Solar photovoltaic installer
) is now teaming up with
) to form one of the first online offers of its kind for solar
systems, a new way to sign up more customers in the increasingly
competitive rooftop solar market.
SolarCity - the country's leading residential solar installer -
announced a deal that calls for customers to pay $1 to Groupon for
getting a $400 discount on a solar installation. This offer will be
available for a limited period in the 15 states in which SolarCity
The $1 bait offered in the Groupon marketplace will fetch more
customer interest for SolarCity's residential panels. Once the
customer purchases the discount, SolarCity will then contact the
homeowner for a consultation. The discount will be effective when
the customer decides to proceed with solar installation and lease.
SolarCity is known for its innovative marketing strategies. The
solar panel maker has in the past partnered with big-box retailers
Best Buy Company, Inc.
The Home Depot, Inc.
) to boost its customer base and popularize residential solar.
Going Online for Solar
The latest partnership with Groupon will not only expand
SolarCity's customer base but also have an extra incentive. This
offer is likely to bring down the cost of acquiring customers.
While adding a customer through a direct sales force might cost
anywhere between $6000 and $8000, winning one at a $400 discount
Last year, SolarCity paid $120 million for the acquisition of
Paramount Solar, a subsidiary of Paramount Equity LLC. And during
the first quarter 2014, operating costs increased even faster than
revenues, at a 138.8% clip. That said, its retained value increased
$239 million to $1.29 billion during the first quarter 2014. The
retained value is an estimate of total cash flows from leases over
more than 20 years.
SolarCity's eye-catching deal with Groupon is a broad push for the
industry into online customer acquisition. The company has already
been building up its customer database internally through Home
Depot stores since 2010 and select Best Buy stores from March this
The company is well supported in its endeavors by a booming U.S.
solar market. SolarCity sees installations climbing to as much as
900 MW to 1 GW by 2015. It also expects a million rooftop solar
customers by 2018. So, these marketing allies, ranging from
brick-and-store retailers to online portals will help the company
to grow its sales.
Tesla Motors Inc.
(TSLA) founder Elon Musk, SolarCity presently carries a Zacks Rank
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