Understanding dissatisfied customers

A telephone survey by Power Perceptions, based in Colorado, USA, of 2068 residential household decision-makers throws some light on how customers feel about the service they are getting from their electric utility.

HOW SATISFIED ARE YOU WITH YOUR CURRENT ELECTRIC SERVICE?

This graph shows that utilities have much to be proud of – 65% of customers show high levels of satisfaction with the service they are receiving. (And it's also interesting to note, after the Californian débâcle, that deregulation is alive and well in Pennsylvania, the other state where the process is far advanced. 31% of Pennsylvanians were “completely satisfied” with their service provider, compared to the national average of 24%).

Levels Of Customer Satisfaction

But what about the other 35%? Why are they dissatisfied? And will this dissatisfaction lead them to switch suppliers?

SHOPPING INTENTIONS

It seems obvious to say that satisfied consumers are less likely to change their supplier, and the survey proves this to be the case, with those who are less satisfied being more than twice as likely to change as those who were completely satisfied. However, those utilities hoping to persuade dissatisfied customers to change would do well to note the 32% of them who would rarely shop for an alternative electricity supplier. Strategies need to be developed which would make the search for information easier, and the relative ease of the switching process should be effectively communicated.

Figure 3

An important finding was that consumers without a choice of supplier (in other words, consumers from states which have not yet started the deregulation process) were much more optimistic about the benefits of being able to change supplier, and much more likely to change when the opportunity is made available to them. It seems that consumer experience with electricity choice has dampened expectations somewhat. 

REASONS FOR CONSUMER DISSATISFACTION

Respondents were asked to agree or disagree with positive statements made about their electricity supply, such as: “Your electricity service is reliable” or: “You are satisfied with your current billing options”. Unsurprisingly the least satisfied were less likely to agree with the statements. The largest areas of disagreement were customer service, billing options, price and the reputation of the provider. However, all respondent

Reasons For Customer Dissatisfaction

s disagreed with the statement that: “Your company uses electricity generated from an environment-friendly source.”

CUSTOMER VALUES

One explanation for differences in the levels of customer satisfaction could be differences in customer values. Respondents were asked to rate certain value statements in terms of importance as they perceived it, using a 1-10 scale. Statements included: “Incentives which reward usage, such as frequent flyer miles or shopping credits”; “An easily understandable electricity bill”; and “Overall price”. It is interesting to see from the survey that values do not vary significantly according to levels of satisfaction or dissatisfaction, which leads to the assumption that differing satisfaction levels are the result of an individual's experience in the dealings he has with his service provider.

Customer Values

WHAT DO CUSTOMERS WANT?

Attracting and retaining customers is made easier if utilities know something about customer expectations. Respondents were asked to rate their levels of interest in a variety of offerings, such as: “Charging different electricity prices depending on the time of day”; and “Being able to find out how much electricity you have used by checking on the Internet or telephone”.

Customer Interest

The least satisfied customers were more interested in all the services and options offered except for bundling telephone and cable television services. And many of them favoured time-of-use tariffs and being able to enter into a one-year contract with one utility if they were offered a lower price for the electricity they used during the year.

Many utilities today operate sophisticated customer call centres, where they are able to track problems and complaints, identifying trends if they exist and establishing customer requirements.

The data available from these call centres, and from surveys such as the one described above, can be of considerable assistance in identifying the package of price and services most likely to attract – and retain – customers.