After a tough year for the global economy, the utilities sector has been ranked bottom of the UK Customer Satisfaction Index. Though disappointing, this could provide the catalyst for firms to take stock of their approach to customer experience (CX).

This latest Index, produced by the UK Institute of Customer Service and known as the UKCSI, finds that customer satisfaction with the utilities sector has fallen to its lowest level in eight years, dropping 2.8% in 12 months.

This decline has seen energy and water organisations rank the lowest of all the 13 different industries polled, their 71.7% average putting the utilities industry bottom, just below public services and transport.

To quote the report in more detail: “Within the utilities sector, average satisfaction with energy companies is 70.3, a decline of 3.8 points compared to a year ago. Their biggest fall in customer satisfaction was for pricing, down 0.9 points compared to January 2022 to 6.0 (out of 10). Average levels of trust and an organisation making you feel reassured decreased by 0.5 points (out of 10).”

The report goes on to reveal that 8% of customers said they have asked a utilities company for help or advice to deal with the rising cost of living, while 10% have been approached by one of their providers offering advice and help. The commentary on the UKCSI suggests that this could mean 90% of customers have not received any contact from a utilities company offering guidance about the rising cost of living.

The utilities sector’s score is its lowest since July 2015, when it came in as 71.4%.

Why are customers so dissatisfied?

In her foreword to the January 2023 UKCSI report, referring to the findings as a whole, Institute of Customer Service Chief Executive Joanna Causon says, “I am concerned this overall average score masks deeper issues that could threaten organisations’ performance, long-term profitability and the quality of customer experience.”

Clearly, declining customer satisfaction is a problem across all industries, and although they find themselves at the bottom of the pile this time, energy and water companies were certainly not alone in having a difficult year.

Out of the 13 industries in the report, 10 had experienced declining customer satisfaction, and of those whose score had improved, no industry saw more than a 0.5% rise. Although there was a decline in the utilities sector overall, UK Power Networks (UKPN) ranked in the top 10 for five key dimensions, with its customer experience, complaint handling, customer ethos, emotional connection and ethics all recognised. Other companies in the sector were recognised for their results, such as Northern Powergrid, which was in the top 10 (across all the industries) for ethics, and Wessex Water and Affinity Water, both of whom had their complaint handling highlighted. And Wessex Water came out as one of the most improved organisations over the past 12 months, with a 6% overall rise to 74.4%.

Exactly why customer satisfaction has fallen is not a mystery. More worried and vulnerable customers are in need, but often companies don’t have the investment to support them. Something else that has certainly not helped with customer dissatisfaction: the concern over customers given no choice about moving onto prepayment meters (PPMs), something that government officials have been asked to draw up measures to tackle.

How should utilities firms react?

Nonetheless, while the UKCSI findings are less damning in context, they can act as a wake-up call for the utilities sector to improve customer experience, a move that can directly lead to increased CSAT and net promoter scores, along with restoring credibility and, perhaps most importantly, trust in an industry that has been so badly affected by the current macro situation.

Firms may decide to examine exactly how they’re training those people to tackle what are often high-intensity conversations. They could review how they decide which enquires to direct towards human beings and which they delegate to automated services. And there are technology options worth exploring which could pay back the investment with customer retention, such as those that free up agents’ time so that they can focus on those customers who are most in need, or systems that prompt and recommend actions that enable staff to give more personalised and helpful guidance. Overall, success can be found by driving efficiency through innovation and using data efficiently.

In an atmosphere of rising costs, skills shortages, supply chain issues and weak economic growth, it’s even more important to improve processes, reduce unnecessary cost and effort and make the right decisions about where to invest money, time and resources. Only the organisations willing to embrace this mindset will come out of the current crisis successfully.

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