From artificial intelligence (AI) to voice control and big data, technology is changing how utilities companies communicate with their customers. Our Utilities Lead, Benjamin Lind, looks at some of the big firms that are using tech to transform the customer service experience.
Our electricity, water and gas supplies are all a wonder of the modern world. Switch on a light, run yourself bath or crank the heating up for an hour and you’re seamlessly closing a chain which likely began anywhere from a wind farm off the coast of Cumbria to a gas field in Russia or a water reservoir in the East Midlands.
The process is such a seamless part of our modern existence that it has become second nature. Any disruption to the chain and it can feel like your whole world is caving in, so reliant are we upon our gas, electricity and water.
For the big utility companies, this assumption poses a significant challenge. At the base level, consumers expect uninterrupted service as standard and when this doesn’t transpire they’re inclined to lose their sh*t. With the likes of Amazon raising the bar when it comes to hassle-free customer service, the margin for error when it comes to utilities customer experience is perhaps smaller than it has ever been.
Major energy and utilities brands have adapted well to this brave new world, it has to be said. According to Ofgem, customer satisfaction with supplier service at the UK’s Big Six ranged between 65 and 74 per cent depending on the supplier. Energy providers fared comparably well when it came to how easy it was to get in contact with them too.
Meanwhile, Ofwat, the water regulator in England and Wales, has registered a steady improvement in customer satisfaction surveys across all regions of the UK. Although I’m sure the regulator’s service incentive mechanism which rewards or penalises firms based on their performance has had only a small impact on this progress...
The UK’s suppliers are doing pretty well then, but there is always room for improvement. Despite the Big Six performing pretty well across the board when it comes to customer experience, the number of customers who would recommend their current supplier borders on abysmal. Topping out at 35 per cent of British Gas and SSE customers, and dropping as low as 28 per cent for npower and Scottish Power, the figures highlight just how high the bar is set for energy suppliers when it comes to turning customers into fans.
Price inevitably has a role to play in this perception. But in an industry where 74 per cent satisfaction with customer service equates to just 35 per cent of customers being willing to recommend your service, it’s clear that utilities customer service has to really go above and beyond to foster brand advocates.
So how do energy companies go about clawing back those percentage points and maybe even corralling brand evangelists in the process? Above all else, it’s through the choice, transparency and customer control afforded by the latest technology.
Unsurprisingly, most utilities companies have already cottoned onto this fact and are deploying digital services across their businesses as you read this. As we enter the third decade of the 21st century, these innovations are going to become the key differentiator between service providers and will become the primary medium that consumers communicate with their energy suppliers.
Read on to find out about some the most envelope-pushing innovations going on in the sector at the moment.
The steady rise of the smart thermostat.
Smart thermostats such as Google’s Nest or Hive from British Gas have been around for a good few years now with consumer uptake steady since they hit the market in 2011 and 2013 respectively. The market is forecast to grow to 22m installed units in the European Union by 2020 and 33m units in North America as more and more homes adopt smart devices in their homes.
Not to be confused with smart meters that send energy usage information directly to suppliers, smart thermostats give consumers greater control over their energy usage as well as providing in-depth insights into their usage habits.
The technology allows users to remotely control their heating from a smartphone or tablet wherever they are in the world. Accidentally leaving the heating on all day or walking into a freezing cold house could theoretically become a thing of the past.
At the top-end of the market, advanced smart meters can track your daily routine, monitor how long it takes to heat up your house and pull weather information off the internet to switch your heating on and off at the most optimal times. It can even react to sudden cold snaps with a sudden dip in temperature one morning triggering an algorithm which switches on the heating a little earlier for you getting up.
Combined with real-time readings of exactly how much you’re spending on your heating, smart thermostats have the potential to give energy customers more control and oversight over their energy bills.
For customer service, this means less chance of ‘bill shock’ and more satisfied customers who can see exactly where their money is going and how they can control it.
Making the most of big data.
Cost has inevitably been a barrier when it comes to the uptake of smart thermostats and can partly explain their slow but steady uptake. But convenience and transparency needn’t come at a cost.
Utilities companies have always sat on massive stores of customer data which they would then distil into digestible monthly or bi-annual usage statements. Nowadays though, customers are no mugs and they expect a fully transparent relationship with their suppliers, including easy access to their usage data and account information.
In effect, the tsunami of data that has occurred in recent years, which has allowed us to analyse everything from our spending habits to our physical activity, has swept through the utilities industry as well.
Many of the big energy companies now provide customers with detailed usage information, allowing them to compare data from different months and even predict future usage and cost. One of the first to offer such functionality was Royal Dutch Shell-backed gas and electricity supplier First Utility which provides usage insights through its My Energy app.
Since then everyone from British Gas to E.ON and npower have implemented comparable features in their respective apps.
Providing customers with this information in an easily accessible, concise format helps clients to envisage exactly where their money is going. More than that, it gives them a sense of ownership and control over their consumption, allowing them to better plan for seasonal fluctuations and consider ways to bring their bills down.
To some this might not sound like what they traditionally think of as ‘customer service’, but transparency and control of their own accounts effectively takes the onus off customer service terms to provide the same information. More pressingly, showing exactly where their money is going, and giving them tips on how to decrease their consumption, can only result in happier customers in the long run.
Getting bills and service updates with just your voice.
On the front-end side of things, voice has become the next frontier in the battle of big tech as our homes have become flooded by compliant voice assistants all willing to do our bidding. Voice assistants such as Google Home and Amazon Echo have proven a big hit with UK consumers with one in ten Britons now owning a smart speaker according to YouGov.
In the US, over half of smartphone users make use of voice assistants such as Siri according to a recent study by Voicebot equating to just over 41 per cent of the US population as a whole.
Voice isn’t going anywhere and with usage booming, every industry should be looking at ways that it can be implemented as part of their business offering. Customer service over live chat and social media destroyed whatever patience people had for the call centre gauntlet, and voice will have the same impact on apps and web platforms.
Why go to the bother of unlocking your phone and entering your customer details on an app to find your latest bill when you can simply ask Alexa? This is the question that all utilities companies should be considering.
It is a question we have personally explored here at hedgehog lab too as part of our innovation work with Northumbrian Water Group (NWG). Working together with the water company we developed a voice-activated Alexa Skill which offers customers information on their bills, usage and details of any supply disruption in their area using just their voice.
By combining voice with various data points along the customer journey utilities companies will be able to supply information exactly when customers require it through a medium that is even more convenient and intuitive than social media or an app.
While NWG is still working towards the commercial release of the Alexa Skill, the innovation points to a future where all account-related enquiries can be carried out through smart voice assistants—improving customer accessibility and choice in the process.
AI-powered energy management.
With the UK’s domestic energy market being so competitive and cut-throat, it’s easy to forget that utilities customer service encompasses commercial and industrial markets too.
In fact, energy consumption by the UK’s industrial (17 per cent) and services (14 per cent) sectors combined is marginally bigger than domestic consumption which sits at 29 per cent. The figures underline the fact that household consumers aren’t the only customers that utilities companies should be considering when implementing digital innovation.
It is estimated that medium-sized businesses spend on average £4,208 per year on electricity and a further £1,502 on gas according to Smarter Business. Compare this to the average spend of £1,138 per year by UK households on dual fuel tariffs, and it’s clear why energy companies should be just as interested in keeping their business customers sweet as their domestic consumers.
With such eye-watering sums spent by UK businesses on gas and electric, often the most effective strategy for customer experience is to focus on the customer’s pocket. The energy market being what it is, all gas and electricity suppliers are beholden to the wholesale price of energy; upward fluctuations in cost will inevitably be passed on to customers. As such, achieving price competitiveness can be tricky with such little room for manoeuvre.
If suppliers have their hands tied when it comes to pricing, what options do they have to carve out savings for their customers? One potential opportunity links to the use of transparent customer data we explored earlier.
We’ve already seen how detailed customer data that’s easily accessible and packed with actionable analytics and data can improve customer satisfaction on the residential side of the market. The same is true for business users too, but with the added potential of even smarter utilisation of customer data.
One prime example of this is Centrica-backed Grid Edge. The artificial intelligence (AI) company has developed a machine learning system that is able to learn a building’s energy profile, predict future energy needs and help to control energy generation and storage in real-time.
While we are yet to see any major suppliers roll-out their own predictive energy systems utilising AI, Centrica’s interest in Grid Edge’s technology clearly highlights how much of a growth area it will be in the coming years. Not only will it act as a key differentiator, but it will also provide even more value to business customers without them having to do very much at all.
Good customer service transcends tech.
This might sound strange coming from a Senior Strategist working at one of Europe’s foremost app developers, but not all customers are going to be wowed by some of the digital innovations we’ve covered here.
Tech for tech’s sake is never a good idea and it can often cause you to lose sight of the very people you’re trying to help—your customers.
Digital initiatives are transforming the world of gas, electricity and water as we know it, and will continue to do so over the coming decades. But they are also one of the few industries that cut across every cross-section of society. From the very young to the very old, we all need a roof over our heads with warm running water and functioning heating—particularly considering the depths that the mercury can plunge in this often frost-bitten isle!
As such, utilities companies have a dual responsibility to forge ahead with digital innovation while still ensuring that services remain accessible to every customer no matter what their age or circumstances.
Technology can be a great leveller, but it can also be a great alienator too. Keeping this in mind can help to ensure that digital innovation is being put to good use and is actually improving customer experience rather than hampering it.
Got any more cracking examples of energy suppliers boosting their customer service efforts with tech? Leave us a comment below or hit Ben up on Linkedin.
Catch up with the first episode of Ben's Talking Utilities podcast for mort utilities chat. Martin Jackson, Head of Strategy and Architecture at Northumbria Water, talks everything from the potential of Alexa to common problems faced in the utilities sector.