Businessmodel of DTE Energy

Customer Segments

DTE Energy has a mass market business model, with no significant differentiation between customers. The company targets its offerings at commercial, residential, and industrial customers.

Value Proposition

DTE Energy offers two primary value propositions: accessibility and brand/status.

The company creates accessibility by providing a wide variety of options. It offers a broad range of services, which include energy marketing and trading; coal transportation and procurement; energy management services for commercial and industrial customers; independent and on-site power generation; and gas exploration, production, and processing.

The company has established a powerful brand due to its success. Its businesses operate in 22 states. Its main subsidiary, Detroit Edison, distributes electricity to 2.2 million customers in southeastern Michigan, and its power plants have a generating capacity of nearly 11,000 MW. Its Michigan Consolidated Gas (MichCon) unit distributes natural gas to 1.2 million customers. By 2015, DTE Energy was expected to have installed 1,000 megawatts of renewable electric generating capacity, or enough to power 400,000 homes. Lastly, it has won many honors, including the WasteWise Gold Award, Greening of the Downriver Award, and Neighborhood Environmental Partners Gold Award.

Channels

DTE Energy’s main channel is its direct sales team. The company promotes its offering through its website, social media pages, advertising, and participation in conferences.

Customer Relationships

DTE Energy’s customer relationship is primarily of a self-service, automated nature. Customers utilize its products and services while having limited interaction with employees.

Key Activities

DTE Energy’s business model entails generating its energy products and delivering its services.

Key Partners

DTE Energy’s key partners are the suppliers who provide the equipment and materials it needs to run its operations. It also depends on labor contractors and professional services providers.

Key Resources

DTE Energy’s main resources are its physical resources, which consist of the pipelines and plants it uses to produce its energy products.

Cost Structure

DTE Energy has a cost-driven structure, aiming to minimize expenses through significant automation. Its biggest cost driver is cost of goods (fuel, power, and gas), a variable expense. Other major drivers are in the areas of operation and maintenance, fixed costs.

Revenue Streams

DTE Energy has two revenue streams: revenues it generates from utility operations and from non-utility operations.