Putting customers first: how can energy companies provide better customer service?
Citizens Advice’s latest energy complaints league table has noted the widest gap between the top and the bottom of the rankings when it comes to dealing with customer complaints, with the lowest-ranked company, Extra Energy, performing 80 times worse than SSE at the top of the league. The gap may be widening but the problem is nothing new. Energy companies are routinely criticised for their handling of customer complaints, so why are they getting it wrong and how can they do better? The Institute of Customer Service and Citizens Advice provide some insight.
Citizens Advice’s quarterly review ranking the customer service performance of energy companies shows customers how well energy suppliers are dealing with complaints. Consumer watchdog Which? also compiles a similar annual report.
The need for such scrutiny on this aspect of energy supplier’s performance spawns from a long history of patchy customer service which, in the past, has been exacerbated by a lack of competition in the market.
As smaller energy companies start to erode the monopoly away from the Big Six suppliers – British Gas, EDF Energy, npower, E.ON UK, Scottish Power and SSE – customer service performance has shown some signs of improvement. However, as Citizens Advice’s research shows, there is still a long way to go.
Heidi Vella: Do energy companies have a customer service problem?
Jo Causon, chief executive of the Institute for Customer Service: The latest UK Customer Satisfaction Index (UKCSI) results gave the UK’s utilities industry an overall customer satisfaction rating of 73.3 out of 100 – 1.9 points higher than its July 2015 score.
This remains below the UK average, but closes the gap from 4.8 points a year ago to 4.1 points.
It’s encouraging to see the sector making progress, but prevention is always better than cure, so the industry should take note of the areas which need to be focused on.
HV: Is it easier for big companies to manage customer service compared with the smaller companies?
JC: Customer service excellence is not determined by a company’s size; it’s about the level of commitment to improving service standards and customer satisfaction. The gap we’re seeing between organisations reflects those who are fully engaged with their customer service journey and those who are yet to start; those whose boardrooms understand that a focus on customer service impacts the bottom line and those who are yet to catch up.
Gillian Guy, chief executive of Citizens Advice: Our latest league table shows the gap between how well the best and worst performing energy suppliers handle customer complaints is at its widest on record.
It also reveals a lot of fluctuation in the performance of both large and small energy suppliers - with some improving significantly, but others getting worse - showing that size is no excuse for poor customer service.
HV: Why should companies invest in customer service?
JC: Customer service is a key differentiator. Investing in a robust customer service strategy not only improves levels of satisfaction in your customer base; it also tangibly impacts the bottom line.
There is also a proven relationship between improving customer service and trust. The relationship between the highest levels of customer satisfaction and trust has strengthened in the past year, with 96% of customers who rate an organisation nine or ten out of ten for customer satisfaction also citing the highest levels of trust. Trust in a company leads to loyalty and recommendation – key factors in sustaining and expanding market share, as well as protection of reputation.
GG: It’s in the interest of all energy firms to make sure they are delivering a consistently high standard for their customers. Dealing with customer complaints efficiently will save firms time and money, build trust with consumers and create a truly competitive market.
HV: What can companies do to improve customer service?
JC: ‘Getting it right first time’ has to be a prerequisite for any organisation. Customers expect to be dealt with quickly and competently – as soon as they start to feel let down or ignored, their trust is lost. Efficiency, effectiveness and empathy are key, and organisations should always follow up with customers to ensure that the problem is resolved.
Customer service best practice – the level of service which we see consistently delivered by our top scoring organisations – means getting it right first time, handling complaints well, ensuring that employees are helpful and competent.
GG: We want to see energy firms investing in support staff and systems that will ensure complaints can be handled quickly and efficiently.
HV: Has a focus on more competition in the energy sector changed the way companies have focused on their customer service?
JC: Any initiative that drives choice, value and organisations working harder for their customers has to be welcomed. What’s more important is understanding what it is that your customers want and how their priorities are, or should be, driving your customer service strategy.
We know that in the banking sector, banks with higher levels of customer satisfaction attract more customers to their accounts, and those with lower than average satisfaction lose customers.
HV: What are the biggest complaints and bugbears consumers report in regards to interaction with their energy providers?
JC: We recently asked consumers about their biggest customer service bugbears, across all sectors. The most popular responses included employees lacking the capability to be of immediate help (56%), ‘disinterested’ staff (51%), poor complaint handling (35%), and ‘unhelpful’ attitudes (36%).
GG: Bad service affects people in many ways - from the financial stress of being hit with a late bill, to the time wasted trying to get hold of a supplier on the phone.
HV: Are customer service performance rankings, such as those by Citizens Advice and Which?, useful to energy companies?
JC: Looking at how your organisation ranks against others in your sector, as well as high achievers in other sectors, is undoubtedly a valuable exercise.Ultimately, however, it’s an ability to turn this insight into positive action that will make the difference. No two organisations are the same – it’s about being able to get under the skin of your organisation and explore what suits your unique challenges, using best practice and data to inspire change.