Utilities brands once got away with marketing that was, well, utilitarian. No longer, says Landor’s Andrew Welch for The Drum’s finance & utilities focus. ‘What’ is done. It’s how-time.
If the definition of utility is ‘the state of being useful’ then, arguably, utility companies are delivering on only half the definition. While the supply of water, gas, electricity, internet and so on is, of course, useful – indeed essential – the way those utilities are being supplied appears be evading that definition.
In this highly regulated, complex, price-led category, supplying the ‘what’ (the service) is no longer enough; the ‘how’ (the experience) has become increasingly important in the quest to prioritize customer needs and build a brand experience that delivers business advantage.
For too long, utilities have operated on a supply-side only mentality, sweating an infrastructure built in the analogue era while assisted by decade’s old software.
Take energy utilities, for example: for over 150 years, transacting supply was all that was needed. But with the inevitable transition from fossils to renewables, this $2tn sector is destined for more disruption over the next 10 years than in the previous 100.
But for those utility brands seeking to build better relationships with customers and differentiate thoughtfully, this shift represents a significant opportunity.
Powered by AI
Explore frequently asked questions
The ‘how shift’
This shift will demand a tech-forward approach that shakes up old market practices.
Take Octopus Energy’s energy tech platform, Kraken. Now the UK’s second-largest domestic energy provider with over 5 million customers, Octopus provides a platform that helps drive adoption of renewable energy technologies that significantly reduce CO2 emissions, giving rise to a cheaper, cleaner energy system.
The platform became so disruptive and successful that Kraken is now deployed by rival suppliers, and worth billions in its own right. The introduction of smart tech will lead to improved efficiency, demand-side management and, importantly, personalized customer services that resonate deeply and establish brand loyalty. In the battle for a better utility experience, tech will be the catalytic ‘how’.
This shift will also encourage greater empathy and challenge other brands in this space to truly understand their customers’ needs. Greg Jackson, chief executive of Octopus Energy attributes his company’s meteoric rise to “talking to customers one-to-one, winning them over one at a time, like hand-to-hand combat.”
Getting back to the big idea
From this customer understanding, a new idea-focused mindset is rising in utilities – one that obsesses over customer welfare. When was the last time you heard the word ‘idea’ and ‘utilities’ in the same sentence? From Octopus Energy’s innovative payment assistance programs for customers facing financial difficulties to its electric blanket scheme providing 40,000 free electric blankets for vulnerable and elderly customers during the energy crisis, new ways of thinking and possibilities are coming from the very heart of the business. Greg Jackson, again, said, “Ideas come when you get involved in the business, when you get your hands dirty – not on Away Days or an innovation session. You can’t think of ideas on demand – not good ones”.
Likewise, Vattenfall, one of Europe’s largest producers and retailers of electricity and heat, recognized the urgent need to empower its customers with personalized insights into their energy consumption. The brand launched a live data product that provided tailored metrics and actionable tips based on each customer’s unique living situation, needs and budget, guiding customers toward more sustainable energy practices. In this typically transactional sector, the flow of customer-centric ideas is set to elevate the ‘how’ and build more useful and meaningful experiences with customers.
Growing ‘the how’
This how-mindset can’t stop there. Instead, we need to maintain a relentless focus on introducing a positive brand experience at every touchpoint by way of proactive communications, clearer billing, avoiding jargon, transparent pricing, tailored tariffs, personalized saving advice, real-time insights into usage, predicting future demand and deploying responsible and ethical business practices.
Those are just some of the ‘hows’ at the sector’s disposal to shift from the old supply-side mentality to the new customer-on-your-side mentality.
Where price and reliability of supply were once the overriding determinants of choice, the utility sector now has at its disposal a whole range of new and innovative ways to be genuinely useful to customers – and beyond, to the planet itself. Those who integrate these ‘hows’ thoughtfully in the customer experience will win in the battle for preference and sustained business success.
Read more finance and utilities wisdom over at our dedicated focus week hub.