How Culture Shapes Utility Brands

Published: Fri 17 Jun 2016
A blog entry by KC Boyce

Contributed by:

KC Boyce
Senior Product Director
Market Strategies International

KC Boyce's Blog

While upside opportunities on operational satisfaction are limited, there’s a significant opportunity to better engage electric and gas utility customers through a focus on brand trust and product experience. Brand trust and product experience compose up to two-thirds (in the US, 60%–63% depending on utility type and region) of a customer’s engagement score with the utility, and both categories score consistently lower than operational satisfaction in the US. These opportunities are clearly at the forefront of how Maik Neubauer, managing director of Shell PrivatEnergie, and Ari Sargent, CEO of Powershop, are thinking about building a successful 21st century utility, based on a webinar discussion I recently participated in with these two global energy experts.

Shell PrivatEnergie and Powershop are retail electric providers in Germany and New Zealand, respectively. Although both of these markets are highly competitive, the conversation provides key insights for utilities looking to strengthen their brand and stay in front of future regulatory and market changes.

Creating a Customer-First Culture at Powershop

Ari shared how critical Powershop has found organizational culture to be in establishing its brand. Every employee at Powershop has a little pink book with three rules that guide the entire organization:

1. “Give a shit”—care about customers and each other

2. “Be awesome”—use your super powers for good

3. “Embrace unique”—welcome diversity

This approach—building a strong organizational culture based on thinking about and creating value holistically for consumers—is critical for pivoting toward a successful 21st century energy brand. Organizational culture is playing out in the Market Strategies Cogent 2016 Most Trusted Brand rankings, where SoCalGas dropped from first to last in Western Natural Gas rankings, indicating a lack of a strong customer-focused organizational culture in how they publicly responded to the Aliso Canyon disaster.

Gaining Trust Using Key Brand Differentiators

According to Maik, Shell PrivatEnergie is focused on service quality and brand reputation because low prices are not enough to sustain an advantage in a competitive market. Shell PrivatEnergie has leveraged the Shell brand and its motorsport heritage to stake a claim on being better and faster than its competitors. Additionally, the company has struck on a unique distribution channel, offering home electric and gas service at Shell service stations across Germany. The company has found this to be successful, and it is a tactic US utilities can use to more effectively reach customers where they are—for example, how Georgia Power has seamlessly integrated its energy-efficient lighting rebates with Home Depot and Walmart stores.

Powershop has staked its position on being brave, bold and unique. Ari states that the utility industry in New Zealand has created an aggregate positioning that “makes smart people feel stupid” and “customers feel powerless.” Powershop set out to differentiate itself by focusing on customer experience and being a strong brand. I encourage you to check out its “Same Power, Different Attitude” campaign, which is designed to set Powershop apart from other providers by empowering rather than berating the customer. This positioning puts Powershop squarely in the customers’ corner and establishes the company as a trusted advisor that can help consumers feel more in control.

The Importance of Product Design

From a product perspective, Market Strategies Cogent's Utility Trusted Brand & Customer Engagement™: Residential report highlights just how important product design is—approximately 70% of a utility’s product experience score is determined by product design. Powershop focuses its product design on giving customers more information, power and flexibility. It used aggregated customer data to develop personas in order to surface more relevant product offers, and found that customers who bought “energy packs” (i.e., prepaid energy) had lower churn. Shell PrivatEnergie’s Neubauer stated that bundled products and services are increasingly critical in the company’s market, and the company has responded by bundling home gas, electricity and vehicle fuel.

These examples show how thinking creatively about how to solve consumers’ problems—that is, to create value for consumers—can yield unique product offerings that allow a utility to stand out in the marketplace. This not only helps drive adoption of those products (in both of the cases above, the product offerings are core to their respective utilities), but also enhances and reinforces the utility brand in a “virtuous cycle.”

If you’re interested in hearing more details about what we’ve found in our Utility Trusted Brand and Customer Engagement study, or how Shell PrivatEnergie or Powershop have approached brand and product, please follow this link to view the webinar (it’s free!).

This is an edited version of a blog post that originally appeared on Market Strategies International's blog under the title “Grabbing the levers of change.”