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Utilitiees Seggmen
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udy Cityy of Forrt Collins RESPONSSE TO RFP #76
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Prepared for City o
of Fort Collins 215 N
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oor Fort Collins, Coloraado 80522 Prepared by Research & Co
onsulting BBC R
1999
9 Broadway, Su
uite 2200 Denvver, Colorado 8
80202‐9750 303.3
321.2547 fax 303.399.0448
8 www
w.bbcresearch.com bbc@
@bbcresearch.com Table of Contents A. Executive Summary .................................................................................................................. 1 B. Contractor Information and Experience ............................................................................ 2 Figure 1. Organization of BBC Staff ............................................................................................... 3 Figure 2. BBC Project Commitments during Expected Study Timeline ......................................... 8 C. Scope of Services ..................................................................................................................... 10 Figure 3. Project Hours by Proposed Study Task ......................................................................... 14 D. Methods and Approach ........................................................................................................ 15 Figure 4. Study Timeline .............................................................................................................. 16 Figure 5. Sections in the Draft and Final Research Reports ........................................................ 20 E. Customer Engagement Strategy ........................................................................................ 21 F. Fees .............................................................................................................................................. 23 Figure 6. Proposed Fees by Project Task ..................................................................................... 23 Figure 7. Blended Hourly Billing Rate by Project Team Firm ....................................................... 23 G. Sustainability Philosophy and Approach ......................................................................... 23 H. Subconsultants ........................................................................................................................ 25 I. Additional Information ......................................................................................................... 25 BBC R ESEARCH & CONSULTING i SECTION A. Executive Summary BBCResearch&Consulting(BBC)ispleasedtosubmitthisproposaltoconductacomprehensive
multivariatesegmentationstudyofresidential,commercial,andindustrialcustomerswho
receiveelectric,water,wastewater,andstormwaterservicesfromtheCityofFortCollins
UtilitiesDepartment(FortCollinsUtilities).Thedepartmentwilluseinformationfromthestudy
togainabetterunderstandingofitscustomerbasesothatitcandevelopmoreeffectiveservice
deliverymodels;bettermeetcustomerneedsandexpectations;optimizeprogramsandservices;
andestablisheffectivegreenhousegasreductiontargets.
BBC Background and Qualifications BBCisa44‐year‐oldeconomic,finance,andmarketresearchfirmlocatedinDenver,Colorado.
Ourclientsincludestateandlocalgovernmentagencies;nonprofitorganizations;largenational
corporations;andsmallbusinesses.Almostallofthe16staffmembersthatweemployhave
graduatedegreesineconomics,finance,publicpolicy,behavioralscience,andotherrelated
fields.ThecombinationofseveralcharacteristicssetsBBCapartfromothermarketresearch
firmsandmakesusuniquelyqualifiedtoconductacustomersegmentationstudyforFortCollins
Utilities,includingourmarketresearchexpertise;ourexperienceconductingcustomer
segmentationstudies;ourexperienceworkingwithutilitiesandserviceproviders;our
customizedresearchapproach;andourresponsivenessandadaptability.BBCwillworkwith
twosubconsultants—DavisResearchandMWHGlobal(MWH)—whoalsopossessexpertisethat
isdirectlyrelevanttoconductingthecustomersegmentationstudysuccessfullyandefficiently.
Project Approach and Timeline BBCproposessixprojecttaskstoconductacomprehensivecustomersegmentationstudyfor
FortCollinsUtilitiesthatmeetsthehighestresearchstandards.Informationfromthestudywill
helpFortCollinsUtilitiesidentifykeysegmentsofitscustomers;bettermeetcustomerneeds
andexpectations;andoptimizeprogramsandservices.
Task 1 – Project initiation and management.BBCproposesclosecollaborationwithFort
CollinsUtilitiesthroughoutthestudythroughaseriesofregularmeetings,includingaproject
initiationmeetingandmanagementmeetingsthroughoutthecourseofthestudy.
Task 2 – Data review.BBCwillgainathoroughunderstandingofusageandotherdatathat
FortCollinsUtilitiesmaintainsonitscustomersthroughacomprehensivedatareview.Following
thereview,BBCwillrequestthatFortCollinsUtilitiesdeliverrelevantdatatotheprojectteamin
aformatthatwillallowustousetheminconjunctionwithinformationthatwecollectthrough
ourownprimaryresearchtodevelopdistinctsegmentsofFortCollinsUtilitiescustomers.
Task 3 – National trends analysis.BBCwillconductaliteraturereviewandananalysisof
nationaltrendsandfactorsthatmayaffectutilitiesusageanddemandamongFortCollins
BBC RESEARCH & CONSULTING PAGE 1 Utilitiescustomers.Inaddition,andtotheextentpossible,BBCwillexamineanynationaltrends
inthesegmentationofutilitiescustomersandhowthosetrendsrelatetoFortCollinsUtilities.
BBCwillsummarizefindingsfromtheanalysisinthedraftandfinalresearchreports.In
addition,informationfromtheanalysiswillinformthedesignofotherstudymaterials.
Task 4 – Residential customer segmentation.BBCwilldevelopdistinctsegmentsof
residentialcustomersandassessotherinformation—suchasfactorsthatmotivateutilitiesusage
andresponsestoutilities‐relatedissues—thatFortCollinsUtilitiesdesirestocollect.Todoso,
theprojectteamwillrelyondatathatFortCollinsUtilitiesmaintainsandondatafromalarge‐
scalesurveythattheprojectteamwillconductwithatleast2,000residentialcustomers.
Task 5 – Commercial and industrial customer segmentation.BBCwilldevelopdistinct
segmentsofcommercialandindustrialcustomersandassessotherinformationthatFortCollins
Utilitiesdesirestobetterunderstanditscustomers.Todoso,theprojectteamwillrelyondata
thatFortCollinsUtilitiesmaintainsandoninformationfrom40keypersonin‐depthinterviews
thattheprojectteamwillconductwithcommercialandindustrialorganizations.
Task 6 — Reporting and presentation.BBCwillconsiderthetotalityoftheresearchthat
weconductaspartofthecustomersegmentationstudytoprepareresearchreportsanda
correspondingpresentation.Thereportsandpresentationwillsummarizeresearchresultsand
methodologyandwillincludethoughtfulandactionablerecommendationsforFortCollins
Utilitiestouseinformationfromthestudytoachieveorganizationalgoals.
Timeline.BBCwillcompletethestudywithinthreemonthsofprojectinitiation.Weanticipate
thatwewillinitiatetheprojectinearlyOctober2014andsubmitthefinalresearchreportonor
beforeDecember31,2014.
Fees BBCproposestoconductthecustomersegmentationstudyforafirm‐fixedpriceof$147,000,
inclusiveofallprofessionalfeesanddirectcosts.
SECTION B. Contractor Information and Experience BBCisuniquelyqualifiedtoconductacomprehensivecustomersegmentationstudyforFort
CollinsUtilities.BBChasspecializedexpertiseinhelpingorganizationsunderstandwhotheir
customersareandhowtosegmenttheminmeaningfulways.Sinceourestablishmentin1970,
wehaveleveragedthatexpertisetoconductmarketandcustomerresearchforscoresof
differentorganizations.
1. Company Background BBCisa44‐year‐oldeconomic,finance,andmarketresearchfirmthatisownedbyseven
directorsandlocatedinDenver,Colorado.Since1970,thefirmhascompletedmorethan5,000
assignmentsallacrossthenationandabroad.Ourclientsincludestateandlocalgovernment
BBC RESEARCH & CONSULTING PAGE 2 agencies;nonprofitorganizations;largenationalcorporations;andsmallbusinesses.Almostall
ofthe16staffmembersthatweemployhavegraduatedegreesineconomics,finance,public
policy,behavioralscience,andotherrelatedfields.Figure1presentsourfirm’sorganizational
chart,whichillustratesourleadershipandstaffstructure.
Figure 1. Organization of BBC Staff BBC Directors
Ford Frick
Managing Director
Heidi Aggeler
Managing Director
Sameer Bawa
Director
Doug Jeavons
Managing Director
Adam Orens
Director
Todd Pickton
Managing Director
Kevin Williams
Director
BBC Staff
Jen Garner
Senior Consultant
Mollie Fitzpatrick
Associate
Allie Hausladen
Associate
Christy Pushchak
Research Associate
John McManus
Research Associate
Janna Raley
Research Associate
Leah Bluntschli
Research Associate
Shawna Lanham
Accounting Manager
Helene Luna
Project Assistant
Dr.SameerBawa,BBCDirector,willserveastheProjectManagerforthecustomersegmentation
studyandwillhaveprimaryresponsibilityfortheproject.Hewillalsoserveastheprimarypoint
ofcontact.Dr.Bawamaybereachedat:
BBCResearch&Consulting
1999Broadway,Suite2200
Denver,CO80202
telephone:303‐321‐2547
email:sbawa@bbcresearch.com
2. Project Personnel TheBBCprojectteamincludesthreeprojectteamfirmsthat,collectively,possessdecadesof
experienceconductingcustomersegmentationstudiesandworkingwithutilitiesandservice
providers—BBC(primeconsultant),DavisResearch,andMWH.BBCpresentsbriefresumesfor
keyprojectteampersonnelbelow.
BBC RESEARCH & CONSULTING PAGE 3 Sameer Bawa, BBC Director.Dr.BawawillserveastheProjectManagerandprimarypoint
ofcontactonthecustomersegmentationstudy.Hewillhaveprimaryresponsibilityforthis
contract.Dr.BawajoinedBBCin2008aftercompletinghisPh.D.inPsychologyattheUniversity
ofVirginia.Hisareasofexpertiseincludemarketresearch;surveydesign;in‐depthinterviews;
quantitativeandqualitativedataanalysis;andtechnicalwriting.Dr.Bawahasexpertisewith
variousstatisticaltoolstoensurethatdataareanalyzedaccuratelyandappropriately.Dr.Bawa
hasextensiveexperiencewithstatisticalsignificancetesting,crosstabulation,regression
modeling,clusteranalysis,factoranalysis,andmyriadotheranalyticaltools.Dr.Bawahastaught
11undergraduatecoursesattheUniversitiesofIllinoisandVirginia,primarilyrelatedtosurvey
researchmethods,dataanalysis,andtechnicalwriting.Hehasextensiveexperienceconducting
behavioralresearchandhaspublishedhisworkinseveralpeer‐reviewedjournals.
Dr.Bawahasbeeninvolvedwithmanymarketresearchprojectswithbothprivateandpublic
sectororganizations.Herecentlyledcustomersegmentationstudiesforseveralorganizations
includingtheDenverInternationalAirport(DIA),theRegionalTransportationDistrict–Denver
(RTD),andRackRoomShoes.Aspartofthoseprojects,Dr.BawaledBBC’seffortstocollect
surveyinformationfromthousandsofcustomers.Hethenusedsophisticatedstatisticaltools—
suchasfactoranalysisandclusteranalysis—todevelopdistinct,meaningfulcustomersegments
thateachorganizationusedtobetterunderstandthepeoplethattheyserveaswellaspeople
thattheycouldpotentiallyserveinthefuture.Heiscurrentlyleadinglarge‐scalemarketand
customerresearchprojectsfortheStateofIndiana,RackRoomShoes,OffBroadwayShoe
Warehouse,thePortofSeattle,andGralandCountryDaySchool.
Douglas Jeavons, BBC Managing Director. Mr.JeavonswillserveasAssistantProject
Manageronthecustomersegmentationstudy.Mr.JeavonsjoinedBBCin1992andleadsthe
firm’snaturalresourcepractice.Mr.JeavonsholdsaMaster’sdegreeinenvironmental
economicsandquantitativemethodsfromtheUniversityofColorado.Mr.Jeavonshasdirected
numerousstudiesfocusedontheattitudesandbehaviorsofutilitiescustomers,including
ongoingwaterdemandanalysesforvariouscustomersegmentsforAuroraWaterandtheCityof
Greeley.Mr.JeavonsalsorecentlycompletedaninnovativeassignmentforthePhoenixWater
ServicesDepartmentanalyzingtrendsinfluencingindustrial,commercial,andmultifamilywater
use.Thatassignmentinvolvedacombinationofdetailedstatisticalanalysisandinterviewswith
propertymanagers,equipmentsuppliers,andothersourcestobetterunderstandthefactors
drivingchangesinwaterusebyoffices,warehouses,retailestablishments,andothersubsectors.
Mr.JeavonshasalsodirectedseveralwaterdemandanalysesbycustomersegmentforDenver
Waterandhasservedasanexpertwitnessonwaterdemand‐relatedissuesincourtproceedings.
Mr.Jeavonsalsohasexperienceinanalyzingelectricutilitycustomersegments,primarily
focusingonlargercommercialandindustrialcategories.Inaddition,hehasdirectedutility
customersurveysfortheCityofFortWorth,DenverWater,andotherutilitiesproviders.In
2013,Mr.Jeavonsledastatewidestudyofpublicattitudesandperceptionsregardingwaterand
water‐relatedissuesfortheColoradoWaterConservationBoard(CWCB).Mr.Jeavonsispast
presidentoftheDenverAssociationofBusinessEconomistsandcurrentlyservesontheBoardof
DirectorsfortheConsolidatedMutualWaterCompanyinLakewood,Colorado.
Allie Hausladen, BBC Associate.Ms.HausladenjoinedBBCin2013aftercompletingher
Master’sdegreeinEnvironmentalandEnergyPolicyatStanfordUniversity.Ms.Hausladenhas
BBC RESEARCH & CONSULTING PAGE 4 beeninvolvedinmanysurveyandmarketresearchprojectsduringhertimeatBBC.Herareasof
expertiseincludemarketresearch;surveyanalysis;surveydesign;datamanagement;
quantitativeandqualitativeanalysis;andtechnicalwriting.PriortojoiningBBC,Ms.Hausladen
workedattheColoradoGovernor’sEnergyOfficeandindatabasemanagement.
Ms.Hausladenhasworkedonmanyprojectsinvolvingsurveydesignandexecution.Shewas
responsibleforreviewingsurveyinstrumentdesignandadministeringinterceptsurveysfora
marketresearchprojectwithRackRoomShoes.Shealsoplayedakeyroleincollectingand
analyzingdatafromasurveyforacustomersegmentationstudywithRTD.Ms.Hausladenalso
hasextensiveexperienceconductingcomplexdataanalysesonnumerousdiversitystudies.Ms.
HausladeniscurrentlyservingastheleaddataanalystonBBCsurveyprojectsforthePortof
SeattleandtheCaliforniaDepartmentofTransportation.
Ms.Hausladenalsohasextensiveexperienceperformingin‐depthstakeholderinterviewswith
localbusinessesandotherstakeholders.Forseveraldiversitystudies,Ms.Hausladenhasbeen
responsibleforconductingone‐totwo‐hourlonginterviewswithlocalbusinessesandtrade
organizationsaboutlocalmarketplaceconditions.Shealsohasexperienceidentifyingkey
themesandwritingclear,relevantsummaryreportsforthoseinterviews. Jason Kerns, Davis Research Project Management Director.Mr.Kernswillbetheonly
staffmemberfromDavisResearchwhowillserveaskeypersonnelonthecustomer
segmentationstudy.Mr.Kernsbringsmorethan15yearsofprojectmanagementandsurvey
researchexperiencetotheprojectteam.Hisareasofspecializationincludequantitativedata
collection;surveydesignandimplementation;multilingualtelephonesurveys;websurveys;and
qualitativeresearchdesignandimplementation.Mr.KernswillleadDavisResearch’seffortsin
programmingthecustomersegmentationsurveythattheprojectteamwillusetosegment
residentialutilitiescustomers.Mr.KernswillconsultcloselywithBBCandFortCollinsUtilities
toensurethatquestionformatsareconsistentwithprojectobjectivesandneeds.
Mr.Kernshasservedinamanagementroleonscoresofquantitativeresearchprojectsfor
numerousclientsinboththepublicandprivatesectors,includingonrecentBBCcustomer
segmentationstudiesforDIAandRTD.Hismajorresponsibilitiesincludemanagingquantitative
andqualitativeresearchprojects;briefingandtrainingsurveyorsonfinerdetailsofsurvey
administration;conductingqualityassuranceoverviewsforprogrammedsurveys;managing
fieldeffortsforin‐personsurveyingandinterceptprojects;andprocessingdataforselect
projects,includinganalysisandreporting. Jason Mumm, MWH Project Manager.Mr.Mummwillbetheonlystaffmemberfrom
MWHwhowillserveaskeypersonnelonthecustomersegmentationstudy.Mr.Mummisan
experiencedfinancialandmanagementconsultantwhofocuseshisservicesonfinancialand
economicissuesfacingwater,wastewater,electric,andgasutilitiesproviders.Hisexpertise
includesdevelopmentoffinancial,ratemaking,andpolicysolutionsforclientsthroughoutthe
UnitedStates.Hehasworkeddirectlywithcityanddistrictmanagers;financedirectors;utility
managers;andelectedofficialstodescribethefinancialimpactsofutilities’capitalandoperating
plans,includingtheimpactonratepayersandotherstakeholders.Hehascompletedmorethan
100economicstudiesforU.S.watersectorclients,andhasauthoredmorethan120published
BBC RESEARCH & CONSULTING PAGE 5 works.RelevantprojectexperienceincludesengagementsfortheCityofAurora,Colorado;the
CityofDenver,Colorado;andtheCityofSantaFe,NewMexico.
FortheCityofAurora,Mr.Mummismanaginga$2.6millionprojecttodeterminethelong‐term
planningandimplementationoftheagency’swatersupplies,treatment,anddelivery.Heis
leadingateamofmorethan50consultants—includingBBC—inengineering,science,permitting,
financial,andotherdisciplines.Heisresponsibleforthedeliveryofeveryaspectoftheproject.
3. Qualifications ThecombinationofseveralcharacteristicssetsBBCapartfromothermarketresearchfirmsand
makesusuniquelyqualifiedtoconductacustomersegmentationstudyforFortCollinsUtilities.
Market research. BBCiswidelyrecognizedforourabilitytocombinecomplexquantitative
analyseswithnuancedinformationfromqualitativeresearch.Ourphilosophyforeachresearch
assignmentistofullymeetourclients’needswhilemaintainingahighlevelofmethodological
rigor.MostofBBC’smarketresearchprojectsincludebothaqualitativeandquantitative
researchaspect,andwebringmarketresearchexpertise,independence,objectivity,and
creativitytoeachassignment.BBCpridesitselfindesigningandconductingmarketresearchthat
engagesparticipantstoshareintelligent,thoughtfulresponsesaboutanynumberofresearch
topics.Weareknownforthoroughlyanalyzingresearchresultsandprovidingresearchreports
thatincludethoughtfulinterpretationandrecommendations.BBCpossessesunparalleled
expertiseinsurveyresearch,focusgroups,in‐depthinterviews,andmyriadotherquantitative
andqualitativeresearchmethodsthataredirectlyrelevanttoconductingasuccessfulcustomer
segmentationstudyforFortCollinsUtilities.
Customer research and segmentation studies.BBChasconductedcustomerandmember
researchformyriadorganizationsallacrossthenation.Wehaveusedvarioustools—suchas
surveys,focusgroups,andin‐depthinterviews—toprovideourclientswithessential
informationtohelpthemunderstandwhotheircustomersare;whattheircustomer’s
perceptionsareoftheservicesandproductsthattheyprovide;and,ultimately,howtobetter
servetheircustomersinthefuture.Inmanycases,organizationshaveaskedBBCtoconduct
customersegmentationresearch.Aspartofthosestudies,BBCusessophisticatedstatistical
techniquestoidentifydistinctsegmentsofcustomers,members,orotherstakeholdersbasedon
theirattitudes,interests,behaviors,demographiccharacteristics,andvariousotherdimensions.
Informationfromsegmentationstudieshashelpedourclientsoptimizehowtheymarketto
differentsegmentsofcustomersandnon‐customers.Inaddition,ithashelpedourclients
maximizethevalueofvariouscustomergroupstotheirorganizations. Utility and service providers. BBChasextensiveexperienceworkingwithvariousutilities
andserviceprovidersthroughouttheUnitedStates.Muchofthatworkhasfocusedon
understandingcustomerperceptions;currentandfuturedemandsforutilityservices;and
resourceconservationopportunities.Forexample,formorethantwodecades,BBChas
evaluatedwaterdemandanddevelopeddemandprojectionsbycustomersegmentforDenver
Water.OurworkhasalsoincludednumerouscustomersurveystohelpDenverWatertarget
conservationeffortsandunderstandcustomerviewsregardingtheratestructureandlevelof
servicethatDenverWaterprovides.Wehavealsoundertakenseveralcustomersegmentation
BBC RESEARCH & CONSULTING PAGE 6 analysesforthePhoenixWaterServicesDepartment,mostrecentlyevaluatingvarious
subgroupsofindustrial,commercial,andinstitutionalcustomers.BBCrecentlycompleteda
surveyofAuroraWatercustomersandwillsoonundertakeasimilarsurveyfortheCityof
Bozeman,Montana.In2013,BBCconductedastatewidesurveyofColoradoresidentsregarding
attitudesandperceptionsaboutwater‐relatedissues.Othersimilarclientshaverecently
includedBoulderEnergySmart,theCityofFortWorth,theCityofGreeley,RTD,andTransfort.
Customized research approach. BBCunderstandsthatallofourclientshaveunique
researchneeds.Weprideourselvesinourabilitytocreatefully‐customizedresearchprograms
thatarespecificallytailoredtomeetthoseneeds.BBCdoesnothaveacookiecutterresearch
approachthatweusefromprojecttoproject.Instead,wecollaboratecloselywithourclients
fromthebeginningofeachprojecttofullyunderstandtheissuesthattheyarefacingandthe
informationthattheyrequire.Then,basedonthatunderstandingandonourexpertiseinmarket
research,webuildacustomizedresearchprogramthatprovidesthespecificinformationthat
willhelpourclientsmakekeydecisionsandmovetheirorganizationsforward.
Responsiveness and adaptability.BBCdoesnottreatresearchprojectsasastaticcollection
ofdiscretetasks.Weunderstandthatobjectivesmaychangeandunforeseenneedsmayarise
throughoutthecourseofaproject.Ourclientsappreciateourabilitytoactfastandprovide
solutionstotheiradhocrequests.Aspartofmostofourprojects,clientsmakenumerous
requestsbasedonnewinformation,organizationalchanges,andotherfactors.Weviewitasour
responsibilitytobeasresponsiveandadaptableaspossibleandmakesurethatwemeetallof
ourclients’needsevenifthoseneedsaredifferentfromwhentheprojectstarted.
4. Project Team Availability Keyprojectteampersonnelwillbefullyavailabletoconductthecustomersegmentationstudyin
amannerthatmeetsthehighestresearchstandards.BBCanticipatesthatthecustomer
segmentationstudywillrequireapproximately23percentofDr.Bawa’scapacity,12percentof
Mr.Jeavonscapacity,and25percentofMs.Hausladen’scapacityduringtheexpectedstudy
timeline(October1,2014–December31,2014).Figure2presentsBBC’sprojectcommitments
duringtheexpectedstudytimeline.Theprojectcommitmentsthatwehaveduringthattimewill
notinterferewithourabilitytoconductthecustomersegmentationstudy.
5. Similar Projects BBChasconductedmanyprojectsthatweresimilartothecustomersegmentationstudyforFort
CollinsUtilitiesintermsofobjectivesandscope.Thefollowingexampleshighlightour
experienceinconductingcustomersegmentationresearchandworkingwithutilitiesandservice
providers.
BBC RESEARCH & CONSULTING PAGE 7 Figure 2. BBC Project Commitments during Expected Study Timeline Project
Key BBC personnel involved
Aurora Water Demand Study
California Department of Transportation Diversity Study
Off Broadway Shoe Warehouse Customer Research
RTD Customer Satisfaction Study
State of Indiana Diversity Study
Rack Room Shoes Customer Research
Doug Jeavons
Allie Hausladen
Sameer Bawa; Allie Hausladen
Sameer Bawa
Sameer Bawa; Allie Hausladen
Sameer Bawa; Allie Hausladen
RTD Customer Segmentation Study.BBCandDavisResearchrecentlycompleteda
customersegmentationstudyforRTD.BBCconductedasurveywithmorethan2,000Denver
residentstocollectinformationabouttheirattitudestowardpublictransit;theirpublictransit
usage;andtheirpsychographic,demographic,andhouseholdcharacteristics.BBCusedfactor
analysisandclusteranalysistoidentifydistinctgroupsofRTDcustomersandnon‐customers
throughouttheDenverarea.RTDisusinginformationfromthestudytobetterunderstand
customersandnon‐customerssothatitcanmoreeffectivelytailorfuturecommunicationsand
serviceofferings.Dr.BawaledtheRTDCustomerSegmentationStudyandMs.Hausladenserved
astheleaddataanalyst.Mr.Kernsmanagedsurveyprogrammingandexecution.
ToaccessthefinalresearchreportfortheRTDCustomerSegmentationStudy,pleasevisit
www.bbcresearch.com/images/RTD_Market_Segmentation.pdf.
DIA Customer Segmentation and Concessions Study. BBCconductedinterceptsurveys
withmorethan4,000DIApassengerstoassesscustomercharacteristicsaswellasconcessions
desiresandbehaviors.Thesurveycollecteddetailedinformationabouttravelbehaviors,
concessionspreferences,andpassengercharacteristics.ItallowedBBCtosegmentconcessions
customersintodistinctsegmentsbasedonconcessions‐relatedbehaviors,travelpurposes,and
demographiccharacteristics.BBCwasresponsibleforconductingthesurveys,analyzingthe
data,andreportingtheresults.DIAisusingBBC’sresearchtoimproveitsconcessionsprogram.
Dr.BawaservedinamanagementroleontheDIACustomerSegmentationandConcessions
Study.Mr.Kernsmanagedsurveyprogramming.
Rack Room Shoes Customer Research.Since2012,BBChasprovidedRackRoomShoes
withquantitativeandqualitativeresearchservicestohelpthecompanytrackcustomerandnon‐
customerinsights.InformationfromtheresearchhashelpedRackRoomShoesmakedecisions
aboutitsbrand,products,andservice.Aspartoftheaccount,BBChasconductedsurveyswith
thousandsofcustomersandnon‐customersinkeyRackRoomShoesmarketstoexamine
customersatisfactionandinsightsinspecificgeographicmarkets;customerperceptionsabout
recentandpotentialstorechanges;demographiccharacteristics;andotherrelatedinformation.
BBCalsohasprovideddetailedsegmentationinformationaboutRackRoomShoescustomers
basedonshoppingbehaviors,attitudestowardshoeshopping,anddemographiccharacteristics.
BBCbegansimilareffortswithOffBroadwayShoeWarehousein2014.Dr.BawaleadstheRack
RoomShoesCustomerResearchandMs.Hausladenservesasadataanalyst.
BBC RESEARCH & CONSULTING PAGE 8 Aurora Water Demand Study.BBCandMWHarecurrentlyworkingtogethertodevelop
long‐termwaterdemandprojectionsthatAuroraWatercanusetodevelopanew,integrated
watermasterplan(IWMP).Aspartoftheproject,BBCisprojectingdemandbycustomerclass
andconductingotherwater‐demandrelatedanalyses.Theworkhasincludedvarious
econometricanalysesofhistoricaltrendsinwateruseandatelephonesurveyofmorethan800
residentsofAurora,Colorado.Mr.JeavonsisleadingtheAuroraWaterDemandStudyandMs.
Hausladenservedasadataanalyst.Mr.MummisintegratingBBC’sworkwiththatofother
consultantsaspartofdevelopingtheIWMP.
Phoenix Water Services Department Water Use Study.BBCisoneofseveralconsulting
firmscurrentlyundertakingamajorstudyofindustrial,commercial,andinstitutionalwateruse
forthePhoenixWaterServicesDepartment.BBC’srolehasincludedadetailedevaluationofthe
factorsthataredrivingchangesinwateruseamongretailestablishments,officeproperties,
warehouses,andmultifamilyresidences.Theworkhasincludedextensivestatisticalanalysisof
datafromthedepartment’sbillingdatabasecombinedwithassessordataregardingcommercial
propertiesandotherinformation.Theprojectteamhasalsoconductedin‐depthinterviewswith
propertymanagers,equipmentvendors,andothersources.Mr.JeavonsisleadingthePhoenix
WaterServicesDepartmentWaterUseStudyandMs.Hausladenisservingasadataanalyst.
CWCB Water Perceptions Study.In2013,BBCconductedamajorstatewidesurveyforthe
ColoradoWaterConservationBoard(CWCB)toexamineColoradoresidents’perceptions
regardingwaterandwater‐relatedissues.Nearly2,000residentsacrossColoradoparticipatedin
thesurvey,providingstatistically‐validresultsforeachofsixdifferentregionsthroughoutthe
state.Surveytopicsincludedrespondents’knowledgeofColoradowateruseandissues;
perceptionsofhouseholdwaterservicerelativetootherutilitiesandservices;assessmentsof
theperformanceofgovernmentagenciestaskedwithregulatingwateruseandquality;
perceptionsofwaterscarcity;greatestwater‐relatedconcerns;andmosttrustedsourcesfor
water‐relatedinformation.Mr.JeavonsledtheCWCBWaterPerceptionsStudy.
6. References BBCselectedthefollowingreferences,becauseofthesimilaritiesbetweentheservicesthatwe
providedtotheirorganizationsandthecustomersegmentationstudyforFortCollinsUtilities.
EachreferencecanattesttoBBC’sabilitytocompletethestudysuccessfully,efficiently,andina
mannerthatmeetsthehighestresearchstandards.
RTD. BBCrecentlycompletedacustomersegmentationstudyforRTD.Dr.Bawaledtheproject.
BBC’scontactatRTDis: DennisYaklich
SeniorMarketResearchAnalyst
(t)303‐299‐2110
(e)dennis.yaklich@rtd‐denver.com
BBC RESEARCH & CONSULTING PAGE 9 DIA.BBCrecentlyconductedacustomersegmentationandconcessionsstudyforDIA.Dr.Bawa
servedinamanagementroleontheproject.BBC’scontactatDIAis:
NeilMaxfield
ManagingDirector,BusinessDevelopment
CommercialDivision
(t)303.342.2574
(e)Neil.Maxfield@flydenver.com
Phoenix Water Services Department.BBCisconductingawatertrendsanddemand
analysisforthePhoenixWaterServicesDepartment.Dr.Jeavonsisleadingtheproject.BBC’s
contactatthePhoenixWaterServicesDepartmentis:
DouglasFrost
PrincipalPlanner
(t)602‐262‐4883
(e)douglas.frost@phoenix.gov
SECTION C. Scope of Services FortCollinsUtilitiesisinterestedincommissioningacomprehensivemultivariatesegmentation
studyofitsresidential,commercial,andindustrialcustomerswhoreceiveelectric,water,
wastewater,andstormwaterservices.Thedepartmentwilluseinformationfromthestudyto
gainabetterunderstandingofitscustomerbasetomeetthefollowingobjectives:

Developmoreeffectiveservicedeliverymodels;

Bettermeetcustomerneedsandexpectations;

Optimizeprogramsandservices;and

Establisheffectivegreenhousegasreductiontargets.
1. Narrative of Services TheBBCprojectteamwillleverageitsmarketresearchandcustomersegmentationexpertiseto
conductacomprehensivemultivariatecustomersegmentationstudyforFortCollinsUtilities.
Thestudywillincludebothquantitativeandqualitativeresearchtasksand,ataminimum,will
provideFortCollinsUtilitieswithinformationabout:

Nationaltrendsandfactorsthatmayaffectutilitiesusageanddemandamongresidential,
commercial,andindustrialcustomers;

Characteristics,attitudes,behaviors,andusagetrendsthatdefineresidential,commercial,
andindustrialcustomers;
BBC RESEARCH & CONSULTING PAGE 10 
Segmentsofresidential,commercial,andindustrialcustomersthathelpFortCollins
Utilitiesidentifydistinctclustersofitscustomerbase;

Factorsthatmotivateresidential,commercial,andindustrialcustomers’utilitiesusage;

Potentialprograms,offerings,andtoolsthatFortCollinsUtilitiescouldusetobetter
accommodatetheneedsanddesiresofresidential,commercial,andindustrialcustomers;

FactorsthatwouldhelpFortCollinsUtilitiesdetermineandidentifykeyresidential,
commercial,andindustrialaccounts;

Customerresponsestoutilities‐relatedpricing,programs,andenvironmentalissues,
includingrenewableenergy;

Communicationpreferencesofresidential,commercial,andindustrialcustomers;

Factorsandcriteriathatresidential,commercial,andindustrialcustomersusetomake
utilities‐relateddecisions;and

Benefitsthatresidential,commercial,andindustrialcustomersexpectfromutilities
providers,includingFortCollinsUtilities.
Afterconductingthestudy,BBCwillsummarizeresearchresults,keyfindings,and
recommendationsinawrittenresearchreportandanin‐personpresentation.
2. Project Management and Execution Dr.SameerBawawillhaveprimaryresponsibilityformanagingtheFortCollinsUtilities’
customersegmentationstudywithassistancefromMr.DouglasJeavonsandMs.AllieHausladen.
BBC’sprojectmanagementplanwillallowustoaccomplishallofthetasksthatwepresentinour
proposedmethodologysuccessfullyandinanefficient,timelymanner.KeyelementsofBBC’s
projectmanagementabilitiesinclude:

Provenmanagementapproachtomeetdeadlinesandachieveaccurateresearchresults;

ClosecollaborationandfrequentcommunicationbetweentheBBCprojectteamandthe
client,includingregulartelephoneandin‐personmeetings;

ClearprojectteamorganizationsothatsubconsultantsunderstandthatBBCwillleadall
projecttasksandwillbeaccountableforthequalityofalldeliverables;

CloseBBCoversightduringdatacollectionandotherprojecttasks,madepossiblebyour
commitmenttoproducinghigh‐qualityresearchresults;

Ampleopportunityforclientreviewatkeyjuncturesofthestudy,includingduringthe
reportwritingprocess(andatanyothertime,uponclientrequest);and

Expertisewithcustomersegmentationandothermarketresearchmethodology.
BBCwillleverageitsmanagementandresearchexpertisetoconductsegmentationanalysesof
FortCollinsUtilities’residential,commercial,andindustrialcustomers.Inaddition,BBCwill
analyzenationaltrendsandfactorsthatmayaffectutilitiesusageanddemandamongFort
CollinsUtilitiescustomers.
BBC RESEARCH & CONSULTING PAGE 11 Residential customers.BBCwilldevelopdistinctsegmentsofresidentialcustomersand
assessotherinformation—suchasfactorsthatmotivateutilitiesusageandresponsestoutilities‐
relatedissues—thatFortCollinsUtilitiesdesirestobetterunderstanditscustomers.Todoso,
theprojectteamwillrelyondatathatFortCollinsUtilitieswillprovideandondatafromalarge‐
scaletelephoneandonlinesurveythattheprojectteamwillconductwithresidentialcustomers.
Assumptions.BBC’smethodologyassumesthatFortCollinsUtilitiesmaintainsdatathatwecan
linktoindividualresidentialcustomersandhouseholds.Italsoassumesthatsurveyparticipants
willprovideunbiasedandaccurateinformationabouttheirownattitudes,perceptions,
behaviors,andcharacteristics.However,BBCisskilledatcreatingsurveyinstrumentsand
collectingdatainascientifically‐validmannerthatminimizesbiasandinaccuracy.
Limitations.Theanalysesforresidentialcustomerswillbelimitedbytheamountandtypesof
datathatFortCollinsUtilitiesmaintainsandcandelivertotheprojectteamandontheamount
ofinformationthatthestudyteamcancollectaspartofasurveythatisofreasonablelength.
Commercial and industrial customers.BBCwilldevelopdistinctsegmentsofcommercial
andindustrialcustomersandassessotherinformationthatFortCollinsUtilitiesdesirestobetter
understanditscustomers.Todoso,theprojectteamwillrelyondatathatFortCollinsUtilities
maintainsandoninformationfromkeypersonin‐depthinterviewsthattheprojectteamwill
conductwithrepresentativesfromcommercialandindustrialorganizations.
Assumptions.BBC’smethodologyassumesthatFortCollinsUtilitiesmaintainsdatathatwecan
linktoindividualcommercialandindustrialcustomers.Italsoassumesthatsurveyparticipants
willprovideunbiasedandaccurateinformationabouttheirownattitudes,perceptions,
behaviors,andcharacteristics.However,BBCisskilledatcreatingsurveyinstrumentsand
collectingdatainascientifically‐validmannerthatminimizesbiasandinaccuracy.
Limitations.Theanalysesforcommercialandindustrialcustomerswillbelimitedbytheamount
andtypesofdatathatFortCollinsUtilitiesmaintainsandcanprovidetotheprojectteamandon
theamountofinformationthatthestudyteamcancollectaspartofanin‐depthinterviewthatis
ofreasonablelength.Itwillalsobelimitedbytheprojectteam’sabilitytogetrepresentatives
fromcommercialandindustrialorganizationstoagreetoparticipateininterviews.Wewillwork
closelywithFortCollinsUtilitiestoencourageinterviewparticipation.
Trends in utilities usage and demand.BBCwillconductsecondaryresearch—includingan
extensiveliteraturereview—toexaminenationaltrendsandfactorsthatmayaffectutilities
usageanddemandamongresidential,commercial,andindustrialcustomers.Inaddition,andto
theextentpossible,BBCwillexamineanynationaltrendsinthesegmentationofutilities
customersandhowthosetrendsrelatetoFortCollinsUtilities.
Assumptions.BBCwillmakenosubstantialassumptionstoanalyzeusageanddemandtrends.
Limitations.BBC’sresearchofrelevantnationaltrendsandfactorswillbelimitedbythe
availabilityofexistingresearchandinformationonthetopic.
BBC RESEARCH & CONSULTING PAGE 12 3. Project Communication EffectivecommunicationandclosecollaborationbetweentheBBCprojectteamandFortCollins
Utilitiesisessentialtocompletingthecustomersegmentationstudysuccessfullyandefficiently.
BBC’sprojectapproachisdesignedsothattheprojectteamwillcollaboratecloselywithFort
CollinsUtilitiesthroughoutthecourseoftheentirestudy.

Theprojectteamwillparticipateinanin‐personprojectinitiationmeetingwithFortCollins
Utilitiestobeginthestudyandtodiscussanyprojectmanagementissues.

Theprojectteamwillparticipateinregularprojectmanagementmeetings—eithervia
telephoneorinperson—withFortCollinsUtilitiesatleasttwicepermonthtodiscussstudy
progress,preliminaryresults,andanyprojectchallenges.

BBCwillengageinaseriesofmeetingswithFortCollinsUtilitiestoreviewthedatathatthe
departmentmaintainsonresidential,commercial,andindustrialcustomers.

BBCwillsubmitdetailedmonthlyprogressreportsthatwillincludeinformationaboutthe
projectteam’sworkplanandmajorprojectmilestones.

TheprojectteamwillincludeFortCollinsUtilitiesintheprocessofreviewingand
approvingallstudymaterialsandprojectdeliverables.

TheprojectteamwillmeetinpersonwithFortCollinsUtilitiestodiscussandreviewthe
draftresearchreport.

TheprojectteamwillmeetinpersonwithFortCollinsUtilitiestodeliverthefinalreport
andtogiveafinalpresentation.
Dr.Bawa,BBCDirector,willleadtheprojectteam’scommunicationeffortswithFortCollins
Utilitiesduringthecourseoftheproject.
4. Project Size BBCproposesapproximately1,950hourstocompleteacomprehensive,multivariatecustomer
segmentationstudyforFortCollinsUtilities.1Figure3presentsthepercentagebreakdownof
projectteamhoursbyproposedstudytask.
5. Software and Analysis BBCwillusethefollowingsoftwareandanalyticaltoolstoconductacomprehensivecustomer
segmentationstudyforFortCollinsUtilities.
Microsoft Project. BBCwilluseMicrosoftProjecttoensurethatwemanagethestudyas
effectivelyaspossible,includingtrackingtheprojectteam’sprogressonstudytasks,
coordinatingthetimingofprojecttasks,andbudgetingprojectresources.
Microsoft Access.BBCwilluseMicrosoftAccesstocompileandreviewusageandotherdata
thatFortCollinsUtilitiesmaintainsonresidential,commercial,andindustrialcustomers.
1DavisResearchsurveystaffwillspendapproximately1,300ofthosehoursexecutingthetelephoneandonlinesurvey.
BBC RESEARCH & CONSULTING PAGE 13 Figure 3. Project Hours by Proposed Study Task Total project team hours
Project task
Task 1 ‐ Project initiation and management
Task 2 ‐ Data review
Task 3 ‐ National trends analysis
Task 4 ‐ Residential customer segmentation
Task 5 ‐ Commercial, industrial customer segmentation
Task 6 ‐ Reporting and presentation
Total
Percentage of total study hours
25
32
43
1,502
186
162
1%
2%
2%
77%
10%
8%
1,950
100%
STATA.BBCwilluseSTATAtoanalyzedatathatwecollectfromFortCollinsUtilitiesanddata
thatwecollectfromthelarge‐scalesurveyofresidentialcustomers.
CFMC Survent.DavisResearchwilluseCFMCSurventtoconducttelephonesurveyswith
customers.CFMCSurventisaComputer‐AssistedTelephoneInterview(CATI)system.
IBM SPSS Dimensions.DavisResearchwilluseIBMSPSSDimensionstoprogramandexecute
onlinesurveyswithresidentialcustomers.
6. Subconsultants TheBBCprojectteamincludestwoqualifiedsubconsultantsthatwillassistinconductingthe
customersegmentationstudysuccessfullyandefficiently.Bothfirms—MWHandDavis
Research—possessexpertisethatisdirectlyrelevanttothecustomersegmentationstudy.
Davis Research. DavisResearchisanexperiencedsurveyfieldworkfirmbasedinCalabasas,
California.BBCandDavisResearchhaveworkedtogetheronmanysurveyresearchprojects
since1998,includingrecentcustomersegmentationprojectswithDIAandRTD.Sinceits
inceptionin1970,DavisResearchhasgrowntobeoneoftheleadingsurveydatacollection
firmsinthenation.Thefirmconsistentlydeliversasophisticatedproductwithseamless
programmingandacustomizedlookandfeel.DavisResearch’ssuccesshascomefrom
partneringwithitsclientstodelivertailoredsolutionsthatbestanswerresearchquestions.The
firm’sclientsrangefromone‐personconsultanciestosomeoftheworld’slargestcorporations.
AllofDavisResearch’sclientscanattesttotheintimateattentionthatthefirmgiveseachofits
clientsandthehighqualitydatathatthefirmdelivers.Onthecustomersegmentationstudyfor
FortCollinsUtilities,DavisResearchwillberesponsibleforprogrammingandfieldingtelephone
andonlinesurveysrelatedtosegmentationeffortswithresidentialutilitiescustomers.
Forthecustomersegmentationstudy,DavisResearchwillberesponsibleforexecuting
telephoneandonlinesurveyswithresidentialcustomers.Thefirmwillberesponsiblefor
programmingthesurveyinbothformatsandworkingoutofitsofficesandcallcentertoconduct
surveyswithaminimumof2,000residentialcustomers.DavisResearchwillconduct
approximately41percentoftheworkassociatedwiththecustomersegmentationstudy.
BBC RESEARCH & CONSULTING PAGE 14 MWH. MWHGlobalbuildson200yearsofserviceimplementingpracticalsolutionsthatdeliver
substantialimprovementstomunicipalutilitiesproviders.MWHprovidesconsultingservicesto
utilitiesprovidersintheareasofassetmanagement,organizationaltransformation,technology
implementation,predictiveanalytics,strategicplanning,revenuestrategies,andmyriadother
areas.MWHhasalongandsuccessfulhistoryofprovidingconsultingservicestoutilities
providersthroughoutColorado,includinginFortCollins,Denver,andColoradoSprings.Thefirm
iscurrentlyworkingwithBBConawaterdemandstudyfortheCityofAurora.MWHalsoworks
withvariouslocalandregionalgovernmentsandprivatesectorclientsallacrossthenation.
Forthecustomersegmentationstudy,MWHwillserveinanadvisoryrole.Thefirmwillassist
BBCwithvariousstudytasks,includinganinitialdatareview;ananalysisofnationaltrends;
reviewingresearchmaterials;andreviewingthedraftandfinalresearchreports.MWHwill
conductapproximately5percentoftheworkassociatedwiththecustomersegmentationstudy.
7. Timeline BBCwillcompleteacomprehensivecustomersegmentationstudyforFortCollinsUtilities
withinthreemonthsofcontractexecution.Figure4presentsavisualrepresentationofthe
proposedtimelineforthestudy,whichincludesthefollowingkeymilestones:

BBCwillinitiatetheprojectinearlyOctober2014.

BBCwillreviewFortCollinsUtilitiesdataoveratwo‐weekperiodinOctober.

BBCwillanalyzenationaltrendsinutilitiesoverathree‐weekperiodinOctober.

BBCwillbegintheresidentialcustomersegmentation—includingalarge‐scalesurvey
effort—inearlyOctober2014andwillcompleteitattheendofNovember2014.

BBCwillbeginthecommercialandindustrialcustomersegmentation—includingan
intervieweffort—inearlyOctober2014andwillcompleteitattheendofNovember2014.

BBCwillbeginwritingtheresearchreportinearlyNovember2014.Wewilldeliveradraft
reportinDecember2014andafinalreportattheendofDecember2014.

BBCwillgiveafinalin‐personresearchpresentationattheendofDecember2014.
BBCwillworkwithFortCollinsUtilitiestofinalizethestudytimelineatprojectinitiation.
SECTION D. Methods and Approach 1. Project Approach BBCproposessixprojecttaskstoconductacomprehensivecustomersegmentationstudyfor
FortCollinsUtilitiesthatmeetsthehighestresearchstandards.Thestudywillprovidea
multivariatesegmentationofFortCollinsUtilities’residential,commercial,andindustrial
customerswhoreceiveelectric,water,wastewater,andstormwaterservices.Thatinformation
BBC RESEARCH & CONSULTING PAGE 15 willhelpFortCollinsUtilitiesidentifykeysegmentsofitscustomers;bettermeetcustomer
needsandexpectations;andoptimizeprogramsandservices.
Figure 4. Study Timeline 2014
October
Project Task
Task 1 ‐ Project initiation and management November
December


Project initiation meeting
Task 2 ‐ Data review
Final presentaton
Task 3 ‐ National trends analysis
Task 4 ‐ Residential customer segmentation

S urvey development
Utilities review
S urvey execution
S urvey analys is
Task 5 ‐ Commercial, industrial customer segmentation
E xis ting data analys is
Interview guide development

Utilities review
Final report Interview execution
Interview analys is
Task 6 ‐ Reporting and presentation
Note: Draft report

 = Deliverable;  = In‐person meeting Task 1 – Project initiation and management.Effectivecommunicationandresponsive
projectmanagementareessentialtocompletingthecustomersegmentationstudysuccessfully
andefficiently.BBCproposesclosecollaborationwithFortCollinsUtilitiesthroughoutthestudy
throughaseriesofin‐personandtelephonemeetings.
Project initiation meeting.BasedondirectionfromFortCollinsUtilities,theBBCprojectteam
willcoordinateandparticipateinanin‐personprojectinitiationmeetingtobeginthestudy.
Duringthemeeting,BBCwill:

Establisheffectiveandresponsivechannelsofcommunication;

ReviewpreviousresearchthatFortCollinsUtilitieshasconducted,includinginformation
aboutanyknownsegments;

Discussandrefinesegmentationobjectivesandmethodology;

DiscussdatathatFortCollinsUtilitiesmaintainsonresidential,commercial,andindustrial
customers;and

Addressotherstudytopics.
Management meetings.BBCwillparticipateinregularprojectmanagementmeetingswithFort
CollinsUtilitiesthroughoutthecourseofthestudy,eitherinpersonorviatelephone.BBCalso
BBC RESEARCH & CONSULTING PAGE 16 
recommendsholdingadditionalin‐personmanagementmeetingsatkeyjuncturesofthestudy,
includingwhentheprojectteamsubmitsdraftandfinalresearchreports.
Task 2 – Data review.Aspartoftheprojectinitiationmeetingandsubsequenttelephone
meetings,BBCwillgainathoroughunderstandingofusageandotherdatathatFortCollins
Utilitiesmaintainsonitsresidential,commercial,andindustrialcustomers.Followingthedata
review,BBCwillsubmitawrittendatarequestthatwillspecifythedatathatwillbehelpfulto
theprojectteam.BBCwillexpectFortCollinsUtilitiestodeliverrelevantdatatotheprojectteam
inaformatthatwillallowustousetheminconjunctionwithinformationthatwecollectthrough
ourownprimaryresearchtodevelopdistinctsegmentsofFortCollinsUtilitiescustomers.
Task 3 – National trends analysis.BBCwillworkcloselywithMWHtoconductaliterature
reviewandananalysisofnationaltrendsandfactors—suchashealthcarereform,current
economicconditions,andconcernsaboutclimatechange—thatmayaffectutilitiesusageand
demandamongresidential,commercial,andindustrialcustomers.Inaddition,andtotheextent
possible,BBCwillexamineanynationaltrendsinthesegmentationofutilitiescustomersand
howthosetrendsrelatetoFortCollinsUtilities.BBCwillrelyonseveralinformationsourcesfor
itsreviewandanalysisincludingacademicjournalarticles,industrywhitepapers,other
consultants’research,andotherrelevantpublications.BBCwillsummarizefindingsfromthe
nationaltrendsanalysisinthedraftandfinalresearchreports.Inaddition,informationfromthe
analysiswillinformthedesignofthesurveyinstrumentandin‐depthinterviewguide.
Task 4 – Residential customer segmentation.BBCwilldevelopdistinctsegmentsof
residentialcustomersandassessotherinformation—suchasfactorsthatmotivateutilitiesusage
andresponsestoutilities‐relatedissues—thatFortCollinsUtilitiesdesirestobetterunderstand
itscustomers.Todoso,theprojectteamwillrelyonusageandotherdatathatFortCollins
Utilitiesmaintainsandondatafromalarge‐scaletelephoneandonlinesurveythattheproject
teamwillconductwithresidentialcustomers.
Survey development.TheBBCprojectteamwilldevelopasurveyinstrumentthatcollects
informationtoaccuratelyandmeaningfullysegmentresidentialcustomers.Surveydevelopment
willbebasedoninformationfromtheprojectinitiationmeeting;conversationswithFortCollins
Utilities;andourexpertiseinconductingsurveyresearchandsegmentationstudiesforvarious
organizations.Thesurveywillcollectinformationaboutvarioustopicsrelatedtoutilitiesand
customercharacteristics,including:

Utilities‐relatedattitudes,behaviors,andusage;

Utilities‐relatedprograms,offerings,andtools;

Utilitiesrelatedpricing,billing,andotherissues;

Factorsthatmotivateutilitiesusage;

Factorsthatinfluencedecisionsaboututilities;

Expectationsofutilitiesproviders;

Communicationpreferences;and

Demographicandhouseholdcharacteristics.
BBC RESEARCH & CONSULTING PAGE 17 BBCanticipatesthatthesurveywilltakeapproximately12minutestocompleteviatelephone
(approximately10minutesviaInternet).Wewillsubmitfulldraftsofthesurveyinstrumentto
FortCollinsUtilitiesforreviewandapproval.Afterrespondingtothedepartment’scomments,
BBCwillfinalizethesurveyinstrumentandsendittoDavisResearchforprogramming.
Survey execution.Oncethesurveyinstrumentisapprovedandprogrammed,BBCwillwork
withDavisResearchtoconductthesurveysviatelephoneandInternet.Basedonbillingdatathat
FortCollinsUtilitieswilldelivertotheprojectteam,DavisResearchwilluseaddress‐based
samplingandrandom‐digitdialingtechniquestocompletesurveyswitharandom,
representativesampleofatleast2,000residentialcustomerswithinFortCollinsUtilitiesservice
area.Theresultingoverallmarginoferrorwillbelessthan3percentata95percentconfidence
level.Priortosurveyexecution,BBCandFortCollinsUtilitiescandiscussanydesireornecessity
tooversamplecertainsegmentsoftheresidentcustomerpopulation.
Survey analysis.TheBBCprojectteamwillberesponsibleforcompilingandanalyzingalldata
fromthesurvey.Aspartofthatprocess,BBCwillperformacustomersegmentationanalysis,
whichwillaccuratelyidentifydistinctsegmentsofresidentialcustomersbasedoninformation
aboututilities‐relatedusage,attitudes,behaviors,motivations,andotherinformation.Thestudy
teamwillthenuseotherinformationfromthesurvey—aswellasexistingdatathatFortCollins
Utilitiesmaintains—todevelopdetaileddescriptionsofeachidentifiedsegment.BBCwill
collaboratecloselywithFortCollinsUtilitiesthroughouttheanalysisprocesstodevelopan
analysisplan,discusspreliminaryresults,andconsiderimplicationsoftheresearchresults.
Task 5 – Commercial and industrial customer segmentation.BBCwilldevelopdistinct
segmentsofcommercialandindustrialcustomersandassessotherinformationthatFortCollins
Utilitiesdesirestobetterunderstanditscustomers.Todoso,theprojectteamwillrelyonusage
andotherdatathatFortCollinsUtilitiesmaintainsanddeliverstotheprojectteamandon
informationfromkeypersonin‐depthinterviewsthattheprojectteamwillconductwith
representativesfromcommercialandindustrialorganizations.
Analysis of existing data.BBCwillworkwithMWHtoanalyzeusageandotherdatathatFort
CollinsUtilitiesmaintainsoncommercialandindustrialcustomers.BBCwillusethat
informationasthebasisforacustomersegmentationanalysis,whichwillaccuratelyidentify
distinctsegmentsofcommercialandindustrialcustomers.
In‐depth interviews.ThestudyteamwillaugmentdatafromFortCollinsUtilitieswithinsights
thatwegatherfrom40in‐depthinterviewswithrepresentativesfromcommercialandindustrial
organizationsthatareFortCollinsUtilitiescustomers.Informationfromtheinterviewswill
allowtheprojectteamtodevelopdetaileddescriptionsofeachidentifiedcustomersegment.
In‐depthinterviewguidedevelopment.BBCwilldevelopaninterviewdiscussionguidebased
oninformationfromtheprojectinitiationmeeting;conversationswithFortCollinsUtilities;and
ourextensiveexperienceconductingin‐depthinterviewsforvariousstudies.BBCwillcollect
informationaboutmanyofthesametopicsasintheresidentialsurveyincludinginformation
relatedtoutilitiesusageanddemand.BBCanticipatesthattheinterviewwilltakeapproximately
30minutestocomplete.WewillsubmitfulldraftsofthediscussionguidetoFortCollinsUtilities
BBC RESEARCH & CONSULTING PAGE 18 forreviewandapproval.Afterrespondingtothedepartment’scomments,BBCwillfinalizethe
discussionguideandbeginconductinginterviews.
Interviewrecruitmentandexecution.BBCwillworkwithFortCollinsUtilitiestoidentify
commercialandindustrialorganizationstointerview.Theprojectteamwillberesponsiblefor
schedulinginterviewsandconductingthemviatelephone.
Interviewanalysis.BBCwillanalyzeandsummarizedataimmediatelyfollowingeachin‐depth
interview.Wewillidentifythemes,anecdotes,andquotationsthatarerelevanttothe
segmentationobjectives.WewilluseinformationfromtheinterviewstoaugmentFortCollins
Utilitiesdataandtodeveloprich,detailedsegmentsofcommercialandindustrialcustomers.
Task 6 — Reporting and presentation.BBCwillconsideralloftheresearchthatweconduct
toprepareresearchreportsandacorrespondingpresentation.Thereportsandpresentationwill
summarizeresearchmethodologyandresultsandwillincluderecommendationsand
informationregardingbestmanagementpracticesrelatedtocustomersegmentationstudiesand
howFortCollinsUtilitiescanusestudyinformationtodriveutilities‐relatedprogramsand
servicesandachievekeyorganizationalobjectives.
Draft and final research reports.BBCwillprepareacompletedraftresearchreportandsubmit
ittoFortCollinsUtilitiesinmid‐December2014.AssumingthatFortCollinsUtilitiesreviewsthe
reportandprovidesBBCwithcommentsinatimelymanner,BBCwillmakeanysuggested
revisionsanddeliverafinalresearchreportonorbeforeDecember31,2014.Figure5presents
thesectionsthatthedraftandfinalresearchreportswillinclude.
Final presentation.AtthetimeofdeliveringthefinalresearchreporttoFortCollinsUtilities,Dr.
Bawawillgiveanin‐personfinalpresentationsummarizingfindingsandrecommendationsfrom
thestudy.BBCwillworkwithFortCollinsUtilitiestoschedulethefinalpresentationand
determinethemostappropriateaudiences.
Other deliverables.Inadditiontothedraftandfinalresearchreportsandthefinalpresentation,
BBCwillalsodeliver:

Awrittenoutlineoftheprojectscheduleshortlyaftertheprojectinitiationmeeting;

AllofthedatathatBBCcollectsandtheanalysesthattheprojectteamcompletes;and

AseparatedocumentthatdetailsbroadrecommendationsforFortCollinsUtilitiestoapply
studyresultstoitsprogramsandservicesandtomeetorganizationalobjectives(whichwill
alsobedetailedinthefullreport).
2. Anticipated Interactions BBCanticipatesagreatdealofcommunicationandcollaborationbetweentheprojectteamand
FortCollinsUtilitiesthroughoutthecourseoftheentirecustomersegmentationstudy.BBC’s
interactionswithFortCollinsUtilitieswillinclude:

Anin‐personprojectinitiationmeetingwithFortCollinsUtilitiestobeginthestudyandto
discussanyprojectmanagementissues;
BBC RESEARCH & CONSULTING PAGE 19 
RegularprojectmanagementmeetingswithFortCollinsUtilitiesatleasttwicepermonthto
discussstudyprogress,preliminaryresults,andanyprojectchallenges;

AseriesofmeetingswithFortCollinsUtilitiestoreviewthedatathatthedepartment
maintainsonresidential,commercial,andindustrialcustomers;

Detailedmonthlyprogressreportsthatwillincludeinformationabouttheprojectteam’s
workplanandmajorprojectmilestones.

ProcessforFortCollinsUtilitiestoreviewandapproveallstudymaterialsanddeliverables;

In‐personmeetingwithFortCollinsUtilitiestoreviewthedraftresearchreport;and

In‐personmeetingwithFortCollinsUtilitiestodeliverthefinalresearchreportandfinal
presentation.
Dr.Bawa,BBCDirector,willleadtheprojectteam’scommunicationeffortswithFortCollins
Utilitiesduringthecourseoftheproject.
Figure 5. Sections in the Draft and Final Research Reports Chapter
Description
Executive Summary
Brief summary of background research, methodology, results, analysis, and recommendations
Chapter 1. Introduction and Background
Information about Fort Collins Utilities, national trends, and research objectives
Chapter 2. Methodology Methodology that BBC used to conduct the segmentation analyses
Chapter 3. Residential Customer Segmentation
Detailed discussions of results from the residential customer segmentation
Chapter 4. Commercial and Industrial Customer Segmentation
Detailed discussions of results from the commercial and industrial customer segmentation
Chapter 5. Conclusions and Recommendations
Research conclusions, including recommendations related to application of study results
Appendix A. Survey instrument
Survey instrument that BBC used to conduct residential customer survey
Appendix B. In‐depth interview discussion guide
Discussion guide that BBC used to conduct in‐
depth interviews with commercial and industrial customers
BBC RESEARCH & CONSULTING PAGE 20 3. Resources AlthoughBBCwillcollaboratecloselywithFortCollinsUtilitiesthroughoutthecourseofthe
customersegmentationstudy,wewillremaincognizantoftheresourcedemandsthatthe
projectputsondepartmentstaff.BBCanticipatesrequiringthefollowingdepartmentresources
aspartofthestudy:

FortCollinsUtilitiesstafftimetoparticipateinvariousin‐personandtelephonemeetings,
includingtheprojectinitiationmeeting;regularmanagementmeetings;datareview
meetings,thedraftresearchreportmeeting;andthefinalresearchreportandfinal
presentationmeeting;

FortCollinsUtilitiesstafftimetocompiledatathatthedepartmentmaintainsonresidential,
commercial,andindustrialcustomersandtodeliverthosedatatotheBBCprojectteam;

FortCollinsUtilitiesstafftimetoreviewandapprovestudymaterials,includingthesurvey
instrumentfortheresidentialcustomersegmentation;thediscussionguideforthe
commercialandindustrialcustomersegmentation;andthedraftresearchreport.
4. Availability of Key Personnel Keyprojectteampersonnelwillbefullyavailabletoconductthecustomersegmentationstudyin
amannerthatmeetsthehighestresearchstandards.Detailsaboutkeypersonnel’savailability
forthestudyarepresentedinSectionB,Part4andinFigure2.
5. Estimated Hours BBCpresentsdetailedinformationaboutprojecthoursbytaskinSectionC,Part4aswellasin
Figure3.Thoseestimatedhoursincludetimeformeetings,conferencecalls,andotherstudy‐
relatedinteractions.
SECTION E. Customer Engagement Strategy BBCwillengagedirectlyandextensivelywithFortCollinsUtilitiescustomersaspartof
conductingacomprehensivecustomersegmentationstudy.Doingsowillresultinrobustdata
collectionthatwillprovideFortCollinsUtilitieswithvaluableinformationaboutitscustomers.
1. Reaching Customers BBCwillengagewithresidential,commercial,andindustrialcustomersthroughalarge‐scale
surveyandthroughin‐depthanecdotalinterviews.BBChasusedthosetoolssuccessfullyon
scoresofresearchprojectsinthepast.Informationthatwecollectaspartofthesurveyand
interviewswillhelpusachieveallresearchobjectives(fordetails,seeSectionC)andtocomplete
theresearchtasksthatweproposedinourprojectapproach(fordetails,seeSectionD,Part1).
Telephone and online survey.BBCwillconductalarge‐scaletelephoneandonlinesurveyto
developdistinctsegmentsofresidentialcustomersandassessotherinformationthatFort
BBC RESEARCH & CONSULTING PAGE 21 CollinsUtilitiesdesires.BasedonbillingdatathatFortCollinsUtilitiesprovides,theBBCproject
teamwilluseaddress‐basedsamplingandrandom‐digitdialingtechniquestocompletesurveys
witharandomsampleofatleast2,000residentialcustomerswithinFortCollinsUtilitiesservice
area.WewilluseaCATIsystemandonlinesurveysoftwaretoconductthesurveys.
In‐depth interviews.BBCwillconduct40in‐depthinterviewswithrepresentativesfrom
commercialandindustrialcustomersofFortCollinUtilities.BBCwillworkwithFortCollins
Utilitiestoidentifycommercialandindustrialorganizationstointerview.Theprojectteamwill
beresponsibleforschedulinginterviewsandconductingthemviatelephone.
2. Measuring and Verifying Value OneofBBC’sprimarypointsofemphasisinconductingacustomersegmentationstudyforFort
CollinsUtilitiesistoensurethatthedepartmentreceivesgreatvaluefromtheinformationthat
thestudyproducesandfromtheprojectteam’sanalysesandrecommendations.BBCwilltake
severalstepsduringthecourseoftheprojecttomeasureandverifythatFortCollinsUtilities
receivesgreatvaluefromthestudy:

BBCwillusevarioustools—includingMicrosoftProjectandmonthlyprogressreports—to
keeptrackofourprogressthroughoutthestudyandtomakesmakesurethatweconduct
allprojecttaskswithinbudget.

BBCwillworkcloselywithFortCollinsUtilitiesattheprojectinitiationmeetingtodefine
researchobjectivessothatboththeprojectteamandthedepartmenthavesimilar
expectationsabouttheinformationandanalysesthatthestudywillproduce.

BBCwillmeetregularlywithFortCollinsUtilitiesthroughoutthecourseoftheentire
projecttorefineresearchobjectivesasnecessaryandtoensurethattheprojectteamis
meetingthedepartment’sexpectations.

FortCollinsUtilitieswillhavetheopportunitytoreviewandapproveallstudymaterials
andresearchdeliverablestoensurethattheinformationthatthestudyteamcollectsaspart
ofthestudyisusefultothedepartmentandtoensurethatthedepartmentunderstands
howtousethatinformationtomeetorganizationalgoals.

BBCwillusesophisticatedresearchandanalyticaltechniquesthroughouttheproject—
includingadvancedstatistics;web‐basedsamplingandrandom‐digitdialing;andcutting‐
edgesoftware—toensurethatourresearchdesignandanalysisproducesaccurateand
actionableresults.
IfFortCollinsUtilitieshasquestionsorconcernsaboutthevaluethattheBBCprojectteamis
providingatanypointduringthecourseoftheproject,BBCwillbehappytomeetwiththe
departmentandaddressthosequestionsimmediately.
BBC RESEARCH & CONSULTING PAGE 22 SECTION F. Fees Figure6presentsBBC’sproposedfeesandhoursforconductingthecustomersegmentation
studyitemizedbyprojecttask.AspresentedinFigure7,BBCproposestoconductthecustomer
segmentationstudyforafirm‐fixedpriceof$147,000,inclusiveofallprofessionalfeesand
directcosts.Figure7presentstheblendedhourlybillingrateforeachprojectteamfirmandthe
numberofhoursthateachfirmhascommittedtotheproject.
Figure 6. Proposed Fees by Project Task Total project team hours
Project task
Task 1 ‐ Project initiation and management
Task 2 ‐ Data review
Task 3 ‐ National trends analysis
Task 4 ‐ Residential segmentation
Task 5 ‐ Commercial, industrial segmentation
Task 6 ‐ Reporting and presentation
Total
Professional fees
Direct costs
Total
25
32
43
1,502
186
162
$4,085
$4,340
$5,645
$84,600
$22,780
$22,250
$200
$0
$0
$0
$3,000
$100
$4,285
$4,340
$5,645
$84,600
$25,780
$22,350
1,950
$143,700
$3,300
$147,000
Figure 7. Blended Hourly Billing Rate by Project Team Firm Project team firm
BBC Research & Consulting
Davis Research
MWH Global
Total firm hours
Blended billing rate *
599
1,301
50
$127.21
$46.12
$150.00
Note: BBC computed blended billing rates by dividing each firm’s total professional fees by each firm’s total hours on the project. Billing rate calculations did not include direct costs. SECTION G. Sustainability Philosophy and Approach BBCiscommittedtopromotingsustainabilityinourbusinessactivities.Concernforourphysical,
social,andeconomicenvironmentisessentialtoouridentityasafirm.Weadheretoand
promoteeffectivesustainabilitypractices;strivetoreducetheenvironmentalfootprintofour
BBC RESEARCH & CONSULTING PAGE 23 businessactivities;andprovideourclientsandpartnerswithservicesthatarerootedinthe
principlesofsustainability,whichare:

Tointegratesustainabilityconsiderationsintoallofourbusinessdecisionsandactions;

ToensurethatallBBCstaffarefullyawareofoursustainabilitypolicyandarecommittedto
implementingandimprovingit;

Tominimizetheenvironmentalimpactofoffice‐relatedpurchasesandactivities;

Tomakeclientsandcolleaguesawareofoursustainabilitypolicyandencouragethemto
adoptsimilarpractices;and

Toregularlyreviewandimproveoursustainability‐relatedperformance.
BBCisengagedinavarietyofeffortstoputoursustainabilitypolicyintoaction.Wemakethose
effortsintheareasoftravel,resourceconsumption,andgeneralworkpractices.
Travel BBCmakesseveralsustainabilityeffortsintheareaoftravelandcommuting:

BBCstaffisencouragedtominimizetravellingformeetingswhenotheralternatives—such
asteleconferencingandvideoconferences—areavailable,practical,andeffective.

Whenwedotravelinperson,BBCtakesmultiplestepstoensurethatmeetingsare
conductedasefficientlyaspossibletoavoidhavingtomakemultipletrips.Examplesof
thoseeffortsincludeproducingdetailedagendastohelpguidemeetingproceedingsand
combiningdifferentmeetingswithmultipleaudiencesintosingletrips.

BBCsupportsalternativeworkingarrangementsforourstaff—includinghome
telecommuting—toreducethefirm’senvironmentalfootprint.

BBCencouragestheuseofpublictransportationbybeingbasedinadowntownDenver
officethatiseasilyaccessibleviapublictransitandbypurchasingmonthlypublictransit
passesforourstaffuponrequest.

BBCsubsidizesbicyclepurchasesforstaffwhopledgetocommutetoworkviabicycle.
Resource Consumption BBCmakesseveralsustainabilityeffortsintheareaofresourceconsumption:

BBCminimizesouruseofofficeconsumables.Forexample,asstandardpractice,weavoid
printingwheneverpossible,andwhenwedoprint,werequireittobedouble‐sided.

BBCpurchasesrecycledpaperproductsforprintinguse.

BBCmaximizesouruseofemailandelectronicmeansforinternalandexternal
communication,includingwhenwedeliverlargereportsandpresentations.

Werequirethereuseorrecyclingofofficewaste,includingpaper,toner,electronics,and
otherequipment.

BBConlypurchasesenergyefficientofficeequipmenttoreduceenergyconsumption.
BBC RESEARCH & CONSULTING PAGE 24 
BBCiscurrentlylocatedinaLEEDSilverofficebuildingthatprovidessingle‐stream
recyclingservices.Inaddition,weparticipateinaprogramtoshutoffallnon‐essential
lightsonhot,summerdaystoreducethebuilding’senergyburden.
General Work Practices BBCmakesseveralsustainabilityeffortsintheareaofgeneralworkpractices:

BBCstaffregularlyparticipatesincommunityeventsandenvironmentalorganizationsthat
promotesustainability,suchastheAllianceforSustainableColorado,DenverTransit
Alliance,DRCOGBike‐to‐WorkDay,andtheNationalBikeChallenge.

BBCprovidesouremployeeswithaccesstoconvenientworkfromhomeoptions.

Weconductregularemployeetrainingsessionstoensurethatsustainabilityissuesare
representedinourclientwork.
SECTION H. Subconsultants TheBBCprojectteamincludestwoqualifiedsubconsultantsthatwillassistinconductingthe
customersegmentationstudysuccessfullyandefficiently.Bothfirms—MWHandDavis
Research—possessexpertisethatisdirectlyrelevanttothecustomersegmentationstudy.
Informationabouteachfirm’squalificationsforthestudyispresentedinSectionC,Part6.
InformationaboutkeypersonnelfromMWH(Mr.JasonMumm,MWHProjectManager)and
DavisResearch(Mr.JasonKearns,DavisResearchProjectManagementDirector)ispresentedin
SectionB,Part2.
SECTION I. Additional Information ForadditionalinformationaboutBBC’squalificationsforthecustomersegmentationstudyor
aboutourresearchstaff,pleasevisitourwebsiteatwww.bbcresearch.com.Inaddition,foran
exampleofarecentcustomersegmentationstudythatBBCconductedforRTD,pleasevisit
www.bbcresearch.com/images/RTD_Market_Segmentation.pdf.
BBChasnoconcernsorpotentialconflictsofinterestrelatedtomaintainingobjectivity,
recommendingsolutionstoFortCollinsUtilities,orinconductinganyotheraspectofthe
customersegmentationstudy.
BBC RESEARCH & CONSULTING PAGE 25