Photo courtesy of freefotouk's photostream
Remember Carbonetworks? This week, the carbon management firm underwent one of the most dramatic changes that any company can make: It ditched its name. Let’s explore a key market insight that this act of rebranding reveals.
Carbonetworks is now called ENXSuite, and according to its newly appointed CEO, Oracle veteran Beatriz Infante, dissecting the new brand better reflects her company’s core strengths — “EN” evokes energy, and “suite” implies an enterprise-class software and services platform. Clever, but let’s face it: That’s still a gamble for a company whose Performance Management Platform is deployed to over 8,000 facilities across the globe. After all, why toss away a perfectly good brand that not only got the company to its current visibility level, but is also pretty explicit in describing its particular business? But during a phone chat with Infante this week, it became apparent that the name change is more than a branding exercise; it’s a reaction to a market that, even at these early stages, is witnessing strong corporate demand for products that do more than just generate emissions data for their CSR reports.
During the call, Infante drew the contrast between the company’s early days in Canada and expansion into Europe, where carbon and greenhouse gas awareness is high and regulated in some markets, to operating in the United States, where there’s currently no cap-and-trade system in place. How do you compete in a market where environmental concerns may not rank as high? By targeting the growing market for tools and services that help corporations lower both emissions and costs. This dovetails nicely with an observation from E-Cubed Ventures’ Lee Bruno. In his GigaOM Pro report, “Sustainability Reporting Software: An Overview,” he writes:
There is a misperception that regulation is driving this market, but the fact is that, in most cases, regulation of resource consumption and greenhouse gases is still more a future possibility than a present reality. The primary driver is the substantial value to be reaped from greater operational efficiency. In other words: cost savings.
In this quest for improved operational efficiency, it’s not unusual to see “energy reduction budgets in the tens of millions of dollars,” says Infante. And firms that help corporations steer those expenditures toward cost-effective programs with a quick ROI may have a leg up over carbon disclosure pure-plays. For instance, ENXsuite’s SaaS platform, which she likens to “Hyperion for the energy space with a community component,” provides performance-based analytics on sustainability efforts and planning tools to guide cost- and emissions-cutting business policies and processes. (Hyperion, a provider of business intelligence and enterprise performance management software, was acquired by Oracle in 2008.) The “community” component she mentions is derived from ENXsuite’s customer base. Armed with data gleaned from its customers, businesses can quickly determine, for example, whether a switch to fluorescent lighting or server virtualization project has the biggest bang for the buck in the near term.
So, from a customer acquisition perspective, it was a smart move for ENXsuite to distance itself from its carbon-heavy former name. Anchoring the messaging to cost savings and operational efficiency resonates with corporations a whole lot better than a conspicuous focus on carbon emissions, particularly in regions where emissions are unregulated. Given the state of the wobbly economy, businesses are likelier to pursue cost-cutting opportunities rather than prepare for carbon regulation that may or may not materialize. That platforms like ENXsuite’s deliver environmental benefits is a bonus. Startups eyeing carbon management software and services, which will swell to a $4.3 billion market by 2017 (from $384 million in 2009), according to Pike Research, may want to follow ENXsuite’s lead and capitalize on this opportunity by speaking to the priority that every business shares in common: the bottom line.