Europe's energy efficiency services market to reach €50 billion by 2025

02 April 2019

The growing climate change awareness as well as improvement to technology have lifted the market for energy efficiency in Europe to almost €25 billion. Growth will accelerate in the coming years, with the market set to double to €50 billion by 2025. The landscape remains fragmented however, according to a new report.

Climate change mitigation remains a key priority for much of the world – failure is noted as one of the world’s biggest risks going forward. Efforts to meet the Paris Agreement target of no more than 2.0°C warming by 2100, with a strong preference for 1.5°C, mean that transformations of various industries remains a priority. While reductions in the use of fossil fuels is a key part of wider moves to reduce global emissions, improvements to the efficiency of energy produced is a second avenue of improved energy outcomes.

Analysis regarding the improvement to energy efficiency for Europe show that considerable gains will need to be made over the coming decades to meet the region’s commitments. While governments have been keen to push for improvements in the space, companies too have sought to improve their energy efficiency, both to reduce long-terms costs as well as meeting their own goals related to reducing their carbon footprints.

EES is set to become a key European market

In a new report by Roland Berger, the authors analysed the market for energy efficiency services and products (EES), aimed at improving the energy efficiency of buildings, physical assets and business processes. In Europe, the most in demand service is engineering, focused on mobility technology, building technology and process technology, with the total market value estimated to be around €9.5 billion. Contracting, focused largely on energy supply, generates market volumes of €6.6 billion, followed by consulting at €5.2 billion.

As Europe ramps up attempts to reduce the energy waste in many of its systems, demand for services is set to rise significantly in the coming five to six years – at a CAGR of 8% across the various market segments. The market volume is projected to jump from €26 billion to almost €50 billion in the period up to 2025, in the process becoming a "key market in the European industrial landscape.” Software is forecast to enjoy the highest increase in demand, at a CAGR of 14% for the period, followed by engineering at a CAGR of 9%.

Businesses ownership remains split

While the consulting firm has projected strong growth for the market in the coming decade, various challenges for growth are also noted. This reflects the market’s diffuseness and fragmentation, and its relatively competitive nature, as well as the technical difficulty and sophistication of the space. While there are a range of companies focused primarily on developing propositions in the EES space, many established companies are also creating solutions for the space as a diversification strategy of their core propositions.

Fragmentation is the highest in the software industry, where around 60% of total EES activity stems from non-EES focused companies. The consulting segment is the most mixed, with 70% of companies operating in the space having a business focus within and without the industry. Contractors tend to have the strategic focus on the energy efficiency services market, at 70%, followed by operations-focused companies at 60% and engineering focused companies at 50%.

M&A intensity

The fragmented picture in part reflects the effect of acquisitions that are not well aligned with wider business processes and outcomes. Over the past five years around 100 deals were made in the space. Energy services specialists are the keenest to invest, according to Roland Berger, at 38% of the total, followed by utilities at 16% and investment funds at 11%. However, the researchers note that in many instances the deals were not well matched to the buyer’s wider business model, or were experiments in the segment, which sometimes created risks on their current business model.

For players to succeed in the market, the authors have three pieces of advice. “Players can succeed by following a few relatively straightforward principles. They must build a compelling business case for their customers, using levers such as digitalisation and cost of delivery. They must pursue smart growth through mergers and acquisitions, taking great care not to kill off the entrepreneurial spirit of their newly acquired firms. And they must ensure that they themselves have the right internal setup, with the required flexibility to accommodate strong growth businesses.”

Top digital marketing | e-business consulting firms in the Netherlands

10 April 2019

New research has identified which consulting firms in the Netherlands provide the best services in the area of e-business, e-commerce and digital marketing. A select group of thirteen consultancies lead the pack, headed by local player SparkOptimus, followed by strategy giants McKinsey and BCG, and the Big Four firms Deloitte and KPMG. 

Data sourced from Emerce, a Dutch platform which surveyed over 1,000 decision-makers that have in the past year hired consultants, outlines the consulting firms regarded as the country’s top e-business consultancies.

Amsterdam-based firm SparkOptimus, founded in 2010, received the largest number of plaudits. A rapidly growing client portfolio and stature has seen the consulting firm grow to a team of over 80 consultants, specialised in digital strategy and implementation. “The acknowledgment is further proof that our pragmatic and ‘getting it done’ approach to digital transformation and disruption is widely recognised,” said Tom Voskes, Managing Partner of SparkOptimus.

The presence of McKinsey & Company and Boston Consulting Group (BCG) in shared second position is no surprise – the pair have consistently ranked in the top echelons of the list for several years now. McKinsey provides its digital marketing services through its Marketing & Sales and Retail (responsible for the firm’s e-commerce and omnichannel propositions) practices, while digital support is provided by McKinsey Digital. BCG has similar practices, with its digital capabilities bundled in the firm’s BCG Platinion (technology build and implementation) and BCG Digital Ventures (incubation and prototyping) arms.

Both Deloitte and KPMG also rank among the leaders in the Dutch consultancy space for e-commerce and digital marketing. They have similarly grown to be regular names in the ranking, with the duo of Big Four firms making the top 10 for the past three consecutive years. KPMG offers its digital marketing and e-commerce services from its Customer Advisory practice, which is part of KPMG Management Consulting, a unit within KPMG Advisory. The service line offers six main propositions, including Customer Experience, Marketing, Customer Data & Analytics, and Customer Centric Organisation. At Deloitte, the relevant services are provided by the Customer Strategy and Sales & Marketing units, both part of Deloitte Consulting. Technology and creative support falls under the responsibility of Deloitte Digital.Top digital marketing | e-business consulting firms in the NetherlandsHot on the heels of the top ranked digital marketing consultancy players is a group of six consulting firms. EY and PwC complete the presence of the Big Four, with Accenture another global giant that has made the cut. EY has several service lines that cooperate to cover its e-business portfolio, including Customer, Strategy, Program Management, People Advisory Services and Technology. At PwC, strategic work is picked up by Strategy&, while PwC Consulting houses the expertise around implementation and technology. Accenture meanwhile uses its Strategy division to provide management consultancy to its customers, while Accenture Interactive and Accenture Digital take on creative and technology work respectively.

Also on the list, Boer & Croon is a management consulting firm and provider of young executives with a track record of over four decades in the Benelux, DigitalWorks is a specialist in the field of digital marketing, branding and campaign management, while Online Dialogue specialises in conversion optimisation from digital channels and marketing campaigns.

Completing the list of the Netherlands’ top consulting firms for e-business and digital marketing are EY VODW – formed late last year when EY acquired local player VODW, a leading marketing & sales and digital consultancy – and Cognizant, a US-headquartered technology firm that has a strong presence in the digital customer experience landscape. 

The ranking comes at a time when investments in the field are booming. The rapid digitisation of business models, the rise of new consumer demands, and the emergence of online as the mainstream channel for business means that organisations face a burning need to adjust – or else risk losing their competitive edge. From the development of new online strategies and business models to the integration of e-commerce within a broader brick-and-mortar approach, or the optimisation of the customer journey to the implementation of supply chain systems to ensure on-time delivery to clients, external consultants are playing a key role in helping clients successfully navigate the challenges. 

Related: The 25 best management consulting firms in the Netherlands.