Why Customer Service Is The New Utilities Battleground

Adam Lyons

It’s fair to say that the utility sector has been caught in the crossfire of political battles in recent years. Price rises have been deemed so big an issue that the government has stepped in – ostensibly to make sure value to the customer is prioritized, but perhaps with political point scoring in mind. The pressure’s on from other directions too; customer expectations are increasing, with more consumer choice meaning nobody’s customers are secure.

Indeed, this year has seen British Gas announce the loss of 340,000 customers (and a 20% drop in profits), while low-cost energy firm Iresa actually collapsed under the weight of 9,000 customer complaints per 100,000 customers.

Although where you live dictates which water provider you use, it’s long been the case that customers can switch energy provider relatively easily if they don’t like the service they’re getting. But this doesn’t exclude water providers from the conversation, as the regulator is making sure they feel the heat of competition by raising the bar for good customer service.

I’m seeing customer service become the new battleground for energy suppliers. Those that win on that front are succeeding in terms of retaining customers and building their base. Those who lose – whether that’s energy or water – are losing big.

Why the customer is always right

A report earlier this year revealed that the so-called big six energy firms’ collective market share is at its lowest-ever level.  This proves the scale of the challenge firms are facing. It’s a perfect storm of high expectations from the people who pay, online advice about how to change tariffs and providers to get a better deal, and more challenger brands than ever vying for their customers.

A look at the most recent uSwitch Customer Satisfaction Report compounds this narrative. Innovators, challengers, and independents are dominating the top 10, with good marks on areas like online experience and the likelihood of recommendation – essentially the places service is measured today.

What unites some of these brands is their digital-first nature, and how that translates to service and customer relationships. Bulb, for example, prides itself on efficiency, both in terms of how it provides energy to customers and how it works with them. Octopus Energy (which tops the uSwitch poll) is succeeding with a digital-first, cloud-based billing and service platform. These challenger brands aren’t looking likely to drop out of the market, either. Some have been bought by major corporations, while others are new entrants with deep pockets, with the likes of Marks and Spencer and Sainsbury’s getting involved.

Today, those looking on at this success must consider how they can regain some ground through their customer service offering. And digital-first utility companies must invest in technology that facilitates great customer service to ensure they continue to grow.

The innovations that make the difference

The key to success in utilities today is mapping transformation efforts to service priorities. AI, for example, can be used to deploy an exceptional customer service response to problems that arise. And robotic process automation (RPA) can deliver a better offer to customers at the point of service, with key systems recognizing a customer and why they’re getting in touch, then directing them to the right people right away.

Central to all of this is effective and intelligent use of data. The collection, storage, and utilization of quality data has the power to drive automation technology, meaning providers can either nullify problems before they take root or streamline the service to resolution. This could result in a situation where the customer not only has no cause to complain, but is actually moved to compliment the provider and recommend its services to other people.

This is the approach all leading utilities providers should be taking. Services should be delivered on easy-to-use and intelligently designed customer portals that help people do everything from changing their tariff to understanding and paying their bills. Suppliers must seek a solution that is designed to help businesses embrace the new technologies that make this kind of service possible. Not least because it’s an open, cloud-based platform that can work with existing systems and not so reliant on a huge amount of work from the IT team to deliver a clear service benefit.

Defining our energy future

To my mind, the challenge for everyone in the market is to keep up with the challengers and retain the customers coveted elsewhere. To achieve this, the industry has to be more innovative. Incremental improvements to existing legacy systems are too slow; you have to embrace the next generation of technologies quickly in cloud-based, fast-to-deploy environments, while your core systems catch up. Because these technologies are key to making the customer experience a pleasant one, which is vital for turning around the often dim view many hold of an industry going through major change.

If you want to know more about what empowered customers expect from energy companies, download the “Consumers Buy Experiences” e-guide.

Adam Lyons

About Adam Lyons

Adam Lyons is a senior, experienced strategy and consulting advisor operating at Board level. He has extensive experience in Technology Strategy and Digital Transformation. He has wide sector experience from a career spanning the energy, industrial and consumer goods sectors. He has an established track record of advising C-Suite clients from strategy through to operating model design and implementation. During his experience working in the “Big Four” and at SAP, he has published thought leadership on the Energy Sector and supported his customers’ transformations, developing the vision, strategy and value they can achieve from digital transformation.