Are Customers Interested in their Utility Bill?Published: 24/08/15
A report by the Energy and Climate Change Committee (ECCC) suggests a significant number of customers do not look at their energy bill, or even open the envelope in which it is delivered! In this blog post Jendev explores some of the reasons why this might be the case.
Payment Methods are a Factor
According to Consumer Focus, customer attitudes towards utility bills differ depending on how the customer pays. There are a number of reasons why this might be the case:
- Paying by direct debit results in payments being automatically taken from a customer’s bank account on a regular basis. The level of customer interaction is reduced which may result in lower bill interaction levels. In essence this could be a case of ‘out of sight, out of mind’.
- Customers paying by cash / cheque need to be aware of the amount they owe in order to complete the transaction. Therefore by default a reasonably high level of engagement with their utility bill is required. Research by Ffrees Finance, shows that there are 3 million people in the United Kingdom who do not have a bank account, a significant number.
- The use of standing orders also requires customers to engage with their utility bill to ensure that the amount set is sufficient, albeit there is likely to be lower engagement levels than customers paying by cash / cheque.
Utility bills will have a greater level of importance and therefore engagement for customers on a low income for whom paying for utilities takes up a reasonably large proportion of disposable income.
A recent report by ‘My Customer’, a community of customer-focused professionals, suggested that energy is a low engagement product. If customers find energy uninteresting then there is likely to be reduced motivation to consume less. Typically, reviewing and acting upon utility bill information should only take up a small amount of time. As Mike Ballard from Oracle stated, “Customers feel that they shouldn’t have to get too involved in the process”. However Ballard went further by stating that,
“Customers who are interested in lowering their energy bills and managing their energy usage have to be engaged in the process”.
Therefore engagement levels in utility bill information will need to increase if customers want to find ways to make savings. This is a topic which is strongly related to smart metering and customer portal technology which in part seek to aid customer understanding of consumption data.
Confusion Surrounding Bill Content?
UK research carried out by Uswitch, showed that 86% of the 1,020 individuals surveyed, complained that their bills were too confusing. A damning indictment of current utility bill design. The main comments from the study showed that the bills were seen as being too complicated, using too many jargon words and including information which is difficult to locate. Therefore it is recommended that bills should be simple and easy to read with key data being highlighted (for all customer groups).
It is possible that with the advent of smart meters and customer portals it may become less confusing for customers to understand consumption and costs. However with the full implementation of this technology some way away in many countries, issues surrounding traditional utility bill design should be addressed in the short term to help improve the quality of customer interactions.
Key Points to Consider
- The payment method chosen and level of income will shape the level of customer engagement in utility bills.
- Clarity is King; customers need to be able to understand their bill in order to be fully engaged with it.
- Utility companies can create attractive and easy to understand energy bills to ensure customers fully understand. To deliver increased customer satisfaction with the billing process, improvements in bill design are clearly needed.