6 secrets to happier customers (and a happier utility, too)

July 21, 2014 by  
Filed under Solar Energy Tips

Let’s face it: This isn’t your daddy’s power company. These days, utilities have to contend with being more “retail” in their thinking and their strategies. But, it may not be enough. J.D. Power reports that, while over customer satisfaction for residential consumers is hitting a new high, utilities, as a whole, aren’t “keeping pace” with other industries.

“Residential electric utilities have done a great job adding capabilities for proactive communications about outages and upping their corporate citizenship involvement. As a result, customer satisfaction levels have been improving over the past several years,” said Jeff Conklin, senior director of the energy practice at J.D. Power. “However, when comparing satisfaction levels with many other service industries—such as television and telecommunication in which there is a physical connection to a home with a monthly bill payment arrangement—electric utilities are not improving at the same pace in overall satisfaction. Consumers are becoming more familiar with a higher level of service in their daily activities with other service providers and, as a result, their expectations are rising.”

But, don’t panic. Here are 6 tips to help you get past that hurdle and get those contented consumers.


1. Plan for the inundation of smart energy devices.

Parks Research recently released data from their Internet of Things research that revealed a bit of insight not so very shocking—namely that younger consumers are at the forefront of the Internet-connected device revolution. In fact, in the U.S., more than 10 percent of broadband households helmed by people 25-34 own at least one home energy management device and four percent own five or more.  

One would assume that this trend, if it’s got ahold of younger consumers, isn’t going to change but grow. As Daniel Burrus might say: It’s a hard trend. It’s going to happen.

“Seven percent of U.S. broadband households plan to purchase a smart thermostat over the next 12 months, but our findings show consumers clearly prefer smart home systems with extended capabilities that integrate multiple devices,” said  Tom Kerber, director, research, home controls energy, Parks Associates. “Stand-alone products are getting the early attention in this emerging market, but the successful solutions long-term will be able to work together as part of a smart home system.”

Parks isn’t alone in this finding. A Deloitte reSources study this spring found similar results, stating that Gen Y is “keen on getting smarter with energy technology—especially if the price is right.” (Financing and lease arrangements were the biggest suggestion—nothing out of pocket.)

And speaking of cash and pockets …


2. Understand that customers want to follow the money.

It’s Wal-Mart’s “go to” retail strategy—that cheaper is better. But it has been rarely applied to energy and efficiency. However, that is changing. There are more and more studies and surveys on how expensive energy is per state, including WalletHub’s recent 2014 Most Least Energy-Expensive States.

In it, the authors reveal that 7 percent of an American’s income goes to energy. Colorado wins this game at $301 in total monthly energy costs and monthly electricity rates around $83. On pure electricity prices, North Dakota takes the prize with Washington, Arkansas and Idaho following closely.

But the bottom line is: Consumers are thinking more of electricity as a commodity that can be shopped for and adjusted and bargained for like a t-shirt or a car. We’ll all have to get used to that, even if the infrastructure doesn’t support such commodity thinking. (Customers don’t understand that.)

What do customers understand? Good marketing, for one. And the trusted simplicity of repeat purchase of a product they know is a good one.


3. Realize that customers want to invest in a brand.

I know that no utility—perhaps with the notable exception of Salt River Project—really sees themselves as a brand. But that’s the world that’s coming. 

Cogent Reports, a division of Market Strategies International, released its 2014 Utility Trusted Brand Customer Engagement study recently, noting that there is “significant monetary value” linked to trusted brand names. 

And the report found that the higher the brand trust, the greater the needed incentive to switch in a hypothetical exercise. “Based on these findings, we estimate the current goodwill value for scoring high on trust to be over $8 billion. This shows a significant financial benefit for the industry to focus on raising trust levels,” said Chris Oberle, a senior vice president for Market Strategies and the lead author of the report. 

And from that trusted brand, they expect certain things.


4.  Know that customers want more and more.

It used to be that customers wanted one simple thing from utilities—for the lights to come on when they flipped the switch.

But, according to new Accenture research, that’s all changing. The latest installment of the company’s “New Energy Consumer” reports postulates that more than half of customers would consider solar panels or an EV or other “connected-home” devices over the next decade—a rise they label “six fold.”

“The digital revolution is causing industry lines to blur and barriers to entry to all but disappear. This is creating opportunities to provide new, interconnected platforms for innovation that bring the connected-home, electric vehicles and alternative energy sources together. The battle for the home has become a cross-industry one. With traditional business models at risk, leading energy providers will need to move quickly to differentiate from new entrants,” said Greg Guthridge, managing director in Accenture’s utilities industry group.

And your customers don’t just want more devices, they want more sympathy.


5. Empathize with customer frustrations.

We’ve all been that consumer on the angry end of a frustrating phone call to a service company. But what if you applied that knowledge to your own customer service system? 

Interactive Intelligence recently surveyed both consumers and IT professionals to see how preferences and expectations lined up. now, while not all consumers would be IT professionals, one would assume all IT professionals have, at one time, been consumers. Yet, they often didn’t agree.

“This survey uncovered many interesting differences between the attitudes of consumers and IT professionals,” said Joe Staples, Interactive Intelligence chief marketing officer. “For instance, while 61 percent of IT professionals found interactive voice response a valuable service, only 37 percent of consumers did. These types of findings are the first step toward better aligning the expectations of those receiving and providing service.”

Things customers hated: not being able to understand the person on the phone or getting someone condescending. The thing IT pros and consumers agreed on: a timely response is the most important thing.

But, while timely responses will help you with most customers, there’s one segment that will still be a bit of a thorn in your side.


6. Plan for the rise of the energy tech enthusiast.

You know this one. You have this customer already. He’s the one that has every phone app and widget and Nest thermostat and DR/EE program driver and wants all of it to work in synch in real time right the heck now.

And it’s hard to get him to understand that, sometimes, you’re dealing with an antiquated system that just doesn’t have it in her to do all of that at once–or not enough service people or just not enough time.

Here’s the bad news: That market segment is growing.

According to the iControl Networks 2014 State of the Smart Home Report, tech enthusiasts are 32% of their market, and “just having control over the basics” is not enough for them and 78% of consumers ranked energy management as one of the top features that mattered with home controls.

“Energy management features are gaining mass market adoption because they are part of the connected home. The user experience around devices like smart thermostats and smoke detectors are much more compelling when tied into a whole home system that benefits from not only environmental data but also valuable occupancy, weather and historical usage data,” said Letha McLaren, vice president, product management, iControl Networks.

There will be no escaping the tech enthusiast of the future.  They’re getting more and more interested in energy.

In the end, if you can harness that excitement, create offerings for the growing interconnected management segment and still manage the traditional (perhaps frustrated) customer, you’re on the track to overall contentment for them–and for you, too. It’s just all a more flexible, customer-oriented future.


Get more customer secrets to weather that more flexible, customer-oriented future from these upcoming industry shows: Mobile Utility Week, Smart Cities conference or Utility Analytics Week. Mobile Utility Week can get you on the inside track to the tech your customers demand. Smart Cities will show you how to plan for customer desires of the future, and Utility Analytics Week can teach you how to segment customers and their needs to better understand  (and promote) your brand. 






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