Trust is crucial in any relationship – and it’s at a low point between some customers and their energy providers. But if providers focused on renewing this trust, it would go a long way to helping them to deliver on their promises to customers.
The cost-of-living crisis has fuelled a sharp increase in fuel poverty, with many customers asking for help on topics ranging from bills rising beyond affordability and energy debt, to problems with billing and customer service.
And yet, in the latest UKCSI Index, customer satisfaction with the utilities sector had fallen to its lowest level in eight years, ranking energy organisations lowest of all 13 different industries polled.
Rebuilding this damaged trust offers an opportunity for energy suppliers to redefine their relationship with their customers.
In the context of the turmoil in the energy marketplace and macro-environment (fuel shortages, record prices, political instability), consumers are being forced to change their habits, often with their focus more on coping with the cost increases than saving the environment.
The role of an energy company is not to provide guidance to help. But certainly, they can make sure that some helpful information is communicated in the right way, is easy to access and via the right channel – such as providing tips for consumers on their website on how to save on bills.
With current sharp rises and seemingly a lack of stability from either government or providers, consumers are often seeking outside support, such as from Citizens Advice, with only around a quarter (24%) thinking their energy supplier has support available and that information from them has been helpful. National Energy Action found that over half (53%) of the public said “there is no point in contacting my energy supplier about my energy bills as I don’t think there’s any help available.”
All of this should be ringing alarm bells for energy providers.
Consumers are also clear that purpose statements are no longer enough. They seek tangible support and guidance on reducing cost and navigating this period of change. To feel secure, consumers need to see improvements in service, transparency, and clear, open, proactive communication – and the trust that comes with this.
The intelligent move is to get smarter
Smart meters are driving significant behavioural change which, in turn, will help save energy and protect the environment. They also offer significant opportunities to improve the customer experience (CX), in terms of the exchange of information between user and supplier.
The data gathered from smart meters can drive communications that increase customer satisfaction, trust, and engagement and reduce customer enquiries. And energy providers who better understand customers and their behaviour from smart meters can improve the relationship by proactively engaging with tailored tariffs.
Smart Metering Systems (SMS) found that energy use comprehension is already high among the general population, with 64% of non-smart meter owners saying they understand how much energy they use. However, this goes up to as high as 84% once a home has a smart meter installed.
And interestingly, SMS also found that confidence in changing energy usage to save money also increases among smart meter owners: how sure they were that making small changes to how they use energy can make a difference to their bill went up from 76% to 87%.
SMS describes the phenomenon as thus: “The evidence shows that the key impact of smart meter ownership is the instigation of perpetual behavioural change that occurs following installation, with smart meter ownership leading to increased energy saving attitudes and actions.”
SMS is therefore correct when the company recommends that energy providers should actively promote the smart meter usage and their benefits to the non-smart meter user.
Smart metering has the potential to provide real benefits for householders in vulnerable circumstances, therefore the opportunity for organisations is to convey this message in conjunction with government, regulators and other relevant bodies.
Give everyone what they want
Consumers are eager to learn how to make better choices within their budgets, as well as for the planet. This shift is accelerated by the current energy crisis, motivating people to change their behaviour and spending to help them save energy.
Consumers are also clear: they want tangible action and providers with strong green credentials are preferred. Identifiable routes of clear green or low-carbon credentials are essential. Energy providers who demonstrate their commitment and agility are those who will thrive – and the key trend right now is decentralisation.
Accenture has found that “in the energy transition equation, the power has shifted to end consumers – they’re demanding action from policymakers.”
The consultancy added the following: “[Customers] are also setting the agenda on what they expect from their utilities, and how they want to play in the energy transition. We’re witnessing a democratisation – e.g. distributed energy resource (DER) technologies, enabling customers, not just utilities, to make investment decisions.”
Accenture is predicting that a two-way relationship between utilities and customers is going to accelerate, with ‘embryonic innovations’ such as electric vehicle-to-grid scaling, and that the nature and connectedness of customers and energy providers is set to be truly transformed.
Indeed, the firm found that energy suppliers are already well aware of this, with 78% of energy providers admitting that those who do not help their customers achieve net-zero with greener products and services will get left behind.
Many others agree. Ipsos, for instance, said: “Online, there is a clear interest among consumers in being part of the energy sustainability movement and doing what they can to support our planetary health.”
The energy crisis has been the catalyst for providing stark evidence of the need to transform the UK energy market and drive its transition from fossil fuels to renewables. Energy suppliers must also reshape their own organisations to better understand exactly what customers want, and then make changes to meet these evolving expectations.
EY’s 2022 Energy Consumers research shows that there is an alarming gap between expectations and satisfaction levels. Factors such as reliability, affordability, convenience and bill transparency are falling short. But across more emotional factors – including treating customers fairly, rewarding loyalty, supporting sustainability, and caring about the community – the performance gap of utilities was even larger, according to the same research.
This is a major challenge to energy suppliers – and an opportunity. Those companies who build better CX can find paths to growth even in tough conditions and help drive the fundamental industry-wide change that will create a more sustainable energy future.
But the opportunity will soon crumble if the trust is not there.
We’ve commissioned a series of reports focusing on energy and other industries to help you understand more about your customers, including how to best connect, support and transform their experience to gain competitive advantage.