How technology can help create a customer-centric utilities business model

Posted by David Costello on 05-Jun-2018 16:19:37

Customer-centricity is the new ideal to which utilities are being advised to aspire – but what exactly does it mean, and how can it be achieved?

Let’s take a look at some of the technological approaches used to deliver customer-centricity across marketing, customer care and feedback gathering.


What makes a utility customer-centric?

Being customer-centric is not necessarily a matter of improving person-to-person customer service – as evidenced by Accenture’s finding that 44% of customers have no interest whatsoever in communicating with energy providers.

Rather, it’s about setting up each B2C touchpoint to offer maximum relevance and convenience to each individual customer. This is made possible through the application of automated sales and marketing technology to in-depth customer data.

For a prime example of customer-centricity in-action, log into your Amazon account, go to the homepage and scroll down. You’ll see product recommendations tailored to your preferences – and if one of them takes your fancy, you can add it to your cart in a few clicks. In a nutshell, it offers you a relevant product, and a convenient way to buy it. Utility providers should be seeking to do just the same.  

That said, utilities clearly require a distinct approach to customer-centricity. Rather than working to expedite repeat sales, the focus must be on a tailored product offering during customer acquisition, followed by superior after-sale care and billing. Given the relative ‘sameness’ of utilities, increased customer-centricity could be one path to differentiation on the market.


Targeted marketing, flexible products

Thanks to customer research and data held on historic customer relationships, utilities have what they need to accurately predict what a certain customer will want, in terms of utility usage, cost and the type of advertising used to communicate the offering.

These insights can be used in marketing activities – for instance, pay-per-click (PPC) advertising with Google AdWords – to deliver tailored advertising for customer segments. Through the use of multivariate testing (measuring the performance of one version of an ad or offer against another), these segments can be refined to a high level of specificity, taking multiple variables into account.

In this way, utilities can market a single product (e.g. an energy subscription) in various ways to suit different customers. Customer A may respond best to the offer of 3 months for £100, while Customer B will favour a year for £400. It’s fundamentally the same product, but marketed flexibly to capitalise on what the seller knows about certain customer types.

The extension of this approach would be the possible near-future scenario in which energy products themselves are tailored and marketed to highly specific user needs.

At present, it would be no bad thing for a utilities company to appear in the search results when someone asks their Google Home or Amazon Alexa, “Which energy provider can give me the best rate on three months’ electricity?” In future, it could be a competitive requirement.  


Customer-centric service and the single customer view

A key mechanic of customer-centric service is the association of data with individual customer accounts, which enables the creation of a single customer view. (SCV)

On the most basic level, an SCV is a customer profile that support agents can access at any time within a customer relationship management (CRM) system. More importantly, it can be used to deliver automated, tailored B2C communications based on what is known about the customer, and about the wider customer base.

This approach can be used for such simple tasks as sending monthly bills in a certain format, based on the customer’s stated preference. More in-depth applications include using data from interactions with a whole segment of customers to predict when a certain customer is likely to lodge a complaint, and using that information to send a pre-emptive message that may de-escalate that situation.


Gathering feedback to create a better service  

Customer relationship data can tell us a great deal about what works best from a customer’s perspective. However, active customer feedback also plays a key role in corroborating data-derived insights, sparking new hypotheses, and ultimate creating a more customer-centric service.

We can gather customer input at every stage of a utilities product’s development – from focus group interviews during planning to the ongoing collection of feedback.

To ensure a tight focus on the relevance and convenience factors that are crucial to customer-centricity, it’s important to include questions based around what customers want and how they want it delivered.

The same technological mechanism used in customer care – the SCV – can be utilised to determine which customers to ask for feedback, and how that request should be couched. Data from across the user base will tell the utility which customers are likeliest to respond, which ones might be irritated by the request, and so on.

You might call this a customer-centric approach to gathering customer-centricity insights, and we feel this demonstrates a key point about the whole topic. It’s about using all the tools and information at your disposal to consistently treat customers exactly how they’d like to be treated.


For more tips of how Utility companies succeed in the disruptive digital transformation era we live in, look no further than the tip sheet below.

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Topics: Utility Week Live 2018

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