Utility companies are under increasing pressure to help consumers use less energy and put their customers’ interests at the heart of their business models.

The recent campaign launched by the Department of Energy & Climate Change to encourage households to switch energy suppliers in order to find a better deal is a prime example of this pressure. It’s now more difficult than ever for companies to keep hold of their customers, so forward thinking utilities are starting to explore new ways to improve satisfaction levels and, in turn, increase retention.

Research recently carried out by Opower found that 61% of UK customers who have received an unexpected high bill say they are more likely to switch provider as a result. Meanwhile, more than 80% of customers say it is important for their utility to provide them with alerts for unusually high bills, helpful customer support, and personalised information about rate changes. But less than half of these customers are currently satisfied with their experience during their interactions with their utility companies.

Customers are demanding better service, more insight and timely communication from their utility companies. And even though there has been an increase in energy supplier switching, customers can be persuaded to show more loyalty when they have better interactions with their energy suppliers.

Utilities need to deliver value beyond that of a commodity supplier, transforming to become energy service providers. At the same time, customers are becoming more data savvy and are increasingly using gadgets to track exactly how smart they actually are. Utilities that are able to respond to customers with personalised, timely advice and insights will improve customer engagement, levels of trust and transparency, and improve retention.

Engagement

According to Accenture’s Actionable Insights for the New Energy Consumer report, the average European energy customer interacts with their utility for just nine minutes a year. Crucially, the use of engagement programmes enables utility companies to have more positive and fruitful conversations within the small windows of time they do have with their customers.

The rollout of smart meters across the UK by 2020 will provide the means for both customers and utilities to get significant new intelligence about energy usage. Smart meters provide readings as often as every fifteen minutes and this data can be segmented in a number of different ways to reveal trends, usage statistics and engagement opportunities. This can then be used to inform practical and personalised interactions with the energy customer.

For instance, the use of big data analytics by utilities can provide customers with high bill and unusual usage alerts, heating usage analysis, energy saving tips, and time of day usage analysis. Those tracking towards a high bill can take the appropriate action to bring their usage back to its desired level. It isn’t enough to merely present customers with the raw data that smart meters spit out. Customers need insights that they can act upon and the motivation to do so.

In this vein, our most successful communication tool has been offering what’s known as neighbourhood comparisons, insight that compares a household’s energy usage with that of their neighbours. Essentially this plays on the recognised behavioural phenomenon of “normative comparison”, or appealing to society’s wish to “keep up with the Joneses”, by giving customers anonymous insights about how successfully other people in their area are keeping their usage in check.

Combined with personalised practical and timely advice, these insights are proven to “nudge” customers into making sustained energy savings. In addition, this non-intrusive informative engagement has the knock-on effect of increasing customers’ trust in their suppliers – essential if utilities are to retain and grow their customer relationships.

Statistics and personalisation lie at the heart of today’s online society. Our experience has shown that stats and personalised advice are also at the centre of driving engagement among demanding but often apathetic energy consumers. A bit of friendly competition can lead to a change that not only encourages increased energy efficiency, but also saves customers money and improves the quality of engagement utility companies have with their customers.

By providing valuable, practicable insights to customers, utilities can turn those crucial nine minutes a year into positive, informative experiences and meet the service expectation of today’s energy customer. This can help reduce churn and open the door for additional ways to upsell additional products and services to customers. From the customer perspective, price isn’t the only detail they look at - according to our research, the greatest driver of customer loyalty is service experience. Get this right and they will be more likely to show greater allegiance to your energy brand.

 

By John Webster, VP, Strategy and Marketing for Opower EMEA. 

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