In the UK over the last few weeks the energy market has had more media coverage than usual. Whilst I don’t plan to unpack all those details and the reasons for the elevated levels of attention, it does create an opportunity to restart the discussion around differentiation in what is essentially in the customer’s view, a commodity based market.
If nothing else changes it does seem likely we’re witnessing the end of the ultra-competitive, some might say aggressive pricing we’ve seen across the domestic market particularly. The question is are we entering a new era or just more of the same once volatility reduces and the market calms?
In the age of hyper digitisation, the customer experience of energy suppliers is hugely skewed towards switching websites and then the supplier’s own website/My Account offering. If price differentiation is going to become less prevalent then how as an energy retailer can you look to acquire and keep customers in the long term. This is important for two reasons; firstly, longer-term customers are typically more profitable and secondly by creating a ‘relationship’ you can position yourself to offer other services.
Perhaps then one possible route, is that being followed by some online only banks. Through their app they allow their customers to join a partner energy supplier. Whilst I can’t comment on their level of success it feels likely that the next wave of new entrant energy retailers won’t be ‘pure play’ energy suppliers. More likely it will be brands in adjacent markets looking to add more services to their customers home’s.
The opportunity therefore exists for energy suppliers to elevate their digital offering, engage their customers, and look to provide a range of other revenue generating offerings. In simple terms get the basics right, engage your customers at the right time for them, and transact efficiently.
As we move into a world where domestic and SME suppliers are less able to win just on price, how you engage digitally will be the true route to customer success.