Utility Week

UTILITY WEEK | SEPTEMBER 2022 | 25 Customers "It is all about accommodating custom- ers' personal preferences and situation," says Anglian Water's director of customer and wholesale services, Pete Holland. "How- ever, currently, we have quite a few legacy- type systems. That is going to change over the next year or so, but right now our abil- ity to tailor a journey end to end is one of our biggest challenges. We can't fully tailor an experience for each individual customer, because we have not got that capability in the back end." There are similar blockers currently shap- ing energy companies' approach to personal- ised customer billing, whether dealing with domestic or business customers. According to one energy executive, the biggest billing issue their organisation is currently facing is ensuring customers are aware of and understand the options avail- able to-them. "There are online o€ erings there, but cus- tomers don't really use them as much as we would like. We are still trying to point peo- ple to the right journey, which means our call centres are backlogged," they explain. "We are not getting every bill out on time – a lot of our systems are manual, so there is an added risk of human error. "Overall, I think we actually perform well across the billing journey. But it is just that small 2% that causes a lot of hassle that we need to work on. We are in the process of rolling out a new system, so that will really help us to move with the times." Evolving customer requirements If customer experience is central to bill- ing, then ‡ exibility and choice is equally as important when it comes to payment methods. The sector is currently dominated by direct debit and web card payments, with water companies tending to place higher importance on a broader range of payment methods. The use of cash and cheque pay- ments continue to fall – just 13% of utilities consider them to be an extremely important payment method. Looking ahead over the next ‹ ve years, direct debit payments will continue to domi- nate but card payments via mobile apps are predicted to be as important as card pay- ments via websites. The impact of Covid-19 has also triggered signi‹ cant changes in customers' payment preferences, with many utilities seeing a shi' away from cash payments over the past few years. Following the impact of the pandemic, the cost of living crisis is also now ‹ rmly at the forefront of many customers' minds. Mark Wilkinson, head of income at North- umbrian Water, says it can be tricky to pre- dict how a customer wants to interact with their utility supplier, because their prefer- ences are o' en in ‡ ux and dependent on personal circumstances. Northumbrian is currently investing in its app and web o€ ering and adding in trans- action solutions that allow customers to self-serve. "Flexible payment arrangements is an area that we have been exploring because there is potential to do a lot more. However, it is about trying to get the right balance between the customer self-managing and paying based on their own circumstances, versus customers just opting out of paying. "Especially where people are afraid to come forward and say they are struggling to pay, this can give us a trigger, a little bit of information that we can work on to try to engage with the customer and o€ er the right support." Tackling the data challenge Despite acknowledging the bene‹ ts and future opportunities that customer data can unlock, our survey found that it remains one of the biggest process challenges for utilities. Generating valuable data to inform busi- ness activities was ‡ agged by 52.2% as the most signi‹ cant challenge. Interestingly, 47.8% also identi‹ ed interrelated challenges around o€ ering customer ‡ exibility and inte- grating new technologies, as well as estab- lishing early warning systems for identifying and supporting vulnerable customers. Southern Water's a€ ordability and vul- nerability lead, Rachel Ryan-Crisp, says the main challenge for the business is identify- ing those who are already struggling to pay and those who are on the verge of ‹ nancial diŸ culty so that help and support can be o€ ered to them. She adds: "It is quite surprising that no matter what we do in promotional terms, many customers are not aware that their water company can actually help them ‹ nancially with their water bills. The key is identifying vulnerable customers early." Sharing data and information across utilities and other stakeholders could pro- vide an opportunity to ‡ ag early indicators of potential payment diŸ culties. However, EDF Energy's back oŸ ce, asset management and revenue operations director, Christopher Dalley, worries that current data regulations can be a mine‹ eld for utilities, which are understandably cautious about what infor- mation they can and can't share. "Obviously, the Data Protection Act was put in place for the right reasons. But equally, if there was a way that we could exchange customer data in a safe and secure way, then we could de‹ nitely be more at the forefront of trying to put solutions in place as a wider utilities industry," he says. "Do we engage with other utilities across a range of di€ erent forums? Absolutely. But do we collate our information and try to look at solutions as an industry? No, the industry is not there yet." With disparities across the sector in terms of the eŸ cacy of di€ erent data strategies and major regulatory barriers to overcome, there is work to be done to ensure that all utilities are taking a more joined-up approach. Further insight into the survey results, including the appetite for innovation in payments and the opportunities to better support customers, particularly those with vulnerabilities, through the billing and pay- ment journey will be explored in the second instalment of this report, which will be pub- lished in autumn 2022. Nadine Buddoo, intelligence editor in association with In association with A Utility Week research report in association with Mastercard July 2022 How well do you know your customers? Billing and payments Download the report Download the report Bill and Payments: How Well Do You Know Your Customers? free at: https://utilityweek. co.uk/billing-and-payments-how-well-do-you-know-your- customers/ "Flexible payment arrangements is an area that we have been exploring because there is potential to do a lot more. Mark Wilkinson, head of income at Northumbrian Water "Flexible payment arrangements is an area that we have been exploring because there is potential to do a lot more. , head of income at Northumbrian Water

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