Connecting with customers as individuals to gain their support in tackling the challenges facing the water sector emerged as a key theme at the Utility Week Customer Summit in Birmingham last week. However, speakers said there is also a need for better education about the water cycle and the public’s role within it.
Previously held notions that consumers “don’t care about water” have been replaced with heightened interest and concern about water, the environment and bills, according to Claire Forbes, senior director at Ofwat.
She described the “180 degree change” in attitudes that resulted in water being “rarely out of the news” recently, saying this interest can be harnessed to encourage positive behaviour around water habits.
However, Forbes warned: “There is an information deficit about water. Research shows consumers lack information about where water comes from, how much they use, its connection to environmental issues, its scarcity and also how to get help paying bills. Just 15% of customers knew they could ask to get help paying bills, so as we review our consumer policy agenda for the coming year, the common thread between all the issues we will be tackling is not only the need to get to know customers better but to help customers get to know water better.
She said the regulator wants to see customers enabled and encouraged to get to know more about where their water comes from so they can use it wisely, as well as becoming better informed about who to contact with a problem or for help and support.
Forbes spoke about communicating with billpayers and regulating in the changing landscape in which more people than ever struggle with bills while simultaneously have higher expectations about water companies protecting the environment.
Ofwat wants to see companies making it easier for all people to pay their bills and offering better support for those in debt, matters on which it will publish updated guidelines.
“We want to see more done to identify customers who need extra help,” Forbes said. “This means looking beyond the bills and finding ways to find vulnerable people.” She added that mental health struggles could be a barrier to seeking available help so the sector should be proactive in recognising such issues and other non-financial vulnerabilities.
Ofwat is undertaking research and work with CCW, Starting Point, Scope, Citizens Advice and others to better understand customers and their needs and will reflect these in its policy making, she said.
South East Water chief executive David Hinton said the company is already making progress in this area, reframing its view of customer engagement to forge closer relationships and tailor messages according to consumers’ values.
Hinton said he was inspired by the previous Ofwat chief executive Cathryn Ross telling water companies not to think of customers as passive recipients their services – which up to that point Hinton admitted South East “probably had done”.
He explained that South East’s was that people want more than a transactional relationship with the company, which prompted a drive for greater engagement.
“Customers don’t want to be passive and if they’re not, it really helps us. They want to get involved, be educated and do their bit,” Hinton said.
South East found billpayers wanted to be “resilient customers” in some areas such as protecting water in the environment, maintaining home plumbing, reporting leaks, using water efficiency products and being aware of their consumption, as well as reacting intuitively to the weather – for example lagging home pipes.
However, the company recognised that not all customers are the same and willingness to engage varies. Hinton said it is therefore important to segment customers to best understand what is important to different groups and what motivates them.
The company identified various behaviours in customers to segment billpayers into values-based groups. These ranged from those living a comfortable lifestyle but mainly looking out for themselves with low social conscience or environmental concerns to those driven by a high social conscience and awareness for the world they live in.
Hinton explained the company uses this insight to target messages according to what is important to each segment and engage in an appropriate way. The company began linking messages to its consumers – such as about winter pipe care together with vulnerability in the colder months, rather than thinking of issues in isolation.