When it comes to satisfaction among business customers of gas utilities, one-in-four considers “safety and reliability” to be the most significant factor, according to a new study by marketing information firm J.D. Power.
Other categories gaining responses as top priorities by respondents to the 11th annual Gas Utility Business Satisfaction Study were billing and payment (17%), corporate citizenship (15%), price (15%), customer service (15%) and communications (13%.)
John Hazen, senior director in Energy Practice at J.D. Power, said one of the most important areas driving high satisfaction levels, particularly in the business sector, has been the growing desire of customers to communicate in a concise, simply manner with their utilities.
“The big difference we’re seeing now is the growing business concept of communicating well,” Hazen told P&GJ. “If your company engages its customers, it comes away with higher ratings.”
To that point, of customers who named “safety and reliability” as the most important satisfaction criteria, 34% cited the need for “clarity of information provided about gas safety” as the top reason – not far behind “reliability of gas service” itself, which was cited by 36% of respondents. “Efforts to maintain a safe gas system” was named by 30% of respondents.
By way of comparison to previous years, the combined results for the studies between 2009-15 showed billing and payment grew in importance by 6% (23%), corporate citizenship by 7% (22%), price by 5% (20%) and communications by 4% (17%). Customer service was the only category to drop in importance, falling by 3%.
Field service, listed first by 6% of respondents in the combined results, was replaced as a category by safety and reliability in the latest study.
“Customers compare their experience with utilities to their interactions with other industries,” Hazen said, citing online banking and shopping as examples. “They want the same content and ease they find with other companies.”
While satisfaction with the gas-utility industry continues to improve year-over-year (Figure 2), according to the study, maintaining a safe gas system, while providing “reliable gas service and clarity of information about gas safety, has become a hot button” among business customers.
For example, J.D. Power found that 51% of business customers know about the location of storage and pipeline facilities in their communities. For utility companies found to have communicated this information well, safety and reliability rating fared better.
“The industry as a whole has driven itself to become better at proactive communication,” Hazen said, doing so by relying on a mixture of email notifications, text messaging, and user-friendly websites to keep customers better informed.
The study also found customer recall of digital communication was at an all-time high in the latest study, which led to better satisfaction rankings. “Digital notification” moved into second place behind “direct communications from an account agent” as the most satisfying method of contact.
Among other key findings, nationally:
- The industry continues to improve in satisfaction rankings.
- Energy efficiency increased by 26%.
- Over half (52%) of the respondents’ companies had done a safety inspection in the last six months.
- Customer satisfaction with account representatives reached a new high.
- “Fairness of pricing” rankings improved even though monthly bills increased.
- Only 9% of customers were “unaware of any products or services” offered by their gas utility.
In addition to areas of satisfaction, the study ranked customers’ overall happiness with 61 gas utility companies, which were divided into four regions: East, Midwest, South and West. To qualify the companies had to serve over 4 million customers, with at least 25,000 of those being businesses.
Topping the regions were: Con Edison and Washington Gas, tying in the East; Xcel Energy in the Midwest, Alagasco and TECO People Gas, in a tie in South; and Questar Gas, which for the second straight year finished first in the West.
“The results of this study reflect our employees’ dedication to meeting the needs of our customers, whether they are small businesses or a large industrial complex,” Ken Smith, president of Alagasco, told P&GJ. “We set high performance goals for providing customer service and our employees consistently exceed them.”
TECO was equally pleased with its ranking: “TECO Peoples Gas is proud of our ranking in this survey, especially because this is the first time we’ve qualified to participate,” said Cherie Jacobs, TECO spokeswoman. “This shows that our commitment to customer service carries beyond our residential customer base to our commercial customers.”
In the South, following Alagasco and TECO, which had cumulative scores of 776 on a 1,000-point scale, were Piedmont Natural Gas (765), CenterPoint Energy-South (763), PASNC (757), Atmos Energy-South (749), South Carolina Electric & Gas (744), Texas Gas Service (732) and Oklahoma Natural Gas (730).
Following Questar’s 789 in the West were Southern California Gas Co. (745), Southwest Gas (772), Puget Sound Energy (761), NW Natural (748), Pacific Gas & Electric (743), Xcel Energy-West (741), San Diego Gas & Electric (728) and New Mexico Gas Co. (688).
In the East, Washington Gas and Con Edison (both 761) were followed by BGE and Natural Fuel Gas (both 745), New Jersey Natural Gas (741), UGI (740), NYSEG (734), National Grid (730), and Columbia Gas of Pennsylvania and Peoples (both 719).
“Recognition from J.D. Power is an honor that emphasizes our core mission of helping to make energy an asset by supplying the right information and answers so customers can make smart energy choices,” Tanya Hudson, Customer Service Division head at Washington Gas, told P&GJ, of its No. 1 ranking in the East.
The top finisher in the Midwest, Xcel Energy-Midwest (765), was followed by We Energies (747), Louisville Gas & Electric (741), Black Hills Energy, MidAmerican Energy and Wisconsin Public Service (each at 739), Ameren Illinois and Laclede Gas (both 734), and Dominion East Ohio Gas (733).
The South came out on top among business customers with an overall 754 rating, followed by the West at 750, the East at 731 and the Midwest 726. The overall cumulative rating among all regions was 737. When considering the regions for satisfaction in the area of safety and reliability alone, the South fared best at 781, followed by the West at 775, and the Midwest and East, tied at 760.
“It’s a little bit of a different mix of customer experiences from region to region, which is why we have four lists instead of one,” Hazen said. “The Midwest has weather; it’s not fair to compare the Midwest to Southern California.”
Top safety and reliability ratings nationally were earned by Questar Gas (825), Alagasco (802), Southern California Gas (800), Xcel Energy-Midwest (798), Southwest Gas (797), CenterPoint Energy-South (794), Piedmont Natural Gas (789), NW Natural (787), TECO Peoples Gas (787 and New Jersey Natural Gas (786).
The study was restructured for 2016 to include “safety and reliability” as one of the primary factors contributing to business customer satisfaction.
On the subject of respondents’ outlook going forward, J.D. Power found viewpoints to be fairly stable year-over-year, but the trend is generally toward a brighter future. Beginning in 2013, those who saw their business outlook as “better off” rose from 30% to 36%, while those anticipated their company being “worse off” fell from 14% to 7%. The percentage of those expecting things to stay “about the same” grew from 53% to 56% for the same period.
Other key findings:
- Knowing about and using programs and services are satisfying to customers. Overall satisfaction is higher among business customers using one or more programs than among those using no programs (793 vs. 708).
- There is a 127-point gap in satisfaction between customers who are aware of one or more offerings and those who are unaware of any (746 vs. 619, respectively).
- Recall of digital communication reached an all-time high at 811.
J.D. Power has found over the years that “good companies,” as Hazen put it, remain as top performers from one annual study to the next. Also, the same companies near the bottom, unfortunately, tended to stay near the bottom. However, “Sometimes, an event like a hurricane takes place and the listing is affected because some do well and others drop the ball.”
One nice surprise, he said, was the recent improvements made by Con Edison, which also topped the East electric rankings. “Part of the reason, on the business side, is they are one of the best in proactive communication. They take it seriously and it really shows.”
Invariably, Hazen said, if companies’ senior leaders take a serious interest in customer satisfaction, the company starts moving in the right direction. If not, “the rest of the organization and its ranking mirror that. The nice thing is 95% of the utilities are now awake and focused on improving the customer experience.”
The 2016 study was based on responses from 10,635 online interviews with business customers who spend at least $150 monthly on gas. The study took place from April-July 2015 and August-December 2015.
By Michael Reed, Managing Editor