The Utility Customer in 2020 – A Quick, Fresh Look through a COVID-19 Lens
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- Jun 2, 2020 5:01 pm GMT
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Several years ago my utility customer experience colleagues and I penned a series of articles that examined how customer empowerment, sentiment, and the development of new technologies would change the utility-customer dynamic by the year 2020. The series explored five dimensions: digital and social connectivity, information empowerment, customer choice, service expectations of the “digital native”, and the adoption curve of new technologies and its impact on the energy infrastructure.
Of course no one could have predicted that we would be in the middle of a global pandemic in 2020.
At some point we will write a piece on how the utility-customer dynamic has evolved across those five dimensions, how utilities have changed to meet customer expectations in 2020, and how far they still have to go. However, we’ll save that broader analysis for another time, and instead focus on just a few of these customer care 2020 dimensions and their implications on our current COVID-19 world.
Connectivity and Communication are Key
We predicted that by 2020, utility customers would be significantly more socially connected and networked, and suggested that utilities should take advantage of this trend. In the age of COVID-19, connectivity is more important than ever as customers – residential, commercial and industrial – seek information on energy surety in a time of uncertainty. A quick study finds that indeed, most of the largest utilities in North America have a presence on platforms such as Facebook and Twitter. Followership on these platforms has increased over the last several years, but on average still only two to three percent of the utilities’ customer base “follow" the utility on these platforms.
Similarly, mobile apps developed by utilities to make functions like communication, billing, and outage notifications easier are offered by most, but not all, utilities. Yet, according to Oliver Wyman, less than six percent of utility customers on average have downloaded apps, and likely a far smaller percentage actively use those apps. Meanwhile, subscriptions to receive text message alerts are on the rise and have seen some good success, but their use varies widely among utilities in the US. Utilities have long sought to increase digital engagement with their customers, and have found that disruptive events – and COVID-19 can certainly be grouped into that category – present an opportune “moment of truth” for utilities to revisit and promote subscribership to these digital channels. And clearer and more frequent communications – through the customers’ channel of choice – lead not only to better overall customer service outcomes, but also lower transactional costs.
Success with Self-Service
A continued and pervasive shift to mobile, 24x7 customer self-service capabilities was also predicted by 2020. Indeed, the majority of the largest utilities provide mobile self-service capabilities that allow customers to report and get status on outages, pay bills, and check historical usage patterns. A whole cottage industry of cloud-based solution providers has sprung up to provide these capabilities. However less than 15 percent of those same utilities today provide capabilities for active energy management, real time consumption information, and smart home controls – functionalities that certainly a larger proportion of customers would appreciate given recent work-from-home and stay-at-home trends.
A Sampling of 21 Electric and Gas Utilities in the US with More Than 500,000 Customer Accounts
Percent of Sample Utilities with Indicated Android / iOS Mobile App Functionality
Billing / Payment
Smart Home Applications
% of Customers Accounts Who Have Downloaded the Utility's App
App Rating (on a scale of 1-5)
Followers on Facebook as a % of Customer Accounts
Followers on Twitter as a % of Customer Accounts
Source: Oliver Wyman Analysis, May 2020
Another offering that may gain new life is paperless billing. After years of effort to migrate customers in this direction, many utilities peaked somewhere between 50-70% of their customers opting in to this service. As each of us takes precautions to collect our paper mail from our mailboxes during COVID-19, what better way to reduce risk than by eliminating the paper bill entirely. Again, the world we find ourselves in presents a good opportunity to expand efforts to increase uptake of digital offerings, and reduce costs at the same time
Flying in the face of a self-service push, COVID-19 has driven an increase in inbound phone calls for many utilities, mostly regarding COVID-19-driven concerns on aspects such as service interruption, bill payment worries, and the status of service appointments, and some utilities are aggressively hiring to meet this incoming demand. This comes at the same time many utilities have taken aggressive measures to move contact center agents to work-from-home arrangements to keep their employees safe during the pandemic. There are certainly some potential long-term benefits to this – including workforce flexibility and the potential for cost savings and efficiency, as contact center staff can work from anywhere and potentially choose to live in lower-cost regions. However, questions about long-term productivity, ongoing training and skill development, career development and employee retention are still unknowns in this environment. Utilities will have to carefully navigate this customer care balance and consider the implications of immediate actions versus longer-term sustainable operating models.
Doing the Right Thing
We could not have predicted a global pandemic in 2020, nor could we have predicted the economic hardship that goes along with it. So far, many utilities have responded admirably by allowing for payment relief and putting a moratorium on disconnects for unpaid bills (in some cases the utility commissions have driven this directive). But we still don’t know how long and how deep the coming recession will be. Even back in 2015 – the last time the Energy Information Administration (EIA) conducted its Residential Electric Consumption Survey, and at a time when the economy was relatively healthy – over 20 percent of households in the United States were reported to have regular financial challenges meeting their energy needs. 2020 and beyond is shaping up to be far worse.
Amid this tremendous uncertainty, there are all sorts of economic, financial, and regulatory questions to be sorted out. In the short-term, utilities’ customer service operations need to be prepared for the likely surge in credit, collection, and billing challenges and overall customer anxiety. Depending on the depth and duration of the economic fallout, utilities may need to develop new, innovative payment programs, ramp up staff for collections activities, and / or be prepared to write off an increasing volume of bad debt.
Despite the challenges so far in 2020, utilities overall have responded well, working hard to fulfill their core mission of providing safe, reliable, economical energy to their customers. But even as we would like to believe the worst is behind us, utilities – and their customer organizations – must prepare for the potential of a long, uncertain, and challenging future.