Utilities Gain With Focused Customer Communications

December 2011, Vol. 238 No. 12

Chris Lewis, Cognera Corporation, Calgary, Alberta

Today, many utilities are using online tools and social media to connect and share information with their customers. But what about the one, consistent touch point they have every single month – the utility bill? Can utilities use the monthly invoice more effectively to reduce costs or does there need to be a larger communication strategy in effect?

Who is involved? When we talk about utility companies looking at strategies to reduce costs, this certainly is not a new concept, and one that does not apply just to the utility organization itself. In today’s world of outsourcing, deregulation and changing technology, there are many organizations that integrate with a utility’s overall customer billing process. For example, social media, phone/text, Internet providers, banks/online payment companies and many others can all touch this process and affect a customer’s opinion of his or her utility company.

All customers can benefit from more proactive communication and education from the utility, whether it is residential, commercial or industrial. The question is – what information is important to which customer segment and how do they want to receive this information? A 60-year-old residential customer and a 35 year-old store manager have very different customer service expectations of their utility and would want to interact with the utility in very different ways.

Although customer segments have different expectations, their utility bill is a consistent, common form of communication that can be much more than just an invoice for payment. Depending on the audience, it can be integrated with other technologies to educate customers with the intent to reduce in-person incidents and issues, thus reducing a utility’s cost of serve.

So what do utilities talk about? That is the magic question. Communicating with customers just to communicate is not going to provide any value. The key word is “educating” them.

Utilities need to ask themselves what is important to each customer segment. What do they want to know about and how often? There are many considerations, including the more recent cultural fascination with e-mail, texting and social media. You do not want to spam your customers, so both how and how often you communicate with them will determine if they actually pay attention to the information you are sending.

There are general pieces of information that would likely be useful to all customer segments, over and above the standard information produced on the bill. For example, providing easy access to historical data on energy prices, consumption volumes and total energy costs to date is valuable financial data to track. Most business customers already track and manage this information in there own systems. Much of this information is accessible through online business intelligence and reporting portals offered by the utility or other third-party providers.

So what else? What about information like upcoming rate case applications and commission mandates? The regulatory environment is always of concern to the utility; why not engage the customer in what concerns the utility? Weather predictions or other variables for the upcoming winter season that might affect prices or delivery capabilities would be of interest to many as would continual updates of the impacts of natural disasters.

Even periodic information on the market structure; who are the decision makers and what the process is for change can educate customers and potentially reduce complaints about changes on their bill. Would it be possible to be pro-active with customers about upcoming changes to their rate and provide explanations before the charges hit their bill?

Pro-active communication and education would save time and energy for the utility call center staff if each customer understood rate changes ahead of time vs. experiencing the anger and frustration when seeing a surprise charge on the bill.

What are the options? Using next-generation billing technologies that integrate easily with many of the other means of communication mentioned can give the utility a well- rounded, state-of-the-art approach to managing its customer base.

New information can be provided via e-mail, text messages, links to social media pages (Facebook/Twitter) and also on the Business Intelligence and reporting portals at their disposal. Let us not forget the “old fashion” concept of personal outreach too.

Another option is to simply use the utility bill itself in more innovative ways to educate customers. An analysis of typical issues or complaints would provide insight into what type of proactive communication is required to reduce incidents in the future. Another option would be to use the bill to encourage customers to visit Internet-based communication tools, offer an iPad for signing up and see what happens.

Using not only the bill, but a combination of other technologies that can integrate with it to provide more value and pro-active dissemination of information, could increase customer self-serve ability while allowing the user to define his or her own means by which to be engaged. The internal benefit is the reduction of customer touch points with the utility’s operations or customer service staff, reducing overall cost to serve while improving efficiencies.

A next step would be to develop a pilot program to measure before-and-after results as it relates to cost to serve. You can layer on other education methods as time goes by and continue to measure results (adjust as you go along to best suit customer segment needs).

Again, customizing a strategy based on the customer segments, their demographics and specific needs will increase the value provided.

Will it make a difference? At the end of the day, the movement toward customer engagement and communication is not going away, even in a regulated utility environment. Add to that the fact that the younger generations entering the workforce have significantly higher expectations of technology and getting information with greater detail, faster and in shortened versions – 140 characters to be exact.

What is your organization doing to look at how it communicates with end customers?
Some recommendations:
1) Examine the areas and technology available that can help you to engage customers in pro-active communication and take advantage of opportunities to educate that would reduce your “in-person” contact and reduce costs.
2) Research the advancements in utility-billing technologies that offer a plethora of options for you to engage customers and take advantage of the opportunity.
3) Realize that you have a captive audience that has to pay their bill and expects to receive a communication from you on a monthly basis (at a minimum). Maximizing these interactions by providing valuable information to specific customer segments can dramatically increase customer satisfaction.
4) Also, just because newer technology is available to you does not mean one solution will fit each customer segment. The utilities and energy retailers that will be successful are those that a) can define a communication strategy for larger customer segments, b) develop messaging strategies that best suit each segment’s needs and c) incorporate these strategies into current and future billing technologies.

Chris Lewis
is director, Market Development, for Cognera Corp. He brings extensive knowledge of the deregulated utilities market and a strong understanding of customer data analytics.

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