Digital first is the way to go

If energy providers instigate the right approach, and connect with customers, digital could offer the solution to building engagement and brand loyalty in a fragmented marketplace, says Peter Veash.

It has been a tough and challenging climate for Britain’s energy providers in recent months. The annual survey into the performance of the UK’s energy companies, released by Which? in January, showed that customer satisfaction has fallen to the lowest ever point, with researchers claiming this is down to the “failings of a broken energy market”. Part of the problem lies with the difficulty energy providers have connecting with customers, as they are missing the more personal in-store and face-to-face experience. Digital channels have opened up a vital reason and way for energy providers to interact with customers more frequently. If these brands instigate the right approach, digital could offer the solution to building engagement and brand loyalty in a fragmented marketplace.
Customers today have a very different set of needs to previous generations. They frequently use digital platforms to interact with brands. With the right digital strategy in place, customers can Tweet a question or check bills while on the move, keeping constantly up-to-date with their energy usage. Energy providers have met this need, but now need to go one step further. Simply operating a mobile application to check payments on its own will result in little more than a frustrated customer. Each interaction with a brand, across any offline or online channel, needs to be successfully linked to create a seamless customer experience at all times.
Edelman’s annual Trust Barometer 2014 found that customers remain distrustful of energy providers. According to the figures, the sector has seen a 32 per cent decrease in consumer trust when compared with figures from last year’s report. Energy brands now have to work hard to gain back customer trust and in the past few weeks we have seen some of the big six taking heed and looking to boost their digital offering. For example, British Gas lately posted a profit loss, but also reported 400,000 customers left it during 2013. To counteract the loss in revenue and appease its remaining customers, it will be introducing a new online billing system.
For energy providers to really connect and build trust with their customers, they need to achieve a consistent experience; a digital strategy now needs to be considered holistically. Brands must identify where customers are spending time, how they choose to interact and tailor communications accordingly. For example, a consumer might review a set of price tariffs from their laptop and on the way home from work use an app to narrow their search further, before committing over the phone. Energy providers need to set the infrastructure in place to join the dots between customers channel-hopping from the offset.
Energy brands will succeed if they integrate internally when developing a digital strategy. SSE, for instance, is looking to more closely map different touch points across the customer experience and under its recently appointed chief marketing officer, it plans to create a team that works to develop all digital solutions. Previously the firm operated different teams to look after each platform, resulting in a fragmented experience for customers.
The challenge energy brands face when engaging customers is similar to that faced by high street banks. Customers rarely have a reason to interact beyond making a payment or having a problem. They are sent bills through the post and there is little interaction with the brand beyond this point, unless there is an issue. The extent to which customers fail to engage with energy brands can be clearly seen by looking at the number of social media followers energy brands have; British Gas (27,600 followers) and Npower (11,500) to name just two. This is extremely low when you compare it with a brand such as Barclays, which has nearly 500,000 followers. To increase customer loyalty, energy brands need to use digital as a way to engage today’s constantly connected customer beyond just making payments or solving a customer service enquiry.
Consumer behaviour is beginning to change as some brands find ways to use digital to increase interaction and engagement. Eon, for example, has created an “energy saving toolkit”, which allows customers to compare bills. Homeowners can compare these with anonymous homes of a similar size and type, as well as energy efficient Eon homes in their local area. Through creating a digital offering that is allowing users to check their energy pricing there is a greater opportunity to engage on a more frequent basis than simply when a bill is received. Energy providers have begun to recognise that to bring brand values closer to consumers’ everyday lives, they need to identify ways to encourage further interaction. This is largely down to an ability to identify consumer needs when it comes to energy. If consumers are concerned about pricing, then creating ways to source additional pricing information through digital means is likely to prove very effective. This could be further extended through content such as information videos or even face-to-face customer service through video calls.
The change in the way consumers think about energy in the context of their everyday lives is set to really evolve as connected devices in the home penetrate the market on a large scale. British Gas already operate smart meters through Hive, but as these devices become more complex, customers are set to become a lot more aware of their day-to-day energy use. This will enable energy providers to greater personalise their offering, which may change from month to month. Digital will form a key part of this change, providing the method for customer interaction based on a real-time understanding of consumers’ usage patterns. Moreover, it is a chance for energy providers to engage consumers more broadly about energy issues, for example creating an app that tracks customers’ impact on the environment, thus encouraging more responsible behaviour. This in turn presents opportunities for energy brands to develop green credentials.
When customer trust remains a key consideration for the energy market, digital has a lot to offer energy brands. As consumers look to access energy services more frequently from a multitude of devices, energy providers need to already be setting the wheels in motion to make this as interactive and engaging as possible. By identifying customer needs and creating a digital offering that reflects them, energy brands can have a bright future ahead.