How well do you really understand your customers?

All businesses strive to satisfy their customers. But how does a business generate great satisfaction when customers expect to receive quality service or product, and notice only when it is not provided? Let’s take two industries recently discussed in J.D. Power reports: Airlines and Utilities. Dare to guess which one has a consistently higher customer satisfaction rating? Before you read ahead, think about your recent experiences with each.

Not too long ago I lost my checked luggage for three days, and this experience made me appreciate the value of a non-eventful travel experience. As for my utility, since I’m on autopay I don’t have much of an opinion of them, except when the power goes out. According to the Edison Electric Institute, electricity uptime is 99.99 percent. Compare that to on-time arrivals for airlines which hover at 75 percent. Should a utility’s A+ record receive A+ satisfaction ratings? According to J.D. Power’s 2016 Electric Utility Residential Customer Satisfaction Study, the answer is “no”. Utility customer satisfaction consistently ranks well below other industries that are generally perceived as having loathsome customer experiences, like airlines. What can we learn from this?

Airlines have worked very hard to understand their customers’ needs over the years. For example, Delta learned that customers value a seat at the front of the plane, free drinks, early boarding, and extra legroom, which led to the launch of its comfort+ seating program. Delta has increased their customer satisfaction by offering services that their customers want and interestingly enough, pay more to receive.

Utilities are starting to follow suit. J.D. Power’s 2016 Utility Products and Services Study concluded that value-added services offered by utilities can impact a customer’s perception of that utility:

  • Awareness and participation in utility products and services leads to a sizeable boost in satisfaction. In fact, one-third of the customer satisfaction score can be influenced by having effective efficiency offerings that help customers manage their energy use.
  • Utility services are very important to business customers, and their satisfaction is nearly 15 percent higher than those that don’t participate. Business customers are more likely than residential customers to participate in energy efficiency programs, if the programs offer specific value and the experience is superior. A poor experience in a utility program yields a lower satisfaction score than if the customer had not participated at all.

In a news release, John Hazen, senior director of the utility practice at J.D. Power, said, “The lesson that utilities can learn from other high-performing service providers is that to excel you need a culture that puts customers and employees first. And because customer expectations continue to increase, you need to have a mindset of continuous improvement to keep up.”

Since managing energy costs is such a large contributor to J.D. Power ratings, practitioners of energy efficiency programs are critical partners. Utilities who envision their energy efficiency programs as value-added services, rather than as compliance obligations, may see increases in customer satisfaction across their entire brand. Furthermore, since business customers participate more than residential customers, the first place to improve may be within their business offerings.

#EEDay2016

By | 2017-03-30T20:52:36+00:00 October 5th, 2016|Blog|0 Comments

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