᾽ or ᾽want᾽?
● Needs– State of felt deprivation
– Innate
● Wants– Shaped by society
– Learned
Source: timvandevall.com
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Beyond Needs & Wants
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Demarketing
● Lowering demand through marketing– Social marketing
– Price increase
– Restrictions
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Water utilities & Society
Social Corporate Responsibility
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Social Responsibility
The one and only obligation of business is to maximise is profits while engaging in open and free competition without deception or fraud”Milton Friedman, Capitalism and Freedom
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Affordability
● Financial hardship● Empathy● No total
disconnection
Vulnerable customers require protection.
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Public Health
● Walkerton Tragedy– E.coli contamination
from farm run-of
– 2500 people ill
– 7 deaths
p
Walkerton Tragedy: E.coli contamination from farm run-of. 2500 people ill. 7 deaths.
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Is water a public good?
Excludable Non-excludable
Rival Private Common-pool
Non-rival Club Public
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Water utilities & Society
Summary