Columbia Energy won’t be sinking dollars into a statewide brandadvertising campaign in Georgia like several other retail marketersdid prior to Nov. 1 start-up. Instead, the company plans anaggressive direct marketing program that focuses on attractivepricing and customer service. Columbia is offering Atlanta GasLight (AGL) customers a guaranteed bundled gas delivery price of39.9 cents per therm, a savings on gas costs of 18% for residentialcustomers and 19% for small commercial buyers compared to AGL’scharges over the last six months.

“We’ve just found that especially in a market like Georgia it’sbest to let some of the dust settle in the first month while therewould be efforts by Atlanta Gas Light and even some competitorsthat would be willing to spend and overspend on advertising to helpthe market understand what is going on,” said Jim DeLong,Columbia’s residential marketing director. “Unfortunately, thisbusiness does not support an aggressive brand marketing effort.There are very small margins.”

He said packaging telecommunications, home security and otherproducts with gas and electricity, like some other marketers inGeorgia plan to do, has “never been a model that has worked. Ifsomeone makes it work obviously there would be a reason toreconsider it. But sound market strategy revolves around focus. Whywould you buy home security from a gas company?”

Columbia intends to focus on providing an understandable andpredictable price and excellent customer service. “Our price offeris intended to be in the middle [of the range of retail marketerprice offers],” said DeLong. “We’re not trying to be the priceleader. The price leader probably won’t be there at the end of theday. Certainly being the most expensive is not a sound strategy. Wetry to price our products based on what the customers want and wetry to provide additional value.

Columbia’s rate includes all the costs of gas delivery,including transportation, storage, both upstream and on AGL’ssystem. “There are several competitors not doing that. There’s somewhose price on its face looks low, but you don’t know that becauseit’s just the commodity portion,” said DeLong. In Atlanta GasLight’s program, a lot of the charges are being based on acustomer’s peak day usage, which varies greatly from customer tocustomer.

Columbia gained a big advantage in Georgia by forming analliance earlier this week with Amway. There are 25,000 loyal Amwaydistributors in Georgia. Most, if not all, are likely to sign upwith Columbia, said DeLong. “It will be a very strong start.”

The company also is offering a “satisfaction guarantee” and anew proprietary software, called EnergyHelp, which shows customershow to save up to 30% on their total gas and electric energy costs.Columbia said EnergyHelp retails for $59.99, but will be free toGeorgia residential customers. Columbia will offer the commercialversion of the product for $49.95, a $250 savings.

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