Over the past few weeks, the UK’s energy crisis has been a huge cause of concern for both utility brands and consumers.
With gas and oil prices at all-time highs and coal prices soaring, the increase in wholesale energy prices has put greater pressure on smaller utility brands (those prioritising greener energy and localism) and meant higher energy bills for consumers as costs are passed on.
Soaring prices will undoubtedly see a rise in inflation, ultimately impacting the cost of living for most households in the UK.
To date, ten utilities have collapsed since August, leaving around 1.7 million households open to new suppliers, and energy regulator Ofgem predicts that more will fold this winter.
The regulator has vowed that these households will be protected by energy price caps, yet new suppliers must ensure customer records are accurate in order to establish a trusted and seamless relationship – as well as identifying those customers who are more likely to be vulnerable – from the start.
Securing customer loyalty
When the price cap was increased on October 1, about 15 million households faced a 12% rise in energy bills and a second “significant rise” is expected in the spring.
Utility providers’ communications with their customers have never been more important, as they seek to be as transparent as possible about changes in prices, and this means keeping data clean and up-to-date for marketing communications needs to be timely, informative, and accurate.
An up-to-date database allows utility brands to contact consumers at the correct address with information regarding their personal tariff, utility bills and changes to energy prices. Not only that but up-to-date data gives providers a much better understanding of the way their customers behave.
For utility brands, having accurate customer data will not only improve their marketing strategy but also build trust and loyalty, enabling them to increase their customer base and communicate with transparency.
Identifying vulnerable consumers
Ensuring customer wellbeing must be central to any marketing strategy over the coming months. Lower-income households are going to be impacted further by the latest Government proposals to increase National Insurance payments and end the Universal Credit uplift. Utility brands must prioritise identifying vulnerable consumers and those most likely to struggle with rising costs.
Assessing consumer vulnerability will enable brands to identify the consumers most at risk by helping with debt ratio and detect potential problems for consumers before major issues occur.
It will help them to not only tailor their communications but also home visits and maintenance management to suit consumer needs.
Avoiding costly reputational damage, adhering to best practice guidelines and, ultimately, protecting the consumer’s wellbeing, should be at the centre of every utility brand’s customer relationship as we potentially face another Winter of Discontent.
Phil Ward is account director at REaD Group
