December 14, 2021 | Wesley van Barlingen and Joseph D. Simpson
The electric vehicle (EV) market is booming and has been doing so for years. The growing adoption by the general public, combined with both businesses' sustainability initiatives and governments’ decarbonization commitments have created an unprecedented uptake of EVs.
From negligible in 2010, to over 10 million EVs on the road today, it’s safe to say that this growth has rocked the mobility sector. And the rise is far from over; Mckinsey & Company estimates that there will be over 130 million electric vehicles on the world’s roads by 2030.
In line with this growth, the EV charging market is thriving as well. According to the International Energy Agency, there were 1.3 million public chargers available worldwide in 2020, and by 2030 this number is estimated to be well over 16 million.
As the rise of electric mobility continues to surge, more and more forward-thinking organizations are opening their eyes to the potential of this new, and rapidly growing market that is anticipated to be worth a whopping US$150 billion by 2030.
As all kinds of businesses start jumping on the electric bandwagon, the big question is, how can your business benefit? This article highlights the 3 most common ways in which businesses –big and small– can benefit from commercial EV charging.
Probably. Simply put: If your business has a location, it can benefit from EV charging. Whilst it may seem obvious for some businesses—such as gas stations or commercial parking lots—to capitalize on this market shift, in reality, the opportunity is laid bare for businesses of all shapes and sizes.
From hotels, restaurants, and supermarkets to commercial real estate companies, cinemas and even sports stadiums, all kinds of businesses can gain from adding EV charging facilities.
By tapping into this new market, businesses can increase direct revenue by setting charging fees, offering a convenient service, visibly improving their sustainability reputation, increasing the time customers spend at their location (and using that as an opportunity to upsell products and services) and attracting new and high-value customers that are looking for a place to charge their vehicle.
The experience of charging an electric car is completely different from having to fuel up a tank with gas.
Traditionally, drivers of vehicles with internal combustion engines (ICE vehicles) will visit the gas station when their gas gauge is nearing empty: they won’t just stop off at a gas station if they don’t need to. However, with electric cars, drivers have considerably different behavior when it comes to how and when they charge their vehicles. While the majority of charging will happen at home, your business can help ease drivers’ range anxiety by offering them the convenient option to top off their vehicle while they park.
This might sound strange at first but think about leaving the house with your mobile phone at 90% charge compared to leaving the house with only a 20% charge. The latter sounds a lot more stressful, and since electricity is so accessible, I bet you’ll feel more at ease when finding a place to charge it.
The same goes for electric vehicle drivers, and your business can offer them the readily accessible charging they're looking for.
Of course, there are multiple ways to offer EV charging at your location. Before you decide to enter the EV charging market, it’s important to consider why and how your business can benefit. To help you think about the possibilities, we’ve listed the three main commercial charging station strategies.
Increasing revenue by adding a new revenue stream to your existing business is the first option most businesses consider when looking at commercial EV charging stations.
By charging your existing customers for, well, charging, you can simply take an asset that you already own or manage—parking space—and monetize it.
Consider it like this: while the parking lot used to be a place where people could conveniently park their vehicle whilst they’re visiting your business, with EV charging stations, you can start earning money before they even enter your establishment.
The potential of this additional revenue stream can be very attractive. Of course, the revenue you can generate is dependent on many different factors, such as the daily amount of charging sessions, the fees and tariffs you set, the type of vehicle your customer drives (and how much it still needs to be charged when arriving at your location), the type of charger you install, and so on.
However, to give you a ballpark idea of how much revenue a charging station can generate yearly, we created a simplified estimation for both AC and DC charging stations (in case you’re wondering, there is a huge difference between AC and DC and it affects the speed of charging drastically)
For example, for a location that decides to electrify two parking spots with two AC charging stations, the added annual revenue from EV charging could be between €4,000 and €14,000 a year*. A business looking to add a higher-powered DC charging station with a similar set-up could be looking to earn between €10,000 and €40,000 a year*.
*The calculation is based on an average starting fee and tariff per kWh, the low estimate represents one charging session per day per charger, and the high estimate represents four charging sessions a day per charger. These results are calculated with our revenue calculator and are meant to give a general estimation and are not to be taken as an accurate representation of –or guarantee for– actual revenue generation.
By tapping into your electricity network and existing assets, you’re creating an opportunity to increase your revenue, boost the average customer spend per visit, and offer an in-demand service at the same time. If you want to get a clearer estimate of how much money EV charging can bring your business, download our free EV charging revenue calculator or have a more detailed look at how you can make money with EV charging stations.
How much you will earn with EV charging depends on which fee structure your business selects. With the technology available today, it’s possible to choose a set-up that compliments specific circumstances. For example, you can charge customers per kWh of electricity used and add a service tariff for the convenience of charging. Or you could choose to set a flat fee per charging session, charge by the minute, or even fluctuate your prices based on different times of the day.
With the right charging management software, you can easily manage your charging stations and optimize the revenue by basing the fee structure on accurate insights such as average energy consumption during off-peak and peak hours, and by monitoring the charging behaviour of your customers.
EV charging stations not only allow you to service your existing customers but also an effective way to put your business on the map and acquire new and quite lucrative customers.
Compared to the general population, EV drivers are more often highly educated, full-time employed, and the owner of multiple vehicles. Also, EV drivers tend to be highly concerned with the environment and more active in looking for places and brands that align with their internal motivations. And as more drivers than ever before are switching to EVs, this creates an opportune moment for businesses to tap into a highly sought-after market.
Just like when people go through transitions in life—like graduating, getting a driver’s licence, landing that first full-time job, becoming a parent, or retiring—their consumer habits change, they begin to create new brand allegiances. For instance, if you’ve just received your driver’s licence, it might be time to explore the type of vehicles that are available (and affordable) to you. If you’ve just become a parent, you’ll have to define your diaper choices and if you’re recently retired, perhaps you’ll consider investing in a new camper van.
The same can be said for when people go electric—they go through a lifestyle change where they transform their habits as consumers and develop new brand allegiances. This creates an opportunity for businesses of all shapes and sizes to gain new, loyal customers who will return to your location to charge.
For instance, imagine an EV driver that plans to do his weekly groceries at the supermarket, or one that is looking for a nice restaurant for a night out. Now imagine, if they can charge their car while going to places they want to visit. The additional convenience might be the reason your business comes out on top in the decision-making process.
As more and more people are switching to EVs every single today, there has never been a better time to tap into this well-to-do market segment.
What’s more, by offering charging on-site, you can attract customers by making your location visible on public charging maps. These new customers are primed for cross and up-sell opportunities while they wait for their vehicles to charge.
As public EV charging stations are visible online, new customers can find your business whilst planning out their journey ahead of time or whilst they’re on the road. While half of all Americans aren’t confident about finding EV charging when they need it, 40 percent still say they are considering an EV for their next car. Establishing your business as one of the places that provide this much-sought-after service could turn your location into an EV charging oasis.
Whether you run a cafe, a hotel, a consumer-goods store, or even a cinema, by having your business registered on EV charging maps such as Google or Apple maps, you can, quite literally, put your business on the map.
Want to see what that looks like in practice? Google search term “electric vehicle charging stations near me” and see for yourself.
Having an electric charging station at your establishment can help your business build loyalty with increasingly environmentally-conscious customers.
In line with, or perhaps as a contributing factor of, the unprecedented uptake of EVs, consumer consciousness is at an all-time high. Whether it’s sustainability issues, justice, equality, or several other social and environmental issues, more and more customers are spending their money in ways that align with their personal views and values.
This is, perhaps, one of the greatest drivers for the rise of electric mobility: according to our research, nearly three-quarters of EV drivers are more likely to say climate change and reducing CO2 emissions in transportation is personally important to them.
This heightened environmental consciousness extends beyond what cars they drive: sustainability-driven EV drivers are willing to pay to exercise their environmental consciousness at multiple touchpoints throughout their day. According to a recent IBM report, nearly six in ten consumers surveyed are willing to change their shopping habits to reduce their environmental impact. And for those who say sustainability is very/extremely important to them, over 70 percent would pay a premium of 35 percent, on average, for brands that are sustainable and environmentally responsible.
Drivers that are looking for a place to charge their EVs will go out of their way to charge somewhere that aligns with their values. This creates an opportunity for your business to align your offering with their heightened level of consciousness and product desires.
Lastly, EV charging shows that your business supports the transition towards sustainable mobility in general. Even if they don’t own an EV themselves (yet), offering EV charging at your location is something many of your customers or guests would like to see. And if they do plan to in the near future, they’ll be aware that your business offers the option to charge when the time comes—the first step in your business becoming a lucrative charging destination.
The transition to electric mobility is undoubtedly one of the greatest transformations happening in our society right now. It’s noticeable not only in the rhetoric from governments and vehicle manufacturers alike but also on our streets.
What’s more, charging stations are the latest additions to the infrastructure we commonly interact with. They’re present on the streets of our cities, at our workplaces, our homes, and service stations along our highways.
This is, however, just the beginning.
While many businesses only look to the latest trends within their industry to stay relevant and profitable. They could do both by positioning themselves as a player in the sustainable mobility industry. By tapping into the continuously growing EV sector with EV charging stations for business, they can increase their revenue, attract more customers and build customer loyalty.
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