Smart thermostats like Toon are part of an overarching product category called Home Energy Management Systems (HEMS). These products provide consumers with feedback on their energy usage and consequently help them reduce their energy usage. Recently, energy companies have started offering these devices to their customers. The underlying reasoning for this development is twofold. Firstly, the market in which energy companies are operating is subject to big changes in the nearby future. The decentralisation of energy production is bound to cannibalize on centralised energy sales which is the main source of income of energy companies. Therefore, alternative revenue streams are explored by these companies to compensate for this potential loss. Secondly, it is hard for energy companies in the Dutch market to differentiate from one another. By offering a smart thermostat next to energy contract the chance of selling an energy contract increases. Eneco offers a smart thermostat called Toon to its customers. The thermostat involves a 7 inch touchscreen display on which detailed energy data derived from the electricity meter is shown. The product proposition involves an app with which users can control the thermostat and have access to energy consumption graphs. Furthermore, Toon can be linked to smart light bulbs, smart plugs and a smart smoke detector. Compared to competitors in the smart thermostat market, Toon takes an unique position since it is the only device capable of communicating real-time data on both electricity and gas consumption. Moreover, Toon is very much hardware-focused, trying to obtain a central place in the household by becoming a smart-home platform. However, when comparing Toon to other smart-home platforms the product falls terribly short in terms of compatibility with peripherals and shear value for money. At this point, Toon is struggling to add value to Eneco. The vast majority of Toon is given away for free in a bundle with an energy contract. Within this construction the initial loss is not compensated by the recurring revenue through the Toon subscription at the end of the contract. Moreover, there is a large amount of fixed costs involved regarding Toon which can be allocated to labour and marketing expenses. Currently, Toon is not providing Eneco with the alternative revenue stream they are looking for. However, the product does help them differentiate from competitors and generates income indirectly through energy contract sales. The function of Toon as a marketing tool is confirmed by the atypical composition of its current user base. The fact that the majority of Toon users is not interested in a couple of key points of the product proposition shows that the product is mainly seen as a gift next to an energy contract. Since the future strategy of Eneco for Toon is to sell additional services to its users, the current user base poses a big problem since they are unlikely to be interested or willing to pay for them. The lack of fit between the current product proposition of Toon and its consumers is also found when diving deeper into their deeper underlying values and needs with use of the value proposition design method. The vast majority of consumers is expected to perceive the current product proposition of Toon as a ‘nice to have’ gadget at this point. In order to verify the position of Toon in the lives of consumers, qualitative research is conducted during this project. Contextmapping interviews are conducted with 10 participants from a specific mentality group based on the model developed by Motivaction. The findings of these interviews are aimed at confirming the assumptions about consumer perceptions regarding the current product proposition of Toon. Furthermore, the underlying values and needs of consumers found during the interviews are translated to design goals which serve as a foundation for the development of a new product proposition for Toon. Eventually, a new product proposition of Toon is created based on all the previously mentioned aspects which were analysed. The result is a concept called Toon X, which separates the energy feedback section of Toon from the smart thermostat section. Energy feedback is made readily available for all Eneco customers through a cheap P1-dongle. This way the user base increases from 260.000 users to approximately 1.500.000 users. The large user base facilitates collecting big data about the energy usage of the group and their daily habits. The data is both valuable for process optimisation within Eneco and reselling to other companies. Furthermore, it prevents the government from intervening in the market and it makes Eneco obtain first-mover advantages. The success of this big data solution is largely dependent on the fact that customers keep using it. This is why the smartphone app of Toon has gone through a thorough redesign aimed at providing its users with more adequate feedback. Energy usage is communicated in various layers and is broken up into small manageable pieces while gamification elements are added to the app to keep it interesting for a longer period of time. Furthermore, the app forms a platform for additional services which offers upsell possibilities. One example of an addition to the Toon X concept is the new smart thermostat. The thermostat is merely focused on the strong points of the product category and is consequently considerably cheaper than its competitors which makes it a new standard in the smart thermostat market. The end-result is a new, stronger product proposition for Toon which adds more value to both its users and Eneco.