Guidelines for a Competitive Retailer: How to Win Customers’ Hearts
The energy industry is facing a future where their customers expect a seamless customer experience across all channels. And they want relevant information personalised for them. A company is no longer compared only with its competitors, but also with the best customer experiences.
In a competitive environment where companies are looking to win customers’ hearts by creating seamless customer experience, how does this affect traditional energy retailers?
The Retail Game is Changing
New players are using their high-efficiency, lean processes and low-cost structures to offer cheaper electricity prices and bundled products and services. In the future, distributed generation and new digital technologies will give utility customers the freedom to interact with a choice of competitive energy platforms that enable the exchange of energy and a range of additional services.
The growing importance of customer centricity and the fact that consumers expect a more seamless user experience, are reflected in the flurry of recent strategic moves by leading companies across the world. “Smart Home” technologies from various vendors are taking over the scene, represented by phenomena such as distributed energy resources, IoT, electric vehicles, social media interaction, different kinds of heating and diverse consumer lifestyles.
The old retail model with one-size-fits-all solutions simply does not apply anymore.
To succeed as digital energy retailers, companies should look to:
Improve customer growth
All companies dream of attracting more loyal customers, while cutting costs at the same time. Digital channels provide companies with 1) Pipelines that cost far less than traditional sales methods and 2) Tools for making sure that marketing and sales efforts connect with your preferred audience.
Using billing as a strategic enabler
A survey by Quindi[i] found that energy retailers firmly endorse the view that their billing and customer care solutions are key enablers for their business strategies, with 70% of respondents agreeing. Billing accuracy is the most valued business benefit of these solutions, as identified by 95% of survey respondents. This finding reflects the fundamental importance of getting the billing right the first time to maintain customer satisfaction.
Hansen’s guidelines for a competitive retailer
Our guideline approach comes from working with leading retailers worldwide.
Step 1: Identify your ‘Why’!
Do you want to stand your ground or to evolve into the new era of the energy market? Retailers must look at new business and earnings opportunities, understand how to monetise them in the face of strong competition from outside the industry, and define the role they will play in this future world.
The transition to carbon-neutral and distributed energy generation triggers a need for flexible power generation, demand response, energy storage and new service models.
Step 2: Implement next-generation innovation capability.
To unlock the potential of a customer-centric and data-driven business, companies look for an operational model where service and product innovation become the DNA for customer experience.
Step 3: Introduce cloud-based computing.
The business rationale is to increase the flexibility and scalability of IT infrastructure and to leverage new technologies where there is a rising need for personalisation, scalability, automation and real time processes.
Step 4: Create a diversified, scalable data analytics ecosystem.
Analytics is more than reporting. You can reveal anomalies, outliers, new trends, cause-and-effect relationships and much more by combining different sources of data. Retailers need to use open architecture in order to collect, store, process, and present customer-related data and other types of information to leverage data effectively.
Step 5: Work with IT vendors that understand how to grow your business.
Do not try to invent core systems yourself. Take part in the shared economy model. Your creativity and data utilisation are what makes you unique.
Let’s talk about your way to success!
“Guidelines for a Competitive Retailer” is a brief extract from our Energy Transition Papers – Future of Retail where we further explore Retailers’ role in the ongoing energy transition and how together we can address ways to win the new energy customer.
[i] Quindi Research, “New Directions in Energy Retail: Billing & CIS for Competitive Edge”, https://quindiresearch.com/analyst-report-new-directions-in-energy-retail-billing-cis-for-competitive-edge, accessed September 2019
By Stian Madsen who focuses on guiding utility companies through the ongoing industry transformation, where delivering a personalised energy experience to energy consumers is a key factor.