Utility Week

UTILITY WEEK | 2ND - 8TH FEBRUARY 2018 | 27 Customers Market view A long with other regulated industries, the utilities sector has specific obli- gations where customer communica- tions are concerned. As well as needing to be transparent, straightforward and clear, util- ity suppliers are duty bound to communicate with their customers on an ongoing basis – in our experience they are continually issu- ing statements, bills, contract letters and operational information. Energy suppliers also have to prove to Ofgem that they have engaged with customers about their energy use and the cost benefits of switching tariffs. This is a huge undertaking – Opus Trust Marketing alone sends out more than 60 mil- lion communications every year for energy companies, as well as 18 million communi- cations on behalf of water companies. While Ofgem is currently consulting on streamlining customer communications, the sector's obligations are not about to go away any time soon. And with energy suppli- ers facing fines if they do not communicate correctly, they cannot afford to get it wrong. Furthermore, providing high quality commu- nications in a timely manner has an effect on customer service, making them an important part of the water industry's service incentive mechanism scores and PR19. Of course, the rise of digital technology means there are a variety of new channels that can be used to communicate. Along- side traditional mail, consumers are likely to receive emails and text messages from utilities providers and are, in most cases, provided with secure online accounts. So, as you would expect, our business has seen an upli in electronic communications, with print reducing by about 5 per cent each year across the board. However, while today's consumers might be inherently digitally savvy, this doesn't mean digital channels are always the best way to communicate with them. Indeed, the majority of our customers still see real value in post. In fact, a Royal Mail report suggests that if a message is important or sensitive, and you want to be sure the customer will open, read, trust and engage with it, then mail is almost certainly the right way to deliver it. Royal Mail's research revealed that 87 per cent of consumers rate messages delivered by mail as believable, compared with 48 per cent for email, and 65 per cent feel confident the contents of their mail remain private. It also showed that 72 per cent of people oen read and review some of their mail at a time when they can give it their full atten- tion. Furthermore, when people are sent sensitive or confidential account infor- mation, 51 per cent prefer to be contacted by mail, compared with 35 per cent by email, with the remainder preferring to hear by phone (12 per cent) or text (1 per cent). In addition, bills and statements stay in the home for an average of 45 days, providing multiple opportunities for people to reread them, and engage with them more deeply. The report also refers to an IPA Touch- Points survey, which shows that mail drives a range of commercially relevant responses, including enquiries, purchases and service renewals. All of these actions have seen an upward trend in the past year. We would therefore advise that commu- nications requiring a high level of customer engagement or that have an important call to action – such as welcome packs, statements, bills and contract and operational informa- tion – will have greater impact if they are printed and posted to the recipient. New digital channels are still important, but they should be used to supplement, rather than replace, physical mail – and this approach can be really valuable in terms of improving engagement. Any move to digital channels needs to be about enhancing customer service – and the customer must perceive it as being beneficial. Businesses generally move to digital commu- nications to reduce operational costs – and the customer will realise this. Therefore, they need to see the value and feel their service has been upgraded, otherwise any cost sav- ings achieved will not be sustainable. Most of our clients are investing in a mix- ture of traditional post and electronic solu- tions, depending on the message and the customer group. Of course, specific customer requirements need to be considered too – for example, generally speaking, elderly people are probably less likely to want to receive digital messages. How vulnerable custom- ers are communicated with also needs to be a big consideration – Ofgem has a prior- ity service register, and Ofwat has recently announced it is going to report on how water companies serve, support and protect cus- tomers in vulnerable circumstances. A communications strategy should be focused on contacting the right customer, at the right time and via the right chan- nel. While today's new technology is mak- ing communications easier and cheaper, it is important to use a channel that suits customer preferences, and is most likely to achieve engagement and the desired outcome. Mark Hetem, sales director, Opus Trust Marketing Make communications count With so many channels available to communicate with customers, how do you ensure your strategy will achieve engagement and the desired outcome? Mark Hetem offers some advice. Key points Utilities have regulatory obligations, as well as commercial considerations, when it comes to customer communications. There are now a variety of different com- munications channels, including mail, email and text message. For important communications, post can be the most appropriate channel. Digital channels of communication should be used to supplement rather than replace existing channels. Different channels can be tailored to dif- ferent customer segments. "If a message is important and you want to be sure the customer will open, read and engage, then mail is the way to go."

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