Utility Week

Uberflip 17 01 14

Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government

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Page 26 of 31

Customers Market view Getting down to business A healthy debate about customer service is long overdue in the business-to-business market but suppliers need to think beyond the Retail Market Review, says Mark Eccles. T he business to business (B2B) energy sector is long overdue a healthy debate about customer service. The culmination of Ofgem's Retail Market Review has served to highlight the need for a simpler, clearer and fairer energy market. Any customer will tell you that this does not sound like an unreasonable request, yet it is one that the industry has historically failed to meet. Unsurprisingly, the majority of negative headlines have focused on the domestic sector, but customer service is fast becoming the fundamental issue facing commercial suppliers also. Perhaps due to a misguided notion that business customers are only concerned with price, the B2B market has traditionally lagged behind other industries in the delivery of exceptional customer service. It is an issue that is set to come to a head in the medium term. With commodity prices and third party charges forecast to rise across the board – and established suppliers facing increased competition from independent providers entering the market – it is no longer a sound strategy for suppliers to market their services on price alone. Transparency and flexibility are becoming the new benchmarks in the industrial and commercial and SME (small and mediumsized enterprise) energy markets and suppliers, like consumer brands, will soon live or die on the strength of their relationships with customers. Research by Gazprom Energy shows that this is already happening. We recently asked a cross-section of businesses to rank their priorities when choosing an energy contract by assigning points to those they considered important. On average, respondents assigned less than 50 per cent of their points to price, giving slightly more emphasis to a combination of other factors, the most important among which were customer service and accuracy and simplicity of billing. Of course, increased transparency comes with challenges. At Gazprom, we saw this first hand when we introduced transparency around third It also means suppliers doing the legwork party charges. With these costs rising beyond the control of suppliers, we recognised that to ensure customers are aware of, and able it was only a matter of time before suppliers to access, the powerful information that can would have to clearly highlight what these be harnessed by advanced meters. These costs were and, with certain products, pass devices provide the potential for businesses to develop a deeper understanding of their them through to customers. We saw being transparent about this as energy consumption, by accessing more inan opportunity to bring clarity where there depth information on what they are consumhad previously been confusion – based on a ing and when. Suppliers should be actively encouraging the take-up of this techbelief that by clearly separating nology and, crucially, educating busithese charges from the commodnesses in how to access and interpret ity price, businesses would gain the data they provide. a deeper understanding of the At the mid and larger end of the relationship between not only market flexibility is increasingly key. their usage and the cost of their We no longer see products as rigid energy, but also the proportion templates for energy supply, but as of third party charges that are the starting point for a partnership outside of suppliers' control. The tailored to individual needs. Some initial reaction was not entirely customers are demanding this already positive, but any short-term pain In this and more will certainly follow. was worth it to build long-term emerging For these energy buyers, quality trust with our customers. Indeed, it is in the provision market, gas information will mean direct access to the trading floor, giving customers the of this kind of plain English, and power capacity to act on changes in the marhigh quality information that will not be ket directly and in real time. the energy industry can regain a the primary Of course, this way of working reputation for good service. requires sophisticated and malleable In the emerging energy mar- commodity ket, gas and power will not be we as energy systems to price, manage and deliver viewed as the primary commod- suppliers are these new contracts – and accurate invoicing. This investment on the side ity we as energy suppliers are selling of suppliers will equate to the cusselling. It will be information. tomer service the market needs. Quality information, delivered So, while the Retail Market Review is at the right time, via the right channel, is the tackling some (very important) practicalities basis of good customer service. As energy becomes a bigger cost and such as contract roll-overs and broker contherefore a bigger priority for all business it duct, suppliers should be thinking bigger. As the government continues to reconis incumbent on suppliers to play a role in boosting the energy literacy of their custom- figure the energy industry to place more ers. After all, better informed consumers will emphasis on renewables, customers will make more effective procurement and con- increasingly be asked to pay for more than simply the energy they use. The industry has sumption decisions. For the SME market this will be achieved to become more transparent and collaboraby empowering customers with greater self- tive in response. Suppliers have a responsiservice. An internet banking model, where bility to not only treat customers fairly but to customers access the information they need educate, inform and act as responsible parton their own terms, backed by dedicated, ners so as to help customers take control of human account management, is what is their energy consumption and costs. called for. The call centre model of customer Mark Eccles, UK regional director, Gazprom Energy service is no longer appropriate. UTILITY WEEK | 17th - 23rd January 2014 | 27

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