Meter-to-Cash Digitisation; it s right here, right now and your Customers are demanding it

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2 Meter-to-Cash Digitisation; it s right here, right now and your Customers are demanding it Digital, digital, digital is a word ringing around many a utility company boardroom as both water and energy providers are rightfully focussing on digitalising their businesses, not least a shift towards low cost digital customer engagement channels where real benefits can be delivered. Our online experiences with retailers like Apple, Spotify and Amazon have changed the game completely for utilities with a shift to real-time customer engagement, at the customer s convenience, and via the customers preferred channel. The digital environment necessitating the transformation of utilities is no longer just around the corner; it s right here, right now! While energy utilities seem to be well versed in digital for the most part, water utilities are playing catch-up and with the competitive market on the horizon in the UK, it needs to shift gear to close the gaps soon. Shifting customer engagement to lower cost channels like s, web-chat/online messaging, SMS and Social Media (to name a few) is clearly a no-brainer. But is it quite that simple? The growth of the tech savvy Millennials, Gen Xs and Ys who will account for 50% of the UK workforce by 2016, and are therefore likely to be involved in utility purchasing decisions, is a key statistic for energy and water companies alike. These customers have enthusiastically embraced technology such as mobile internet and social networking and are on the lookout for the next digital trend to make their engagement process even simpler, more convenient, more gratifying and arguably more public. But this segment is only half of the utility market s audience, and every digital trend and innovation must be met with consideration as part of a balanced approach to customer interaction. The trends in customer engagement channels and technologies The current and emerging trends in customer engagement provide an insight into the level of digitalisation across every market sector utilities must follow suit as consumer demands are universal, they will not tolerate a lower level of service just because they are purchasing energy or water. Their expectations are driven by other online retailers and service providers such as banks, telcos, streaming music services and online TV/movies, deal sites and many more. The boom in social media is set to continue, most organisations are becoming well versed in engaging consumers through Twitter and the like. The necessity for using social media platforms appropriately is well established and understood by many utilities, but there are still plenty of other channels yet to be fully utilised in the industry. There is a growing trend for embedding customer care into mobile apps which are assuming greater importance in service providers omni-channel strategies. The next stage involves building in more capabilities to apps such as webchat, callback and instant messaging effectively offering a digital IVR capability for those customers unlikely to use traditional contact channels. The growing use of mobile apps will coincide with the rising use of web chat, destined to become the dominant customer contact channel in the future. Chat will continue to grow in terms of channel representation, as it transitions from website/browser based web chat to live messaging on customer mobile apps. The volume of digital content being generated requires Universal Text Analytics ready to handle increased volume of text. Whether it s messages from mobile apps, social media, web chat, or Visual IVR channels, many businesses are concerned about the dramatically escalating volume of text as customers increasingly engage via digital channels. Necessity being the mother of invention, there is no doubt that organisations offering a solution will prosper in the coming months and are well worth paying attention to. 2 Gentrack Whitepaper Meter-to-Cash Digitisation

3 The emergence of digital and the proliferation of digital channels and its growing use is clearly a key consideration for utilities, however they are well advised to factor in the persistent generational divide when talking about digitisation. There is no one size fits all! For years to come for example, the telephone, letter and printed bill will remain important communication formats of the baby boomer generation. Generational divides in customer experience Simply put, businesses need to know their customers and deliver services tailored to their requirements. Simply replicating traditional services models into the digital world is not the answer a full digital transformation that touches all customer types is essential. In a survey carried out across the UK by Enghouse Interactive 1, nearly half (45%) of year-olds claimed that a brand s ability to engage with them via social media was important compared to just 16% of the baby boomers. Only 9% of respondents in the millennials bracket said engaging with a company using online communications was not important to them at all, that figure rises to 41% among the 55 and over category. The utilities market does not tailor to a specific audience with current and potential customers spanning every demographic the result is that their communications practice must encompass a mix of traditional means (telephone and letters) and the latest, low cost and convenient digital solutions like Social Media, mobile apps, and SMS. All court different audiences and meet their demands in different ways, understanding the difference in these demands is a linchpin for every utility s future success. Millennials or Gen Y are the most demanding group, however they can be dealt with in the most cost-effective way. They have very high expectations married with low patience levels and 1 featured-digital-articles/the-new-age-of-polarised-customer-service/ the desire to communicate wherever they are in the world with ease. This segment of customers also takes on information differently by learning through collaboration and networks. They expect more options and increasingly make decisions based on peer recommendations rather than adverts, and as a result they are constantly giving each other their opinions and views on products, services, and brand experience on digital platforms. Utilities need to mirror other sectors by deploying digital tools that allow these customers to selfserve at will. Website FAQs, web chat portals and dedicated customer service channels on social media are all core channels for millennials. The older Gen Xs or Baby Boomers want a more personalised human experience. People that fall into this demographic are looking for personal engagement they want to talk to someone who knows and understands them. Getting this tailored customer service and engagement right is vital, it is the cornerstone of every business success as the public prizes customer service very highly when it comes to purchasing habits. Over 40% of the Engage survey respondents said they based their buying decisions solely on an organisation s reputation for customer service. The rise of the customer centric utility OVO Energy is testament to this. The company has spent its time constantly improving its customer service becoming the first and only Which? Recommended Provider for energy in January While the company is not the cheapest energy and gas supplier, it has continued to take a bigger market share as a result of its well-publicised customer oriented approach. This emphasis on customer service underlies the importance to organisations of developing and protecting their reputation by focussing on customer satisfaction. Gentrack Whitepaper Meter-to-Cash Digitisation 3

4 Benefits of digitising customer engagement channels cost savings with moving to low cost channels The benefits of digitising engagement are wholesale for both utilities and consumers alike. And while the requirement to maintain a traditional approach will remain as the generational divide between millennials and baby boomers persists, a shift to digital will see utilities reaping significant benefits. Broader audiences Information hosted or provided through a website, social media channels or via is accessible by a much broader audience (anyone with internet access) than traditional media. The content of the communication can and often will be ostensibly the same a promotional offer, a service alert or even a general company announcement, however the delivery mediums are now omni-channel in nature and reach a wider audience as a result. This maximises the return on investment made in generating the material. Cheaper As digital channels are owned by the communicator, the costs associated with their use drops significantly. There is no requirement to pay for paper, postage, advertising space and most importantly, a reduced requirement for call centre capacity. The cost associated with an increase in personnel needed to manage these channels is easily offset by the reductions in spend mentioned previously. Quicker Communication through digital channels is almost instantaneous, meaning problems can be identified, handled and potentially resolved immediately and cost effectively. This meets the growing demand from millenials for instant gratification and supports higher levels of customer satisfaction and therefore loyalty. Measurable and traceable Perhaps the most important benefit for a utility is the consumer data gathered through digitising its customer engagement processes. Website traffic and behaviour flow, engagement levels on social media, open rates and SMS replies all provide instantly accessible results and datasets. Assessing the success of a campaign or evidencing your customer engagement efforts is achievable with a range of sophisticated and relatively simple to use analytics tools. With the growing trend for digital self-service channels for customer service, typically much cheaper to run than traditional methods, businesses in all sectors are saving money. This is a trend that the utility sector must buy into, and the early movers will be rewarded with increasing customer numbers and loyalty. 6 tips to approaching a digital strategy for your utility business Taking advantage of digital can be a risky effort if it is not properly planned and implemented. It s a significant business transformation requiring technology change as well as a shift in ethos and company values combined with the need for employee buy-in. Utilities must have a strategy in place that allows them to engage proactively with a customer base that is heavily polarised in terms of preference. Gentrack has created the following tips every utility should consider before fully committing to a digital strategy: 1. Take stock of customer personas The first step for utilities is to take stock of your customers and identify the many personas that exist amongst your household and nonhousehold customer base. Segmentation based on these personas will provide input to various customer engagement activities where listening and talking to customers will enable you to identify their priorities and different journeys as they engage with their utility provider. Only once these priorities and values are understood 4 Gentrack Whitepaper Meter-to-Cash Digitisation

5 can utilities start to look at current communication practices and establish whether the right messages are being delivered effectively to the appropriate audience, and via a channel best aligned with the priorities and expectations of the different customer personas. 2. Understand communication platforms At an early stage, water and energy retailers should develop a comprehensive understanding of the various communication platforms and how they can be leveraged to improve customer engagement. Ideally this would be undertaken internally by an appropriate marketing or communication department, but specialised agencies are well equipped to provide this kind of service. 3. Make decisions and think short term Businesses should establish at an early juncture who is going to be responsible for communication for the business, what information they will be issuing and the platforms they ll be using. Agreeing and setting clear guidelines and policies in line with the utility s brand identity at an early stage is also an absolute must. While utility businesses will have long-term strategies and a series of planned projects in place, only short-term developments are of interest to customers. Utilities should communicate whatever changes are going to take place in advance of them being implemented and give customers an appropriate platform to gather information, voice any concerns and provide feedback following the implementation. 4. Think broad Utilities should provide customers with as many ways of getting in touch as possible as very few people have the patience or inclination to wait in phone queues, especially during working hours. , text services, call-back services and online support are all very simple ways of allowing customers to engage with their energy and water providers. 5. Get social Digital natives use social media to interact with brands and service providers, often to complain or share their experiences. This younger generation is starting to take up a larger portion of the utility customer base and their preferred platform of communication must be factored into any strategy. This isn t to say that all communications should be exclusively channelled through Facebook or Twitter, but they should certainly play a role in the development of any strategy. Social media platforms also allow businesses to listen, engage and talk to customers quickly and in a more informal environment. 6. Listen Customers will tell their utility provider what they want so long as they are given the platform to do it. Importantly, the utility company must capture the information effectively and then actually do something with it to show they are listening. Customers who feel that their say actually matters and that they have some influence will be more engaged with their supplier and in the end, more loyal. Implementing a digital communications strategy must be part of a broader shift towards a customer centric business structure and ethos. This comes with a health warning a significant portion of utility product buyers remain outside of the digital-savvy bracket and consideration for traditional communication must also be given. This challenge can be daunting, but by empowering customers to interact with their utility providers more easily using their preferred communication channels, utilities can reap significant benefits. Improved customer satisfaction ratings, more efficient operating systems and an improved public image will all prove beneficial for utility retailers in energy and water markets. Customers are already engaged online with retailers and service providers they now want to take their utilities on that same journey. Gentrack Whitepaper Meter-to-Cash Digitisation 5

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