Are energy companies in the last chance saloon with customers?

The recent investigation into the energy market by the Competition and Markets Authority (CMA) concluded that more must be done to get energy companies to engage with its customers – particularly those on what it described as the ‘worst deals’, with around 16 million consumers on a standard variable tariff with one of the big six energy companies.

It was followed by a Which? survey that found 74 per cent of people had not been contacted by their energy supplier about changing their tariff in the four months after the CMA investigation concluded.

The Fair Energy Prices campaign which has resulted is just one of many examples of the pressures facing energy suppliers today and one might well be inclined to agree with Which? managing director of home and legal services Alex Neill, who said “This is the last-chance saloon for the energy industry…”

If it is, then it is also a time of great opportunity. More than 85 per cent of consumers believe it is the energy companies’ responsibility to help them better understand their energy usage according to the Which? survey. This tells us that the vast majority of consumers are open to communication with their energy supplier, if not expecting it. And many more are actively engaging with suppliers as they seek to switch.

Over 6 million consumers switched suppliers in 2015, an increase of 15 per cent on 2014. There is little sign of this trend slowing but price is only one of the drivers for change and ultimately it is the nature of the communication made at these times, and the customer experience, that will make them stay.

The real question then, is not so much whether energy companies are in the last chance saloon or not, but can they rise to the occasion and make the most of what is undoubtedly a challenging situation, but a significant opportunity nonetheless.

For new customers, getting the on-boarding process right from the start is critical. Those that fail at this first hurdle lose not one customer, but potentially all those whom the dissatisfied consumer influences. For existing customers, a proactive approach, the right customer service protocols and a tailored offer are key.

In almost every case it will boil down to the same thing – having the right software systems in place to enable the utility to innovate their product and service offering – and to deliver against customer expectations. From processing huge volumes of meter data from smart metering technologies to the basics of accurate billing, the right software system will give utilities the capability to nurture customers and the flexibility that has become essential to compete in today’s energy market.

No doubt some will simply drown their sorrows and fall by the wayside but for those who seize the opportunity, not only will they exit Alex Neill’s last chance saloon leaving existing customers content, they will be taking many loyal new customers with them.