Take a moment to imagine this scenario. A business customer calls a utility to question why his energy bill seems higher than previous billing periods. The customer service representative looks at the contextual data and tells the customer that due to a period of hotter than average weather he may have used more energy than usual on air conditioning equipment.
The data on the utility screen also indicates that the business owner may be a good candidate for rooftop solar and a recommendation is made. The customer agrees to follow-up contact with the utility or associated service provider and eventually purchases solar panels.
The energy company has just achieved what the majority of the sector is aspiring to do - crossing over from selling commoditised electrons to differentiated and higher value energy services and establishing an improved customer relationship in the process. The enabling technology facilitating this type of relationship development is a digital engagement platform powered by customer data analytics. [Energy retail services: are you thinking about the human element?
Andy Bradley, Director at Delta-ee, a UK research and consulting company focusing on distributed energy, defines digital engagement as mass personalisation. “Customer data analytics allows an energy company to take their interactions with multiple customer segments to an individual level all at the same time. Energy companies are able to engage different segments in a way that makes each individual within the group feel that the utility understands their position, business or building.”
Focus on Digital Engagement
New research by Delta-ee found that 75% of energy retailers say that customer data analytics is one of the key priorities in their retail business. However the report, released in October 2016, found that only 8% have customer data analytics strategies that are fit for purpose. Bradley says: “The utility industry is coming from a historic starting point of not having customers but having meters. But moving to the future, it’s all about customers. Energy companies are now on that journey, with some further along it than others.”
Business Customers and Digital Engagement
Rolling out a digital engagement strategy for small and medium-sized enterprises is a sweet spot for many utilities as these users are motivated by lower bills and are starting to adopt energy efficiency, demand response, and storage solutions. Indy Ratnathicam, VP, Marketing & Strategy at FirstFuel Software, a US-based digital engagement company, agrees that business is the “tip of the spear” for adoption of non-commodity services. “There are some great options available for businesses today compared to three to five years ago.”
FirstFuel, which works with European energy providers such as E.ON, supplies energy companies with a digital engagement platform that helps personalise customer interactions and opens the opportunity to increase cross-sell or upsell of services. Ratnathicam says: “Customer experience is owned by the utility or retailer and how customer service teams use the intelligence that we provide can lead to better outcomes.”
At the beginning of every implementation, FirstFuel works with the utility to review existing business processes and identify necessary changes and improvements, “which is the most important thing between success or failure of a digital engagement strategy”.
Ratnathicam says E.ON is a great example of a European-based energy retailer that has embraced digital engagement as part of its strategy. He also notes that there are many utilities across Europe that have determined that building better customer relationships is a real key to business growth, to better margins and long-term customer retention.
Value of Customer Data
When asked if utilities need to rely on smart meter data to present personalised information to its business customers, Ratnathicam explains that whatever data you have, you can create a level of personalisation. He told Engerati: “Many customers don’t have smart meters yet . Even for customers on analogue meters sending one pulse a month, there are a lot of analytics using the historical data and our massive database of building energy data” that we can run that we couldn’t do five years ago .
Smart meter data on 15-minute intervals opens up even further possibilities to turn customer intelligence into personalised recommendations for business users, says Ratnathicam. “When a customer queries a high bill, you can respond with an analytically derived answer such as identifying lights being left on over the weekend. This then leads to a conversation about adding lighting controls to business premises and by the way, the energy providers now sells lighting controls.”
Software vs Hardware
Delta-ee’s Bradley advice to utilities creating a digital engagement strategy is to accept that the future of the energy supply industry is data not hardware, which “has huge implications on how you run the business and who you employ”.
On the subject of who within a utility should own customer intelligence and digital engagement, Bradley says the responsibility can sit in a wide variety of departments ranging from retail or marketing director to IT. But he says a lot of energy companies are bringing in heads of digital or data analytics as “digital engagement can’t be driven by IT departments, it has to be led by retail and commercial teams”.
And one last piece of advice from Delta-ee to achieving customer engagement (and the type of customer interaction depicted at the beginning of this article) is realising how much data you already hold on a customer and how much you already know about the customer. The question it seems is how you can use it to generate value for the customer and your organisation. [Live Webinar - Energy Retailing Solution - How to Use Digital Engagement to Unlock Customer Satisfaction and Growth]