In a largely commoditized industry such as energy, it might seem like there’s little that utilities can do to win more business other than how they price their services. By definition, price is what commodities are based on, yet there are opportunities for energy utilities to break from the ranks and differentiate themselves by improving customer experience.
“In the past, many sector companies were monopolies that didn’t interact closely with their end customer. That’s changed dramatically in recent years,” writes PwC in the power and utilities portion of its 2016 global CEO survey, noting that changes like deregulation in the industry has given consumers more choice, along with the advent of new technology in power generation and distribution.
In fact, in that survey, 83% of power and utilities CEOs said that customers now have a high or very high impact on their strategy.
The Benefits of Good Customer Experience
Investing in customer experience can be a win-win situation for companies and their clients. As customers get more of what they’re looking for, they’re willing to pay more for that service.
Specifically, a 2014 American Express survey found that 68% of consumers are willing to spend more for excellent customer service. And on average, those consumers are willing to pay 14% more.
Of course, price is still important, as 51% said that providing good value for the price is the most important factor when choosing a company to do business with, yet 20% chose excellent customer service, which makes it the second most important factor in that survey.
The Costs of Poor Customer Experience
If companies do not provide quality customer service, they lose out on more than just the potential for customers to pay more for their services. Instead, they lose out on existing customers and potential new ones wary of conducting business with a company with a bad reputation.
The American Express study found that 60% of consumers intended to conduct a transaction within that past year but decided not to because of poor service. Furthermore, a 2015 Accenture survey found that 52% of U.S. consumers switched a provider in the past year because of poor customer service.
How Utility Companies Can Work Better with Clients
There are many ways for utilities to improve customer experience, such as with faster response times to customer queries. While those types of changes often meet the baseline of what customers expect nowadays, there also steps utilities can take to exceed customers’ expectations, such as by helping them save on their energy costs and improve sustainability.
Doing so might seem contrary to a utility company’s goals, but it is important to do so to retain customers rather than losing them to grid defection strategies. Plus, some regions have regulations requiring a designated portion of energy sold to come from renewables.
By offering their customers energy analytics software (EAS), utilities can get a closer look at how their customers use energy so that they can recommend products, services and incentive programs that align with customers’ energy goals.
The PwC study found that 62% of power and utility company CEOs are concentrating on improving how they communicate on their environmental impact, and working with clients through EAS provides clarity to customers that the utility is there to help them improve on this front.
Making this effort shows clients that utility companies are not all commodities — some do offer services that matter more than just the price.
Request a complimentary energy efficiency assessment to find out how Artis Energy’s RTIS® energy analytics platform can provide you with the visibility and insight to transform energy from a fixed cost into a distinct competitive advantage.