Powering better customer service for utility companies

25 October 2013

Tristan Colgate

Tristan Colgate

Former Managing Director

The utilities landscape is in a state of flux.  The water, gas and electricity products market, which has seen prices rise in the manufacturing sector alone by 40% over the last decade, is set to see this increase.

As new entrants make a foray into the market, it could see a domino effect, with a possible outcome being an increase in companies switching for the best deal.

But, when a period of uncertainty prevails, it is often a back to basics approach that is required as a means of fighting competitors. For utilities companies, this means increased focus on customer service and satisfaction. And certainly, there is ground to be made up.

A recent survey conducted by consumer site Which? showed emerging, smaller, recent market entrants had significantly higher satisfaction rates than the traditional big six. One of the latter, Npower, scored just 39% in the poll, while new comer Good Energy – with a commitment to 100% renewable electricity – topped the table with a healthy 85%.

The traditional power houses are under siege, with ever-increasing (mostly negative) media scrutiny, widespread public distrust and Labour leader Ed Miliband’s recent proposal of capping pricing should he get elected in 2015. With a need to invest to keep the lights on as stated in the recent Energy Bill, but with increased choice and options in the market, energy companies need to develop methods in order to stop customers voting with their feet before it’s too late.

Here are a few ideas that marketing and account service teams should consider:

Who is the new energy consumer?

This is the question particularly troubling providers at present, and one it needs to discover quickly. Like with the retail and consumer products, the utilities market is very susceptible to change in attitudes. Taking into consideration the negative stigma associated with companies, consumers are more likely to blame them for rises, despite an overall increase in personal energy use. This is where increased engagement between company and consumer is essential.

While customers may not like price increases, providing better understanding about their consumption as well as the ways of the market would go some way to bridging the gap.

British Gas has attempted to counteract this recently with its “We Look After Your World” campaign, showing the wider public that energy companies do more than light up the earth – citing activities with local businesses, involvement in charitable initiatives and interactive website features. And yet, despite last year being the first provider to cut domestic electricity bills by 5%, it was also number one for complaints about overcharging and needless work in boiler servicing.

As utilities providers expand products, customer service must also become more flexible with it.

Personalised advice

There is also a need for personalised advice, giving the customer better understanding of the options available to them. Doing this will also increase customer loyalty, which is a rarity in a market where everything is sold on price.

An effective use of customer data and popular technology platforms can also be vital platforms in which to provide a service encompassing personalised and consistent customer communication. Utilising this can help customers be better understood, and can have other offshoots, such as personalised campaigns that help reward customer loyalty.

The consumer feeling they are in sync with their provider will go some way to breaking down any issues of mistrust.

Learning from other sectors

As an essential utility, a water, energy and gas supplier has the same customers as other industries, so can use them as a reference point. Two sectors to look at are commercial banking and mobile phone providers.

Banks and telecommunication companies have increased interaction by building ongoing relationships with customers through mobile banking and interactive billing, respectively. If a bank can send a customer real-time alerts regarding their activity – for example, sending a text message to warn a customer that they are approaching their overdraft – why can’t a utilities provider deliver the same service?

As the industry moves into smart metering, it can also learn valuable lessons from the telecommunications industry. In its provisioning, billing and management of smart metering, utilities can learn how to produce a cost-efficient, revenue-generating model in the billing of consolidated services. The technology and software telecoms has adopted to accurately bill customers can be similarly applied to utilities.

By better understanding these billing developments, utilities will be better-equipped to put the customer at the forefront.

Turning negatives into positives

While the utilities market is undergoing a dramatic evolution currently, this also presents the idea of a big opportunity. While price rises are inevitable, changes to the way it approaches customer engagement can provide the revolution that side of the business has needed for years. With entrants set to increase and give the consumer more options, the time to engage is now.

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