Jane Asscher, CEO and founding partner, 23red Company strategy, Customers, Electricity retail, Energy retail, Gas retail, Policy, Policy & regulation, Opinion

Jane Asscher says traditional energy advertising campaigns fail to connect with vulnerable audiences.

At the end of last month, Citizen’s Advice filed its super-complaint to the competition watchdog over what has been dubbed a £4 billion “loyalty fine”, highlighting the widespread practice of overcharging loyal customers. The complaint highlighted the fact that the most vulnerable are most likely to be affected because they tend to switch providers less frequently.

Also, many customers who struggle financially are on a prepayment meter (PPM). Customers on prepayment meters struggle to access better deals – a PPM customer could save £221.16 if they switched to the cheapest direct debit tariff on the market.

As a creative communications agency specialising in behavioural change — often with vulnerable audiences at heart — we at 23red can’t help but see that as a failure to reach and connect with those audiences. Traditional advertising campaigns often miss these people, and standard direct comms with long copy about services available are also not suitable for many vulnerable customers who find it difficult to understand. Suppliers rely too much on consumers seeking advice and support.

What they need is bespoke communications programmes that have their needs and potential touchpoints at the heart – perhaps shifting the focus to creating collateral to be used by local support groups, as opposed to ploughing budgets into TV ads.

One project that encapsulates this is Smart Energy For All, for which we led the consultation and resulting strategy. Through this we learnt a lot about what it takes to change the behaviour of these audiences. Smart meters could be a great asset for vulnerable people. They promise that everyone will have more control over what they use and, in turn, what they pay.

The project involved identifying the audiences most likely to have additional barriers to adopting smart meters – barriers including disability, geography, housing type, and energy provision type. We worked with organisations like the National Housing Federation, the Post Office, Age UK and Citizens Advice to reach the most vulnerable.

Ultimately however, regulation and telling people about smart meters isn’t going to be enough to change behaviour.

Even when paying too much, many people still don’t act to change tariffs or providers, particularly vulnerable customers. This is in part due to what is known as ‘endowment effect’. We would rather maintain the status quo rather than risk being worse off, even in the face of explicit information. Understanding behavioural effects like these is crucial if we want to genuinely support vulnerable customers.

In short, utilities companies must engage with disengaged and vulnerable customers – often by understanding how behaviour is truly changed for that group and working with partners to provide support for the individuals involved. Recent social voice research for YouGov shows that this could not only benefit vulnerable customers, but also gain wider support for the company – with 58 per cent of the UK population wanting the brands they use to behave responsibly and 54 per cent believing brands have a responsibility to society.