£100m loyalty scheme fails to stem British Gas exodus

british gas new 2British Gas’ £100m investment in its new loyalty scheme appears to be too little, too late after shares in brand owner Centrica went into free fall after it admitted over 823,000 customers had defected to rivals in just four months.
Under the loyalty scheme, dubbed British Gas Rewards, the company offers a range of new tariffs, discounted energy and services, such as boiler servicing and insurance, as well as entertainment packages.
At the time, Centrica chief executive Iain Conn was bullish about the programme’s potential, insisting it would reward the loyalty of customers and give them new offers “that I think they are going to want and like”.
But it seems hundreds of thousands of customers liked it “not a lot” as the company said it lost nearly 6% of its customer accounts between July and October, with 150,000 switching provider after British Gas raised prices in September.
Shares in Centrica, which have already suffered from the looming threat of a government price cap hitting profits, fell by 15.5% to 138p.
The exodus has not dented British Gas’ domination of the market, however, it still has 13.1 million accounts. Even if the merger of Npower and SSE is given the go-ahead, the combined operation will still be second in the market with 11.5 million accounts.
One crumb of comfort is the fact that British Gas appears to have avoided a repetition of the 2015 CRM fiasco, when the business division was rocked by a 95% loss in operating profit during the first half of the year following a botched implementation. At the time, the utility giant blamed issues with the switch to SAP software for significant delays in issuing customer bills.

Related stories
British Gas pledges to pour £100m into loyalty scheme
British Gas hit as 224,000 customers quit for rivals
Vast majority of CRM chiefs admit it is just not working
Energy customer database triggers junk mail fears
Npower faces advertising ban in wake of £26m fine
SSE hit by £10.5m misselling fine
Npower in bid to plug complaints
CRM set-up blunder rocks British Gas
British Gas brings in SAS analytics

Print Friendly

To leave a comment please register – it takes less than a minute and is free of charge. You will also get our weekly email update The DM Report (to opt out contact subscriptions@decisionmarketing.co.uk). If you are an existing user, please log in. If you have forgotten your log-in details please email info@decisionmarketing.co.uk to get them reset!

Existing Users Log In
 Remember Me  
New User Registration
*Required field