Even with a wealth of new engagement tools companies can use to prove value to customers, the utilities industry cannot shake its reputation for offering sub-par customer service.
A 2019 J.D. Power survey of water companies, for example, found that proactive communication such as personalised phone calls or emails had a positive effect on customers’ perception of their utility companies. However, just 28% of customers recalled seeing this kind of communication from their providers.
For decades, customers had no choice but to use utility companies for all their needs — no questions asked. The occasional unsatisfying experience was an unfortunate part of being a utilities customer.
Now, thanks to new technologies that have extended the variety and scope for energy and allied services — such as lower-cost solar and photovoltaic equipment, electric cars, and real-time insights into energy consumption — customers have far more influence over how much they consume and which companies they buy these services from. Gone are the days when the only thing customers could do to lower monthly electric bills was flip the lights off.
Today, the changes utility companies have to make are essentially large-scale supply and demand shifts: Customers seek strategic, personalized uses for technology, and utility companies should actively work to meet that demand.
Utility Companies and Customer Experience: 3 Dimensions of Change
Breaking down these shifts in the industry reveals a nuanced picture of what’s truly happening in the utilities sphere. A few areas of change depend heavily on improved customer experience:
1. Customers want options (and more of a conversation), or they demand greater choice and control. Again, today’s customers have much more control over their utilities experience. For instance, they can modulate their electricity use based on peak and non-peak hours, how much electricity they can save or produce with their own home, and how much their use impacts the grid.
All these trends are driving several innovations in the energy marketplace, and they bring many new players that can readily offer such services. The ability to provide these personalized options and control to customers will be the defining DNA of successful companies.
It’s also very likely that high-performing companies will benefit from a “winner takes it all” effect. This is because customers are likely to prefer a one-stop shop for all their energy interactions in order to simplify their lives. Trust, seamless experiences, and mutually rewarding financial models will be key to achieving this.
2. Customer experience is becoming the only success metric. Traditionally, customer engagement has been a stand-alone function for utility companies that were primarily concerned with service requests and fielding customer calls.
Carrying out this function had a very limited impact on utility companies’ overall business plans, which included securing regulatory approval for grid-related investments, customer acquisition and retention, and more. However, due to today’s intense competition as well as regulatory and consumer activism, the ability to track and analyze customer experiences now defines the business model of modern utility companies.
Regulators are even turning to customer satisfaction metrics to determine the fate of utility companies in a process known as performance-based regulation. Moving forward, the successful companies will be those that can find proven ways to attract and retain satisfied customers.
3. Customers want to buy utilities like they buy everything else. With the advent of e-commerce and algorithmic media, customer experience at large has gravitated more toward hyper personalization.
Now, customers — rather than the companies they are buying from — gain increasing control. Customers want to see utility companies show up as applications on their phone alongside their banks, favorite clothing brands, and social media platforms, and this is especially true for younger people.
A 2018 study from Chartwell found that these kinds of mobile apps increased customer satisfaction by 12%. However, utility companies should go beyond simply creating an app. Design thinking and analytics collected to improve user experience are critical in making apps personalized and highly functional.
If one thing is clear, it’s that going digital and getting personal is a crucial part of modern customer experience across all industries, not just utilities.