Regaining customer trust...

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Guest blogger Adele Halsall of Customer Service Guru takes a look at the current climate for energy companies and whether they will be able to regain the trust of their customers…

Over the past five years, the problems facing the energy sector in the UK have become more and more apparent. In January 2014, industry experts at Utilityweek.co.uk reported that customer satisfaction had reached a ‘new low’, falling to 41% from 49% since 2013.

From a total of 17 suppliers, only two were able to increase their satisfaction rates during this time. The most complained-about problems included value for money; customer service; the way in which customer complaints are dealt with and the clarity of bills.

Industry representative Energy UK had insisted in 2010 that it was “working with consumer focus” on issues and that “operations were improving”, but it was in 2011 that industry regulator Ofgem decided to intervene after acknowledging energy companies were failing to meet expectations.

The situation as it is today involves a state of consumer mistrust and wariness of energy suppliers; particularly the Big Six whom have been accused on numerous occasions of dominating the industry. With rising energy prices in 2012, combined with lengthy wait times on phone lines and a growing pile of unresolved complaints, energy companies now have a tough fight on their hands if they hope to re-establish their esteemed place in customers’ hearts.

What’s Being Done?

There have been many shifts felt within the energy industry during the last couple of years, both from companies and authorities, in order to regain customer trust.

Some energy companies have been taking initiative and making their own steps in offering customers a better deal…specifically, the integration of in-home display devices.  These smart thermostats including brands like Hive, Nest and Tado have been bringing a new dimension to energy management, offering intuitive, automated control of one’s energy consumption to eliminate waste and save consumers money.

Combined with their respective apps, users have been introduced to the joys of remote heating and being able to monitor the peaks and troughs of their usage. Earlier in 2014, npower teamed up with leading innovators Nest to offer interested customers a smart thermostat with which to explore these benefits.

Another new introduction has been that of smart meters. In 2010,  smart meters were introduced as a way to simplify customer billing and ensure more accurate household energy costs.

By displaying the amount of energy used in pounds and pence and sending automated readings to the energy supplier regularly, customers will be better equipped to manage their energy usage and budget accordingly. They’ll also only be charged for the energy they actually use. The government hopes to have one installed in every household by 2020

A Rocky Road

Prices are an area that has yet to be dealt with head on, as fluctuating wholesale prices and the pressure to offer greener energy types have made it difficult for suppliers to cut prices straight away.

The Big Six have been heavily criticised for not adjusting customers’ bills to reflect the drop in wholesale prices; yet Energy UK explained that wholesale energy is “just one of a number of costs outside of an energy company’s control.”

The companies usually buy their energy months and even years in advance to “smooth out swings in the market”. When wholesale prices fall, however, it can take a while for bills to catch up.

Energy costs aside though – the level of service provided is paramount to ensuring that customers feel they are getting substantial service for their money. When it comes down to what’s really important to customers, price is often secondary. Numerous consumer studies have shown that people are more inclined to overlook cost of goods if it means they will receive a top-notch service. And by the same token, many are more likely to forgive mistakes and setbacks if they know their complaints will be taken seriously.

In the face of rising prices, therefore, the value of good customer service simply cannot be underestimated. Ofgem CE Dermot Nolan has demanded that suppliers must “explain clearly what impact falling wholesale costs will have on pricing”, should they wish to rebuild consumer relationships. And at a roundtable discussion organised by BT, Volker Beckers, the ex Chief Executive  of RWE npower, said that consumers’ trust needs to be “won back” first, before new products are rolled out.

Whilst improved customer service may not lead to lower energy bills (or vice versa), it’s vital that the former is not overlooked in the struggle to provide the latter. What energy companies can take away is that engaging in clearer, more frequent communications with customers about is going on on the inside, combined with a better complaints-handling system and added extras such as energy-saving products and in-home technology, is more likely to put them on the road to rebuilding customer trust.

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