It’s All About Attracting and Retaining Smarter Retail Energy Customers

A “Smarter” Billing and CX Platform Can Make the Difference

According to industry research, 70% of energy retailers agree that their billing and CIS solutions are key enablers for their business strategies. And at the core of any retail energy suppliers’ strategies, is finding a way to grow their customer base more efficiently, and at less cost.

Retail energy billing isn’t what it used to be. Given the growth of smart meter technology and the ever growing dependence on smart phones, tablets and other web-enabled devices, there are myriad ways for retail energy suppliers to engage with “smarter” consumers.

As we are seeing, smart meter technology is quickly becoming the norm for consumers. 47 percent of households had smart meters as of 2016, up from just 33 percent in mid-2012.[1] As more markets deregulate, and as smart meters become even more common in households nationwide, a greater number of customers will have the potential to leverage smart-enabled options for monitoring, controlling, and paying for their energy use.

At the same time, customers are becoming harder to hold. 38 percent of retail suppliers say their biggest challenge is improving customer acquisition and retention. As just one example, 960,000 Texas energy consumers swapped providers in 2013 alone.[2] And, even in regulated markets, consumers (and taxpayers) have likewise raised expectations for their utilities.

Improving billing and consumer engagement flexibility is one of the best ways to captivate and satisfy these consumers. On average, the modern consumer uses three different payment methods per month, including online, mobile, and walk-in bill pay by check, cash, credit, and money order. What’s more, 43 percent of consumers said that having multiple payment options improves satisfaction with their biller.[3] For retail energy providers, we believe the following strategies will help to improve the process of finding, and keeping, great customers by making better use of smart meter and smart communication technologies.

Begin with an Amazing First Impression

The process of onboarding a new customer is the initial, and crucial, first step towards ongoing customer success. This truly IS their first impression of you as a service provider! It is also one of the most difficult aspects of a business, in terms of scalability, so why not offer new customers the option to self-enroll, without the need for your customer service team to interact?

We all know that first impressions are lasting, and retail energy suppliers who understand this will have a distinct advantage. The enrollment process establishes the future direction of your customer success strategy, so why not take full advantage of this by offering multiple options for customers to tailor their journey with you. More automation. More choices. More transparency. If they see this during the enrollment process, then they know it will only get better once they’re a tenured customer!

 Promote Time-of-Use Billing as a Differentiator

True time-of-use (TOU) billing is a breakthrough made possible by the combination of smart meters and electronic billing systems. With the ability to pinpoint when and how much energy households are using hourly, or subhourly, utilities can charge different rates that fluctuate around peak times. With the right billing and customer engagement system, customers can likewise monitor their daily energy use and adjust accordingly to lower their bills – without sacrificing comfort. For example:

1. Free Nights & Weekends – TOU pricing opens up numerous options for the retail energy business, including free nights and weekends as just on example. Others include discounted holidays and/or special rates that coincide with energy price fluctuations. Ultimately this contributes to decreased energy use during peak times and that is good for everyone.
2. Let Customers Select Their Billing Frequency – By using interval data you can bill your customers at whatever frequency or interval they so choose. You are not limited to the billing cycle. So if a customer wants to be billed on the 1st and 15th of every month, you can offer this.

Use Promotions to Entice Loyalty

Create rates/products that have built-in promotions, credits and rewards. These can include flat credits, set up as some percentage of an energy charge or bill, or event-driven credits, based on some amount of energy used over a period of time.

Younger consumers will be most attracted to smaller, and more tailored rewards, as opposed to longer-term loyalty programs that takes too long to earn rewards, and worse, too long to sign up for. According to Kobie Marketing’s Loyalty in the Age of the Connected Consumer report, “34 percent of Millennials won’t join if the enrollment process for a loyalty program is too long, and they also expect to see results quickly. As such, it behooves marketers to offer smaller rewards — or customized redemptions — in order to keep younger consumers coming back.”.[4]

Prepay in Addition to Post-Paid

Traditional post-paid billing is the norm, and it works very well for the majority of your customers. And with interval billing capabilities, retail suppliers have many options for offering creative rates. But there are certain customers where post-paid billing may not be the best option, or at the very least, it creates a revenue collection risk.

A more efficient option for these customers is prepay billing, which allows you to not only keep risky customers longer, but to provide a viable option for those customers who might ordinarily get turned away because of their credit score. Prepay is an excellent way to provide them with flexibility, affordability and transparency.

And it isn’t just for high-risk customers, either. Given the ubiquity of mobile devices and prepaid credit cards, any customer will find prepay to be convenient and affordable! Prepay also eliminates the need for most extra fees. Security deposits are no longer necessary, even with the highest-risk customers, since they can pay only for the energy they’re about to use.

Offer Multiple Payment Formats

Prepay and TOU rating are excellent options, but for today’s energy consumer, they’re not enough. People have become accustomed to communicating with service providers through multiple touchpoints, and most companies offer online, mobile and in-person billing.

Energy companies shouldn’t be any different. Here are some more statistics. 67 percent of consumers who use digital channels are satisfied with their energy providers, compared to 58 percent of consumers whose providers don’t engage online. Further, retail energy suppliers can lower controllable customer support costs by up to 30 percent by adding low-touch sales and support channels.[5] For example, payment options should include:

• Mobile-optimized online web portals
• Consumer friendly mobile payment apps like Venmo
• Online card payments and ACH transfers
• Interactive voice response (IVR)
• Walkup cash
• Credit card kiosks
• Traditional phone payments

Offering all of these options allows retail energy providers to serve a variety of demographics, incomes, needs and preferences. With a cloud-based billing solution, retail suppliers and utilities can also leverage existing kiosks, phone systems and other hardware.

An All-in-One Solution

Prepay and post-paid, multiple payment formats and true time-of-use (TOU) pricing – You can offer all of these flexible options and more with a billing system from SmartGridCIS.

• Entice new customers with built-in promotional incentives, and an automated onboarding process.
• Leverage multiple consumer applications and communications channels, including native mobile applications and mobile responsive web applications, to retain customers.
• Stay ahead of the competition by offering creative rate plans and payment options.
• Provide a variety of plans to help customers reduce energy usage and save money.

To learn more about how our solutions can benefit you, please visit us here, or call 1 (866) 678-1110.

[1] https://www.eia.gov/todayinenergy/detail.php?id=34012

[2] Teradata 2016 Global Data-Driven Marketing Survey

[3] Fiserv Seventh Annual Billing Household Survey https://www.fiserv.com/feature/seventh-annual-billing-household-survey.aspx

[4] https://geomarketing.com/heres-what-inspires-millennials-to-join-a-loyalty-program

[5] Accenture, The New Energy Consumer: Architecting for the Future. https://www.accenture.com/t20150523T035714__w__/us-en/_acnmedia/Accenture/Conversion-Assets/DotCom/Documents/Global/PDF/Dualpub3/Accenture-New-Energy-Consumer-Architecting-Future.pdf#zoom=50