water utilities and society
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Overview presentation about the role of water utilities from a macromarketing perspectiveTRANSCRIPT
Water Utilities & Society
Water utilities & Society
What is a water utility?
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.
Coliban Water
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
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
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).
Water utilities & Society
Sustainability
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
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.
Climate Change
Source: CSIRO
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
The Utility Death Spiral
Source: freese.com
Water: ᾿need᾽ or ᾽want᾽?
● Needs– State of felt deprivation
– Innate
● Wants– Shaped by society
– Learned
Source: timvandevall.com
Beyond Needs & Wants
Demarketing
● Lowering demand through marketing– Social marketing
– Price increase
– Restrictions
Water utilities & Society
Social Corporate Responsibility
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
Affordability
● Financial hardship● Empathy● No total
disconnection
Vulnerable customers require protection.
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.
Is water a public good?
Excludable Non-excludable
Rival Private Common-pool
Non-rival Club Public
Water utilities & Society
Summary