The starting gun has been fired and the shadow market is now officially up and running. Meanwhile, behind the scenes, work is progressing on the systems, processes and capabilities that need to be in place to ensure a successful full market launch on 1 April.
From a customer perspective, there is clearly still much to do to raise awareness of market opening, with recent research from the Consumer Council for Water indicating that only 8 per cent of firms are aware they’ll be able to choose a new supplier in less than five months’ time. Of those, an even smaller number are aware of the wider range of benefits on offer.
The one benefit that continually tops customer wishlists is lower bills. However, even here, there is work to be done to manage expectations, because with the low retail margins available we are unlikely to see the huge price cuts and discounts customers expect.
Inevitably, “challenger” brands have been making a lot of the running in raising customer awareness, but it is clear the incumbents need to do more in this space too. While some understandably view the ability for customers to switch as a threat to their business, paradoxically the reputation of the industry as a whole is likely to suffer if the full benefits of competition are not sufficiently promoted to customers.
To avoid disappointment, we must do more to raise awareness of the wider benefits of competition, including improved efficiency, enhanced customer service, and product innovation – all by-products of a well-functioning competitive market.
Despite best efforts, there are always unforeseen issues, events and hurdles that need to be overcome when opening a new market. One lesson learned from other industries is that customers provided with the option to switch can be very unforgiving of companies that make the process more difficult than it needs to be.
For small and medium-sized businesses and charities in particular, problems with data errors, meter reading and billing can cause considerable anxiety and even hardship. While there are fallback mechanisms in place, it’s vital for the sector as a whole that we work hard to anticipate and prevent such teething problems, and that we make switching as seamless and effortless for customers as possible.
This will require a cultural shift from within the industry. A new mindset is required when dealing with customers who can choose to walk away rather than be tied to a provider. With retailers highly dependent on the quality of service delivery and responsiveness of wholesalers to meet the needs of their customers, this will introduce a new dimension and tension within the industry, which won’t be fully tested until the market opens in April.
So, although the initial signs are promising ahead of 1 April, there is still much work to do in order to deliver an effective market which meets, or ideally exceeds customers’ expectations.