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So Near Yet so Far
Why Utilities Need to Re-energize Their
Digital Customer Experience
Mind the Gap: How a Digital Divide is Compromising
the Utility Customer Experience
levels in Britain dropped from 78% in
2012 to 55% in 2013. And only 29% of
customers trusted their utility providers
to be open and transparent in 2013,
compared to 34% in 20121. For the EU
as a whole, customers’ trust levels in their
energy suppliers stood at just 45%, and
in North America, at 53% in 20132.

Only 29% of customers
trusted their utility
providers in 2013.

Utilities Face Growing
Customer Dissatisfaction
There is simmering discontent in the
utilities industry. Customers, already
increasingly demanding, are now actively
dissatisfied with their providers. Take the
UK as an example. Customer satisfaction

There is clearly a need to address this
tide of disquiet and re-energize the utility
customer experience. Industry analyst
surveys show that utilities have realized the
need for enhancing customer experience
(see Figure 1). However, the industry’s
best efforts to rebuild confidence and
trust could in fact be undermined by a

growing digital divide, with consumers
demanding a digital experience that the
industry has so far been unable to meet.

Customer satisfaction
levels in the UK dropped
from 78% in 2012 to 55%
in 2013.

Figure 1: Top Business Challenges for Utilities

Top Business Challenges
European Utilities

Top Business Challenges
North American Utilities

Maintain regulatory compliance

Maintain regulatory compliance

Enhance customer experience

Smart metering

Retain customers

Aging infrastructure

Smart networks

Environmental legislation

Environmental legislation

Enhance customer experience

Smart metering

Revenue protection

Revenue protection

Smart networks

Aging infrastructure

Retain customers

Manage an aging workforce

Manage an aging workforce
1.0

1.5

2.0

2.5

3.0

3.5

1.0

Average rating

1.5

2.0

2.5

3.0

3.5

Average rating

Sample size: 111

Sample size: 48

Question: How important are the above business challenges to your organization?

Question: How important are the above business challenges to your organization?

Source: Ovum, “ICT Enterprise Insights in the Utilities Industry”, 2013

2
Nearly 624 million
customers are expected to
engage with utilities via
social media by the end of
2017.

Thwarted Desire: Utilities
Have Not Met their
Customers’ Digital Wants
Utility customers want to go digital.
Platforms such as social media and mobile
apps are rapidly becoming the preferred
means for customers to communicate
with their providers. Research indicates
that over 57 million customers engaged
with utilities via social media in 2011
and that this number is expected to rise
to 624 million by the end of 20173. It is
also estimated that 50% of customers
prefer to use a mobile customer service
application to try and resolve their service
issues before calling the contact center4.
Unfortunately, utilities have not kept pace
with consumers in the shift to digital
channels. Our research with the MIT

Centre for Digital Business shows that
only 40% of utility providers use digital
technologies to enable self-service (see
Figure 2). Less than 30% of utilities
use digital technologies to provide a
consistent experience across channels5.
While utilities have undoubtedly taken
their first steps towards a brighter
digital future, they have a long way to
go. We conducted a detailed study to
understand the digital initiatives being
undertaken by utilities to improve the
customer experience. We also assessed
the reaction and sentiments of customers
towards those initiatives. We share these
findings over the following pages before
concluding with a set of pragmatic
recommendations on how utilities can
cement their relationship with customers
through digital, rather than threaten it.

Figure 2: Adoption of Digital Technologies by Utilities to Enhance Customer
Experience

% of utilities agreeing with the statement

40%
50% of customers prefer
to use a mobile customer
service application to try
to resolve their customer
service issues before
calling the contact center.

29%

We use digital technologies to
enable self-service

We use digital technologies to provide
consistency across channels

26%

11%

We use digital technologies to
personalize the sales experience

We use digital technologies to
conduct location-aware marketing

Source: Capgemini Consulting and MIT Center for Digital Business, “Digital Transformation Benchmark - 2012:
Emergence of the Digital Utility”, 2013.

3
Out of Tune: Digital Initiatives are Out of Sync with
Customer Expectations
52% of utilities allow
customers to pay bills
online through utility
websites, while 34% offer
bill payment features on
their mobile apps.
Billing Issues: A Concern
Despite New Digital
Payment Channels
Utilities have begun efforts to try and
simplify the billing and payments process
for customers. For instance, 52%
of utilities in our study (see research
methodology on page 7 for details) allow
customers to pay bills online through
their official websites, while 34% offer bill
payment features on their mobile apps.
However, despite these initiatives, billing
issues continue to be a cause of concern
for customers. Our analysis revealed that

only 30% of online customer mentions
related to utility billing services are
positive. The most common billing issues
that customers face include overcharges,
especially for delayed payments, and
inaccuracies in billing periods and rate
plans in utility invoices.

Outage Management
Remains a One-Way
Channel that Does Not
Support Customer
Feedback Mechanisms
Close to 52% of utilities in our study
provide outage information on their
websites, while 44% offer this information
through their mobile apps. Additionally,
58% of utility providers post power
outage information on social media
channels such as Twitter, Facebook, and
on company-managed blogs. However,
the majority of utilities do not offer a
mechanism for customers to report
outage issues. We found that only 26%
of customer mentions on the quality of
communication on outages are positive.

Mobile Apps Offer Limited
Functionality
56% of utility providers offer a mobile
app. However, most utilities offer only
basic functionality, such as the ability to
view service details or receive alerts from
providers. Only 24% of utility providers
offer advanced features, such as the
ability to report issues via the app (see
Figure 3). It is perhaps not surprising,
therefore, that only 32% of customer
opinions on the mobile apps offered by
utilities are favorable.

Only 32% of customer
opinions on the mobile
apps offered by utilities
are favorable.

Figure 3: Mobile App Feature Support

% of utilities offering the feature

46%

View service
details

40%
Receive
alerts
Source: Capgemini Consulting analysis

4

44%

View outage
information

34%
Access and
pay bills

44%

Update account
information

24%
Report
problems
Only 29% of the customer
sentiment on the quality
of customer support
offered by utilities is
positive.

Social Media is Not Used
as an Effective Medium for
Customer Service

on social media channels. It is telling that
only 29% of the sentiment on the quality
of customer support offered by utilities is
positive.

Utilities are using social media channels
primarily to share information, which
includes
energy
efficiency
tips,
emergency handling tips, or outage
information (see Figure 4). Social media
channels are also used as platforms for
brand building. For instance, 58% of
utilities use their social media channels to
promote their community development
initiatives. However, most utilities are
not utilizing their social media channels
to actively engage with customers. For
instance, only 34% of utilities address the
complaints they receive from customers

Only 34% of utilities
address the complaints
they receive from
customers on social media
channels.

Figure 4: Social Media Feature Support

% of utilities offering the feature via their social media channels

62%
Emergency
handling tips

58%
Power outage
information

60%
Energy
efficiency tips

36%
Contests /
promotions

58%
Information on community
development initiatives

34%
Customer
complaint redressal

Source: Capgemini Consulting analysis

5
The Disconnect between what Utilities Offer
and what Customers Experience
Are Utilities Doing Enough ?

Are Customers Satisfied ?

Mobile apps offer limited functionality

56%

of utility providers
offer a mobile app

32%

of customer opinions on
utilities’ mobile apps are
favorable

Social media is not used effectively for customer service

34%

address customer
complaints on social
media channels

29%

of the customer sentiment on
the quality of customer support
offered by utilities is positive

Websites lack self-service features

52%

enable
bill payments

28%
Only

of customer opinions on
self-service features offered
by utilities are favorable

Outage management does not support
customer feedback mechanisms

24%

offer the ability to
report problems
via mobile apps
6

26%

of customer mentions on
the quality of communication
on outages are positive

Source: Capgemini Consulting analysis
While utilities have tried to engage with
customers through a variety of digital
initiatives, their efforts are falling short.
To reflect on why that is and what can
be done, it would be helpful to look at

another industry that has made a virtue
of the digital customer experience, to
draw out best practice and the lessons
learned along the way. In the next section,
we cast our eye over the telecom sector,

which has had more joy in using digital
tools to improve and sustain the quality of
the customer experience.

Research Methodology
Part 1 – Analysis of Digital Initiatives Launched by Utilities to Improve Customer Experience
We studied the adoption of digital channels by the top 50 utility providers across the globe. Our research focused on their
web, mobile and social media initiatives. We evaluated each utility based on its use of social media platforms to provide
information, address customer complaints, manage outages and run promotions. Mobile customer care apps offered by
each utility were evaluated based on features such as the ability to access and pay bills, view and update information, and
report problems. We also assessed the web-based self-service features offered by each utility.

Part 2 – Analysis of Customer Sentiment towards Utility-Driven Digital Initiatives
We used advanced analytics tools to conduct an exhaustive web-based scan of customer reaction towards utility digital
initiatives. We gathered and analyzed customer sentiment data from a wide range of sources including social media sites,
blogs, and online discussion boards. The themes for our assessment included:
• Customer support — quality of complaint resolution and correction of billing issues.
• Self-service — quality of web and mobile self-service features.
• Outage management — quality of communication during outages and emergencies.
• Billing — billing accuracy and resolution of billing issues.
• Community development — sustainability initiatives undertaken by utilities.

7
Ringing the Changes: Best Practice for Utilities
from the Telecom Industry
The leading telecom companies offer
a good parallel for utility players. Like
utilities, telecom companies are engaged
in a service that serves millions of people
on a 24-hour basis. The telecom industry
was also one of the first areas to be
struck by the first disruptive wave of
digital technologies.

Utilities lag telecom
companies in the use of
social media platforms,
mobile channels, and
customer analytics to
reach and engage with
customers.
Our research with the MIT Center for
Digital Business revealed that utilities lag
telecom companies in the use of social
media platforms, mobile channels, and
customer analytics to reach and engage
with customers (see Figure 5)6. We believe
that utilities can draw useful lessons from

telecom companies on how to expand
the breadth and quality of their digital
customer experience initiatives.

to resolve customer issues through social
media channels, responding to more than
99% of the tweets it receives8.
Some telcos are also using social
media channels as an effective way of
encouraging self-service. For instance,
European telecom major O2 recently
launched its “#TweetServe” program,
designed to be a Twitter-based selfservice platform for customers. The
platform allows customers to send tweets
to the operator using specific keywords,
in order to obtain information on data
usage, bill related details, or special offers
and deals on new phones. Responses to
the tweets are sent back to customers in
the form of direct Twitter messages from
the operator9.

Verizon responds to more
than 99% of customer
tweets.
Telcos are Embedding
Customer Service within
Social Media Channels
Telecom operators are increasingly
making social media a central pillar of
their customer service strategy. A recent
study on the use of Twitter for customer
service found that most brands redirect
customer complaints received on social
media to traditional channels such as
phone and email7. Telecom companies,
however, were found to have the lowest
deflection rate of customer complaints
on social media, despite receiving among
the highest volumes of tweets. Verizon,
for instance, makes concerted attempts

O2 has launched a
Twitter based self-service
platform for customers,
called the “#TweetServe”
program.

Figure 5: Comparison of Digital Customer Experience Initiatives in the Telecom and Utilities Industries

Use of Customer
Anaytics

Use of Mobile
Channels

Use of Social
Media

Use of Digital for Customer Experience Improvement
Average industry ratings (on a scale of 1 to 7, with 7 being the highest)
…to provide customer service
...to promote products and services
…to sell products and services

4.6

3.4
3.9

3.0

…to provide customer service

…to sell products and services

4.2

3.4
3.8

3.0

…to target marketing initiatives more effectively

4.8

3.8

…to personalize marketing communication
…to optimize pricing

4.6

4.1

...to promote products and services

Source: Capgemini Consulting and MIT Center for Digital Business, 2012

8

4.7

3.4

3.7
3.4

4.4
4.4

Telecom
Utilities
Telcos are Making Digital
Channels a Seamless
Part of Their Support
Proposition
Some telcos have recognized the need
to ensure that digital channels do not
operate in isolation, but rather exist as
an integrated part of their overall service
proposition. For instance, Telefonica’s
Spanish subsidiary Movistar is upgrading
its CRM capabilities so that its customers
can seamlessly transition from their
mobile self-service apps to contact
center support. When a customer
selects the option to switch from the
app to the contact center, all information
about the customer’s activities in the
mobile application is transferred to the
contact center, providing the agent with
real-time information on the customer’s
profile and the context of the interaction.
Additionally, the upgrade enables
multimedia collaboration options, such
as the exchange of images between
the customer and contact center agent,
to further enhance the speed and
effectiveness of issue resolution10.

Telefonica Movistar
enables customers
to switch seamlessly
between their mobile selfservice app and contact
center support.

Similarly,
France-based
Bouygues
Telecom’s online-only brand B&YOU
offers a seamless and entirely digitized
customer service process. To reduce
service terminations, B&YOU offers clickto-call features on its website; customers
seeking to terminate a connection
are offered the click-to-call option to
speak with a customer service agent or
“e-advisor”, who attempts to address the
grievance that prompted the cancellation.
This has helped B&YOU reduce customer
churn by 50%11.

Telcos are Using Digital
Technologies to Effectively
Address Billing Concerns

Usage of such technology has enabled
AT&T to reduce inbound call volumes and
increase customer satisfaction scores12.

Digital technologies can also act as
effective
complementary
mediums
to address traditional challenges. For
instance, AT&T is using video and analytics
technology to provide customers with
greater transparency on their bills. The
company actually creates personalized
videos that help customers better
understand their bill. New customers and
customers who upgrade to new services
receive a link to a personalized video
along with their first bill. These videos
explain the different components of the
customer’s bill. In addition to improving
billing transparency, these digital initiatives
also enable AT&T to offer proactive
customer service. A built-in analytics
platform analyzes customer data and
agent logs and is used to create followup videos after a customer service call,
to provide additional self-service tips and
product and service recommendations.

The telco industry shows us how digital
technologies can create a compelling
customer experience, bridging the gap
between the digital needs of the customer
and their provider’s ability to deliver.
Although there are notable exceptions in
the utility industry (see insert on HydroQuebec), it is apparent that more needs
to be done. We conclude this paper with
some concrete recommendations for
how utilities can turn this situation around
– using digital to create a new level of
utility customer experience.

AT&T offers personalized
videos to help customers
better understand their
bills.

Hydro-Quebec: Transforming Customer
Experience through Digital
Hydro Quebec, a leading energy and utilities company in North America, generates,
transmits and distributes electricity, mainly using renewable energy sources. The
company historically had a limited presence on social media platforms and mobile
channels. Moreover, existing channels were siloed, which meant that the company did
not have a unified view of the customer.
In 2011, Hydro Quebec embarked on a four-year program to transform the organization
into one that was dedicated to the improvement of customer experience. Top of the list
of objectives were the creation of a multichannel customer experience improvement
strategy, the development of offers tailored to each market and customer segment,
and the promotion of a customer-centric culture within the organization.
As part of the transformation program, the company launched a “Drive to Web”
initiative, to make the web, and all other digital channels such as email, mobile and social
media, the core of the multichannel experience for the customer. The strategy aimed
at rationalizing traditional channels and delivering more value through digital channels.
Hydro Quebec strengthened its Web and mobile channels by offering enhancements
such as the explanation of bills and payment terms, improved management of outages,
and new smart metering services. The “Drive to Web” initiative resulted in an increase
in the number of customers opting for online self-care services, and consequently,
reduced inbound call volumes by 12%.
Source: Capgemini Consulting
9
Making It Happen: Transforming the Utility
Customer Experience through Digital
We believe there are three important steps
a utility must take to achieve the nirvana
of ‘digital utility’ (see Figure 6). You need
to give digital channels a boost, create
that seamless multi-channel experience,
and make your move towards being a
‘complete provider’.

Give Individual Channels a
Digital Boost
Expand the Scope of the Web and
Mobile Channel
Online and web channels must be used
more efficiently to deliver bills, with options
for customers to report errors easily.
Utilities must create web-based selfservice features that allow customers to
view patterns in energy usage, by month,
day or hour, as well as peak and non-peak
hour tariffs. This will enable customers
to switch to a tariff plan that matches
their usage and even to alter usage to
reduce energy consumption. Similarly,
mobile apps must offer functionality for
customers to report billing errors or seek
clarifications on bills.

Utilities must ensure
that complaints on social
media are addressed in
a timely manner, with
clearly defined SLAs that
match those of contact
center services.
Strengthen Customer Service
Capabilities on Social Media
Utilities must strengthen their social
media customer service capabilities.
Utilities should set up a dedicated social
media account, such as a Twitter handle,
to address customer issues. Utilities
must also ensure that complaints are
addressed in a timely manner, with clearly
defined SLAs that match those of contact
center services.

However, setting up a dedicated social
media account and establishing SLAs for
response are only part of the story. Utilities
should actively invest in training customer
service teams that manage social media
channels to ensure complaints are closed
on the social channel itself, rather than
being redirected to traditional channels.

Existing CRM processes
need to be adapted to
support an Any Time Any
Where Any Device model
of service delivery.

Figure 6: Towards a Digital Utility

Move towards Being
Complete Energy
Services Providers
Create a Seamless
Multi-Channel Experience
Give Individual Channels
a Digital Boost

Source: Capgemini Consulting analysis

10
Deliver a Seamless
Multichannel Anytime
Anywhere Any Device
Experience
A robust multichannel customer service
strategy lies at the heart of an engaging
customer experience. Utilities need to
ensure that all digital channels that serve
as customer touchpoints are seamlessly
integrated. This is critical if customers are
to receive a consistent experience across
channels, and customer interactions that
begin in one channel can be completed
in another without disruption. Existing
CRM processes will need to be adapted
to support an ‘Any Time Any Where Any
Device’ model of service delivery (see
Figure 7). This will also ensure that utilities
are well-placed to take advantage of new
customer service opportunities, such as
providing personalized recommendations
on energy usage or promoting new
services.
Utilities need to consciously increase
the volume and value added through
digital channels and services. As the

Hydro-Quebec case demonstrated, by
doing so, they can decrease inbound flow
on traditional channels. This has a direct
impact of improving the bottom-line by
reducing the utility cost to serve as well as
cost to acquire customers.

To drive long term
customer stickiness,
utilities should transform
themselves from energy
suppliers to energy
service providers.

Develop an Energy Services
Portfolio
To create long-term customer loyalty,
utilities should transform themselves
from energy suppliers to energy service
providers. Energy usage data gathered
from smart meters offers an opportunity

for utilities to realize this transformation.
Smart meter data can be used to segment
customers more accurately and offer a
range of customized energy management
services. This includes real-time insights
on energy usage and personalized advice
on reducing consumption. Further, smart
meter data can also be used to roll out
targeted demand response programs to
incentivize energy efficiency. For instance,
customers who reduce electricity usage
during peak hours could be offered bill
credits. Such services will enable utilities to
create more value for themselves as well
as customers, in turn driving sustained
customer satisfaction and loyalty.

Using digital technologies, utilities have
abundant opportunities to simplify and
enrich the lives of their consumers.
Clearly, the heart of the issue is ensuring
that exceptional customer service is your
raison d’être. But with savvy consumers
demanding this service across digital
channels, utilities need to bridge the
digital divide that threatens to undermine
their customer promise.

Figure 7: Delivering a Seamless Multichannel Customer Experience

Discovery

First Order

<< Normal Life >>

Discover New Products

Renewal

I visit a store for
more information
I get my bill with details of
the loyalty program
I look for information on my
mobile or tablet to
enrich my usage
Differentiation
based on customer
segmentation

A friend
recommends
a new offer
on Facebook

I learn
about the
offer on
the web
I place an order
on the brand’s
website

I share my experience
on the brand’s official
blog and post my
opinion on social
networks

I get a personalized email
with the special offer of
re-engagement that I saw
on Twitter

I am informed on
Twitter with a
special offer of
re-engagement

I call an advisor to
re-engage, using a
click-to-call option

Source: Capgemini Consulting analysis

11
References
1	

Ipsos MORI, “Customer Engagement with the Energy Market – Tracking Survey”, June 2013

2	

Edelman, “Trust in Energy – 2014 Edelman Trust Barometer”, January 2014

3	

Pike Research Survey, “Social Media in the Utility Industry Consumer Survey”, 2012

4	

IMIMobile, Energy and Utilities webpage

5	

Capgemini and MIT Center for Digital Business, “Digital Transformation Benchmark - 2012: Emergence of the Digital Utility”,
2012

6	

Capgemini Consulting and MIT Center for Digital Business Research, 2012

7	

Conversocial, “Which brands are Re-directing Social Media Complaints to Traditional Channels”, August 2013

8	

Conversocial, “With Twitter’s IPO Approaching, Which Brands Are Taking it Seriously as a Customer Service Channel?”,
October 2013

9	

O2, “O2 launches ‘world first’ #TweetServe program”, October 2013

10	 Yahoo Finance, “NICE Mobile Reach Selected by Telefónica to Provide Exceptional Customer Service”, February 2013
11	 Oracle.com, “Bouygues Telecom Reduces Customer Churn by 50% with Click-to-Call Technology”, November 2013
12	 Forbes, “AT&T Gets Results With Proactive Customer Service”, November 2013

12
Authors
Philippe Vié
Vice President, Digital Utilities Leader
philippe.vie@capgemini.com

Subrahmanyam KVJ
Manager
subrahmanyam.kvj@capgemini.com

Digital Transformation
Research Institute
dtri.in@capgemini.com

Jerome Buvat
Head of Digital Transformation Research
Institute
jerome.buvat@capgemini.com

Suvidha Aggarwal
Senior Consultant
suvidha.aggarwal@capgemini.com

Amrita Radhakrishnan
Senior Consultant
amrita.radhakrishnan@capgemini.com

The authors would also like to acknowledge the contributions of Simon Short and Maggie Buggie from the Capgemini Digital
Customer Experience team, Roopa Nambiar from the Digital Transformation Research Institute, Abhishek Gokhale and
Jinesh Jain from the Capgemini Consulting India Team.

For more information contact
Belgium
Pierre Lorquet
pierre.lorquet@capgemini.com

Italy
Giuseppe Luigi Vicini
giuseppe.vicini@capgemini.com

Spain
Carlos Garcia Santos
carlos.garcia.s@capgemini.com

France
Jean Pierre DUPE
jean-pierre.dupe@capgemini.com

Netherlands
Mark Schutz
mark.schutz@capgemini.com

Spain
Oscar Sommarriba Guemes
oscar.sommarriba@capgemini.com

France
Philippe Vié
philippe.vie@capgemini.com

North America
Tyler Duff
tyler.duff@capgemini.com

Sweden
Fredrik Gunnarsson
fredrik.gunnarson@capgemini.com

Germany
Andreas Weiler
andreas.weiler@capgemini.com

Norway
Tallak Thorleifsson
tallak.thorleifsson@capgemini.com

United Kingdom
Martin Wells
martin.wells@capgemini.com
Digital Utilities Transformation – Improving Customer Experience and Operating Models through Disruptive
Technologies
Capgemini’s integrated Digital Utilities Transformation framework empowers traditional utilities to re-invent themselves and internalize
the disruptive digital technologies at optimized capital costs, while providing infrastructures and services enabling the energy transition
towards a sustainable, low carbon economy. Our approach will drive utilities to become customers and communities centric and to totally
rethink their internal organization, the role of line workers, whilst it will drive down their cost. Moreover, we can help utilities to enable new
services like Home Energy Management and energy efficiency programs or communities programs.

Digital Customer Experience
The Capgemini Global Service Line entitled Digital Customer Experience (DCX), helps organizations understand and implement
the right mix of business focused digital capabilities, deployed within the right framework for transformation – to fundamentally
change how they do business and serve their customers. Digitally mature organizations deliver on improving customer advocacy
and driving growth.
Available worldwide and across all industry sectors, the consolidated offer from Capgemini helps enterprises to embed digital
customer experiences into the heart of their organizations, while transforming their future business models and processes. DCX
addresses the need to achieve and sustain business value via digital initiatives, from the back-end right through to the front line.

About Capgemini and the
Collaborative Business Experience
Capgemini Consulting is the global strategy and transformation
consulting organization of the Capgemini Group, specializing
in advising and supporting enterprises in significant
transformation, from innovative strategy to execution and with
an unstinting focus on results. With the new digital economy
creating significant disruptions and opportunities, our global
team of over 3,600 talented individuals work with leading
companies and governments to master Digital Transformation,
drawing on our understanding of the digital economy and
our leadership in business transformation and organizational
change.

With more than 130,000 people in 44 countries, Capgemini
is one of the world’s foremost providers of consulting,
technology and outsourcing services. The Group reported 2012
global revenues of EUR 10.3 billion. Together with its clients,
Capgemini creates and delivers business and technology
solutions that fit their needs and drive the results they want. A
deeply multicultural organization, Capgemini has developed its
own way of working, the Collaborative Business ExperienceTM,
and draws on Rightshore®, its worldwide delivery model.
Learn more about us at www.capgemini.com

Find out more at:
http://www.capgemini-consulting.com/
Rightshore® is a trademark belonging to Capgemini

Capgemini Consulting is the strategy and transformation consulting brand of Capgemini Group. The information contained in this document is proprietary.
© 2013 Capgemini. All rights reserved.

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The Digital Divide in Utilities; the growing gap between customers and Utilities

  • 1. So Near Yet so Far Why Utilities Need to Re-energize Their Digital Customer Experience
  • 2. Mind the Gap: How a Digital Divide is Compromising the Utility Customer Experience levels in Britain dropped from 78% in 2012 to 55% in 2013. And only 29% of customers trusted their utility providers to be open and transparent in 2013, compared to 34% in 20121. For the EU as a whole, customers’ trust levels in their energy suppliers stood at just 45%, and in North America, at 53% in 20132. Only 29% of customers trusted their utility providers in 2013. Utilities Face Growing Customer Dissatisfaction There is simmering discontent in the utilities industry. Customers, already increasingly demanding, are now actively dissatisfied with their providers. Take the UK as an example. Customer satisfaction There is clearly a need to address this tide of disquiet and re-energize the utility customer experience. Industry analyst surveys show that utilities have realized the need for enhancing customer experience (see Figure 1). However, the industry’s best efforts to rebuild confidence and trust could in fact be undermined by a growing digital divide, with consumers demanding a digital experience that the industry has so far been unable to meet. Customer satisfaction levels in the UK dropped from 78% in 2012 to 55% in 2013. Figure 1: Top Business Challenges for Utilities Top Business Challenges European Utilities Top Business Challenges North American Utilities Maintain regulatory compliance Maintain regulatory compliance Enhance customer experience Smart metering Retain customers Aging infrastructure Smart networks Environmental legislation Environmental legislation Enhance customer experience Smart metering Revenue protection Revenue protection Smart networks Aging infrastructure Retain customers Manage an aging workforce Manage an aging workforce 1.0 1.5 2.0 2.5 3.0 3.5 1.0 Average rating 1.5 2.0 2.5 3.0 3.5 Average rating Sample size: 111 Sample size: 48 Question: How important are the above business challenges to your organization? Question: How important are the above business challenges to your organization? Source: Ovum, “ICT Enterprise Insights in the Utilities Industry”, 2013 2
  • 3. Nearly 624 million customers are expected to engage with utilities via social media by the end of 2017. Thwarted Desire: Utilities Have Not Met their Customers’ Digital Wants Utility customers want to go digital. Platforms such as social media and mobile apps are rapidly becoming the preferred means for customers to communicate with their providers. Research indicates that over 57 million customers engaged with utilities via social media in 2011 and that this number is expected to rise to 624 million by the end of 20173. It is also estimated that 50% of customers prefer to use a mobile customer service application to try and resolve their service issues before calling the contact center4. Unfortunately, utilities have not kept pace with consumers in the shift to digital channels. Our research with the MIT Centre for Digital Business shows that only 40% of utility providers use digital technologies to enable self-service (see Figure 2). Less than 30% of utilities use digital technologies to provide a consistent experience across channels5. While utilities have undoubtedly taken their first steps towards a brighter digital future, they have a long way to go. We conducted a detailed study to understand the digital initiatives being undertaken by utilities to improve the customer experience. We also assessed the reaction and sentiments of customers towards those initiatives. We share these findings over the following pages before concluding with a set of pragmatic recommendations on how utilities can cement their relationship with customers through digital, rather than threaten it. Figure 2: Adoption of Digital Technologies by Utilities to Enhance Customer Experience % of utilities agreeing with the statement 40% 50% of customers prefer to use a mobile customer service application to try to resolve their customer service issues before calling the contact center. 29% We use digital technologies to enable self-service We use digital technologies to provide consistency across channels 26% 11% We use digital technologies to personalize the sales experience We use digital technologies to conduct location-aware marketing Source: Capgemini Consulting and MIT Center for Digital Business, “Digital Transformation Benchmark - 2012: Emergence of the Digital Utility”, 2013. 3
  • 4. Out of Tune: Digital Initiatives are Out of Sync with Customer Expectations 52% of utilities allow customers to pay bills online through utility websites, while 34% offer bill payment features on their mobile apps. Billing Issues: A Concern Despite New Digital Payment Channels Utilities have begun efforts to try and simplify the billing and payments process for customers. For instance, 52% of utilities in our study (see research methodology on page 7 for details) allow customers to pay bills online through their official websites, while 34% offer bill payment features on their mobile apps. However, despite these initiatives, billing issues continue to be a cause of concern for customers. Our analysis revealed that only 30% of online customer mentions related to utility billing services are positive. The most common billing issues that customers face include overcharges, especially for delayed payments, and inaccuracies in billing periods and rate plans in utility invoices. Outage Management Remains a One-Way Channel that Does Not Support Customer Feedback Mechanisms Close to 52% of utilities in our study provide outage information on their websites, while 44% offer this information through their mobile apps. Additionally, 58% of utility providers post power outage information on social media channels such as Twitter, Facebook, and on company-managed blogs. However, the majority of utilities do not offer a mechanism for customers to report outage issues. We found that only 26% of customer mentions on the quality of communication on outages are positive. Mobile Apps Offer Limited Functionality 56% of utility providers offer a mobile app. However, most utilities offer only basic functionality, such as the ability to view service details or receive alerts from providers. Only 24% of utility providers offer advanced features, such as the ability to report issues via the app (see Figure 3). It is perhaps not surprising, therefore, that only 32% of customer opinions on the mobile apps offered by utilities are favorable. Only 32% of customer opinions on the mobile apps offered by utilities are favorable. Figure 3: Mobile App Feature Support % of utilities offering the feature 46% View service details 40% Receive alerts Source: Capgemini Consulting analysis 4 44% View outage information 34% Access and pay bills 44% Update account information 24% Report problems
  • 5. Only 29% of the customer sentiment on the quality of customer support offered by utilities is positive. Social Media is Not Used as an Effective Medium for Customer Service on social media channels. It is telling that only 29% of the sentiment on the quality of customer support offered by utilities is positive. Utilities are using social media channels primarily to share information, which includes energy efficiency tips, emergency handling tips, or outage information (see Figure 4). Social media channels are also used as platforms for brand building. For instance, 58% of utilities use their social media channels to promote their community development initiatives. However, most utilities are not utilizing their social media channels to actively engage with customers. For instance, only 34% of utilities address the complaints they receive from customers Only 34% of utilities address the complaints they receive from customers on social media channels. Figure 4: Social Media Feature Support % of utilities offering the feature via their social media channels 62% Emergency handling tips 58% Power outage information 60% Energy efficiency tips 36% Contests / promotions 58% Information on community development initiatives 34% Customer complaint redressal Source: Capgemini Consulting analysis 5
  • 6. The Disconnect between what Utilities Offer and what Customers Experience Are Utilities Doing Enough ? Are Customers Satisfied ? Mobile apps offer limited functionality 56% of utility providers offer a mobile app 32% of customer opinions on utilities’ mobile apps are favorable Social media is not used effectively for customer service 34% address customer complaints on social media channels 29% of the customer sentiment on the quality of customer support offered by utilities is positive Websites lack self-service features 52% enable bill payments 28% Only of customer opinions on self-service features offered by utilities are favorable Outage management does not support customer feedback mechanisms 24% offer the ability to report problems via mobile apps 6 26% of customer mentions on the quality of communication on outages are positive Source: Capgemini Consulting analysis
  • 7. While utilities have tried to engage with customers through a variety of digital initiatives, their efforts are falling short. To reflect on why that is and what can be done, it would be helpful to look at another industry that has made a virtue of the digital customer experience, to draw out best practice and the lessons learned along the way. In the next section, we cast our eye over the telecom sector, which has had more joy in using digital tools to improve and sustain the quality of the customer experience. Research Methodology Part 1 – Analysis of Digital Initiatives Launched by Utilities to Improve Customer Experience We studied the adoption of digital channels by the top 50 utility providers across the globe. Our research focused on their web, mobile and social media initiatives. We evaluated each utility based on its use of social media platforms to provide information, address customer complaints, manage outages and run promotions. Mobile customer care apps offered by each utility were evaluated based on features such as the ability to access and pay bills, view and update information, and report problems. We also assessed the web-based self-service features offered by each utility. Part 2 – Analysis of Customer Sentiment towards Utility-Driven Digital Initiatives We used advanced analytics tools to conduct an exhaustive web-based scan of customer reaction towards utility digital initiatives. We gathered and analyzed customer sentiment data from a wide range of sources including social media sites, blogs, and online discussion boards. The themes for our assessment included: • Customer support — quality of complaint resolution and correction of billing issues. • Self-service — quality of web and mobile self-service features. • Outage management — quality of communication during outages and emergencies. • Billing — billing accuracy and resolution of billing issues. • Community development — sustainability initiatives undertaken by utilities. 7
  • 8. Ringing the Changes: Best Practice for Utilities from the Telecom Industry The leading telecom companies offer a good parallel for utility players. Like utilities, telecom companies are engaged in a service that serves millions of people on a 24-hour basis. The telecom industry was also one of the first areas to be struck by the first disruptive wave of digital technologies. Utilities lag telecom companies in the use of social media platforms, mobile channels, and customer analytics to reach and engage with customers. Our research with the MIT Center for Digital Business revealed that utilities lag telecom companies in the use of social media platforms, mobile channels, and customer analytics to reach and engage with customers (see Figure 5)6. We believe that utilities can draw useful lessons from telecom companies on how to expand the breadth and quality of their digital customer experience initiatives. to resolve customer issues through social media channels, responding to more than 99% of the tweets it receives8. Some telcos are also using social media channels as an effective way of encouraging self-service. For instance, European telecom major O2 recently launched its “#TweetServe” program, designed to be a Twitter-based selfservice platform for customers. The platform allows customers to send tweets to the operator using specific keywords, in order to obtain information on data usage, bill related details, or special offers and deals on new phones. Responses to the tweets are sent back to customers in the form of direct Twitter messages from the operator9. Verizon responds to more than 99% of customer tweets. Telcos are Embedding Customer Service within Social Media Channels Telecom operators are increasingly making social media a central pillar of their customer service strategy. A recent study on the use of Twitter for customer service found that most brands redirect customer complaints received on social media to traditional channels such as phone and email7. Telecom companies, however, were found to have the lowest deflection rate of customer complaints on social media, despite receiving among the highest volumes of tweets. Verizon, for instance, makes concerted attempts O2 has launched a Twitter based self-service platform for customers, called the “#TweetServe” program. Figure 5: Comparison of Digital Customer Experience Initiatives in the Telecom and Utilities Industries Use of Customer Anaytics Use of Mobile Channels Use of Social Media Use of Digital for Customer Experience Improvement Average industry ratings (on a scale of 1 to 7, with 7 being the highest) …to provide customer service ...to promote products and services …to sell products and services 4.6 3.4 3.9 3.0 …to provide customer service …to sell products and services 4.2 3.4 3.8 3.0 …to target marketing initiatives more effectively 4.8 3.8 …to personalize marketing communication …to optimize pricing 4.6 4.1 ...to promote products and services Source: Capgemini Consulting and MIT Center for Digital Business, 2012 8 4.7 3.4 3.7 3.4 4.4 4.4 Telecom Utilities
  • 9. Telcos are Making Digital Channels a Seamless Part of Their Support Proposition Some telcos have recognized the need to ensure that digital channels do not operate in isolation, but rather exist as an integrated part of their overall service proposition. For instance, Telefonica’s Spanish subsidiary Movistar is upgrading its CRM capabilities so that its customers can seamlessly transition from their mobile self-service apps to contact center support. When a customer selects the option to switch from the app to the contact center, all information about the customer’s activities in the mobile application is transferred to the contact center, providing the agent with real-time information on the customer’s profile and the context of the interaction. Additionally, the upgrade enables multimedia collaboration options, such as the exchange of images between the customer and contact center agent, to further enhance the speed and effectiveness of issue resolution10. Telefonica Movistar enables customers to switch seamlessly between their mobile selfservice app and contact center support. Similarly, France-based Bouygues Telecom’s online-only brand B&YOU offers a seamless and entirely digitized customer service process. To reduce service terminations, B&YOU offers clickto-call features on its website; customers seeking to terminate a connection are offered the click-to-call option to speak with a customer service agent or “e-advisor”, who attempts to address the grievance that prompted the cancellation. This has helped B&YOU reduce customer churn by 50%11. Telcos are Using Digital Technologies to Effectively Address Billing Concerns Usage of such technology has enabled AT&T to reduce inbound call volumes and increase customer satisfaction scores12. Digital technologies can also act as effective complementary mediums to address traditional challenges. For instance, AT&T is using video and analytics technology to provide customers with greater transparency on their bills. The company actually creates personalized videos that help customers better understand their bill. New customers and customers who upgrade to new services receive a link to a personalized video along with their first bill. These videos explain the different components of the customer’s bill. In addition to improving billing transparency, these digital initiatives also enable AT&T to offer proactive customer service. A built-in analytics platform analyzes customer data and agent logs and is used to create followup videos after a customer service call, to provide additional self-service tips and product and service recommendations. The telco industry shows us how digital technologies can create a compelling customer experience, bridging the gap between the digital needs of the customer and their provider’s ability to deliver. Although there are notable exceptions in the utility industry (see insert on HydroQuebec), it is apparent that more needs to be done. We conclude this paper with some concrete recommendations for how utilities can turn this situation around – using digital to create a new level of utility customer experience. AT&T offers personalized videos to help customers better understand their bills. Hydro-Quebec: Transforming Customer Experience through Digital Hydro Quebec, a leading energy and utilities company in North America, generates, transmits and distributes electricity, mainly using renewable energy sources. The company historically had a limited presence on social media platforms and mobile channels. Moreover, existing channels were siloed, which meant that the company did not have a unified view of the customer. In 2011, Hydro Quebec embarked on a four-year program to transform the organization into one that was dedicated to the improvement of customer experience. Top of the list of objectives were the creation of a multichannel customer experience improvement strategy, the development of offers tailored to each market and customer segment, and the promotion of a customer-centric culture within the organization. As part of the transformation program, the company launched a “Drive to Web” initiative, to make the web, and all other digital channels such as email, mobile and social media, the core of the multichannel experience for the customer. The strategy aimed at rationalizing traditional channels and delivering more value through digital channels. Hydro Quebec strengthened its Web and mobile channels by offering enhancements such as the explanation of bills and payment terms, improved management of outages, and new smart metering services. The “Drive to Web” initiative resulted in an increase in the number of customers opting for online self-care services, and consequently, reduced inbound call volumes by 12%. Source: Capgemini Consulting 9
  • 10. Making It Happen: Transforming the Utility Customer Experience through Digital We believe there are three important steps a utility must take to achieve the nirvana of ‘digital utility’ (see Figure 6). You need to give digital channels a boost, create that seamless multi-channel experience, and make your move towards being a ‘complete provider’. Give Individual Channels a Digital Boost Expand the Scope of the Web and Mobile Channel Online and web channels must be used more efficiently to deliver bills, with options for customers to report errors easily. Utilities must create web-based selfservice features that allow customers to view patterns in energy usage, by month, day or hour, as well as peak and non-peak hour tariffs. This will enable customers to switch to a tariff plan that matches their usage and even to alter usage to reduce energy consumption. Similarly, mobile apps must offer functionality for customers to report billing errors or seek clarifications on bills. Utilities must ensure that complaints on social media are addressed in a timely manner, with clearly defined SLAs that match those of contact center services. Strengthen Customer Service Capabilities on Social Media Utilities must strengthen their social media customer service capabilities. Utilities should set up a dedicated social media account, such as a Twitter handle, to address customer issues. Utilities must also ensure that complaints are addressed in a timely manner, with clearly defined SLAs that match those of contact center services. However, setting up a dedicated social media account and establishing SLAs for response are only part of the story. Utilities should actively invest in training customer service teams that manage social media channels to ensure complaints are closed on the social channel itself, rather than being redirected to traditional channels. Existing CRM processes need to be adapted to support an Any Time Any Where Any Device model of service delivery. Figure 6: Towards a Digital Utility Move towards Being Complete Energy Services Providers Create a Seamless Multi-Channel Experience Give Individual Channels a Digital Boost Source: Capgemini Consulting analysis 10
  • 11. Deliver a Seamless Multichannel Anytime Anywhere Any Device Experience A robust multichannel customer service strategy lies at the heart of an engaging customer experience. Utilities need to ensure that all digital channels that serve as customer touchpoints are seamlessly integrated. This is critical if customers are to receive a consistent experience across channels, and customer interactions that begin in one channel can be completed in another without disruption. Existing CRM processes will need to be adapted to support an ‘Any Time Any Where Any Device’ model of service delivery (see Figure 7). This will also ensure that utilities are well-placed to take advantage of new customer service opportunities, such as providing personalized recommendations on energy usage or promoting new services. Utilities need to consciously increase the volume and value added through digital channels and services. As the Hydro-Quebec case demonstrated, by doing so, they can decrease inbound flow on traditional channels. This has a direct impact of improving the bottom-line by reducing the utility cost to serve as well as cost to acquire customers. To drive long term customer stickiness, utilities should transform themselves from energy suppliers to energy service providers. Develop an Energy Services Portfolio To create long-term customer loyalty, utilities should transform themselves from energy suppliers to energy service providers. Energy usage data gathered from smart meters offers an opportunity for utilities to realize this transformation. Smart meter data can be used to segment customers more accurately and offer a range of customized energy management services. This includes real-time insights on energy usage and personalized advice on reducing consumption. Further, smart meter data can also be used to roll out targeted demand response programs to incentivize energy efficiency. For instance, customers who reduce electricity usage during peak hours could be offered bill credits. Such services will enable utilities to create more value for themselves as well as customers, in turn driving sustained customer satisfaction and loyalty. Using digital technologies, utilities have abundant opportunities to simplify and enrich the lives of their consumers. Clearly, the heart of the issue is ensuring that exceptional customer service is your raison d’être. But with savvy consumers demanding this service across digital channels, utilities need to bridge the digital divide that threatens to undermine their customer promise. Figure 7: Delivering a Seamless Multichannel Customer Experience Discovery First Order << Normal Life >> Discover New Products Renewal I visit a store for more information I get my bill with details of the loyalty program I look for information on my mobile or tablet to enrich my usage Differentiation based on customer segmentation A friend recommends a new offer on Facebook I learn about the offer on the web I place an order on the brand’s website I share my experience on the brand’s official blog and post my opinion on social networks I get a personalized email with the special offer of re-engagement that I saw on Twitter I am informed on Twitter with a special offer of re-engagement I call an advisor to re-engage, using a click-to-call option Source: Capgemini Consulting analysis 11
  • 12. References 1 Ipsos MORI, “Customer Engagement with the Energy Market – Tracking Survey”, June 2013 2 Edelman, “Trust in Energy – 2014 Edelman Trust Barometer”, January 2014 3 Pike Research Survey, “Social Media in the Utility Industry Consumer Survey”, 2012 4 IMIMobile, Energy and Utilities webpage 5 Capgemini and MIT Center for Digital Business, “Digital Transformation Benchmark - 2012: Emergence of the Digital Utility”, 2012 6 Capgemini Consulting and MIT Center for Digital Business Research, 2012 7 Conversocial, “Which brands are Re-directing Social Media Complaints to Traditional Channels”, August 2013 8 Conversocial, “With Twitter’s IPO Approaching, Which Brands Are Taking it Seriously as a Customer Service Channel?”, October 2013 9 O2, “O2 launches ‘world first’ #TweetServe program”, October 2013 10 Yahoo Finance, “NICE Mobile Reach Selected by Telefónica to Provide Exceptional Customer Service”, February 2013 11 Oracle.com, “Bouygues Telecom Reduces Customer Churn by 50% with Click-to-Call Technology”, November 2013 12 Forbes, “AT&T Gets Results With Proactive Customer Service”, November 2013 12
  • 13. Authors Philippe Vié Vice President, Digital Utilities Leader philippe.vie@capgemini.com Subrahmanyam KVJ Manager subrahmanyam.kvj@capgemini.com Digital Transformation Research Institute dtri.in@capgemini.com Jerome Buvat Head of Digital Transformation Research Institute jerome.buvat@capgemini.com Suvidha Aggarwal Senior Consultant suvidha.aggarwal@capgemini.com Amrita Radhakrishnan Senior Consultant amrita.radhakrishnan@capgemini.com The authors would also like to acknowledge the contributions of Simon Short and Maggie Buggie from the Capgemini Digital Customer Experience team, Roopa Nambiar from the Digital Transformation Research Institute, Abhishek Gokhale and Jinesh Jain from the Capgemini Consulting India Team. For more information contact Belgium Pierre Lorquet pierre.lorquet@capgemini.com Italy Giuseppe Luigi Vicini giuseppe.vicini@capgemini.com Spain Carlos Garcia Santos carlos.garcia.s@capgemini.com France Jean Pierre DUPE jean-pierre.dupe@capgemini.com Netherlands Mark Schutz mark.schutz@capgemini.com Spain Oscar Sommarriba Guemes oscar.sommarriba@capgemini.com France Philippe Vié philippe.vie@capgemini.com North America Tyler Duff tyler.duff@capgemini.com Sweden Fredrik Gunnarsson fredrik.gunnarson@capgemini.com Germany Andreas Weiler andreas.weiler@capgemini.com Norway Tallak Thorleifsson tallak.thorleifsson@capgemini.com United Kingdom Martin Wells martin.wells@capgemini.com
  • 14. Digital Utilities Transformation – Improving Customer Experience and Operating Models through Disruptive Technologies Capgemini’s integrated Digital Utilities Transformation framework empowers traditional utilities to re-invent themselves and internalize the disruptive digital technologies at optimized capital costs, while providing infrastructures and services enabling the energy transition towards a sustainable, low carbon economy. Our approach will drive utilities to become customers and communities centric and to totally rethink their internal organization, the role of line workers, whilst it will drive down their cost. Moreover, we can help utilities to enable new services like Home Energy Management and energy efficiency programs or communities programs. Digital Customer Experience The Capgemini Global Service Line entitled Digital Customer Experience (DCX), helps organizations understand and implement the right mix of business focused digital capabilities, deployed within the right framework for transformation – to fundamentally change how they do business and serve their customers. Digitally mature organizations deliver on improving customer advocacy and driving growth. Available worldwide and across all industry sectors, the consolidated offer from Capgemini helps enterprises to embed digital customer experiences into the heart of their organizations, while transforming their future business models and processes. DCX addresses the need to achieve and sustain business value via digital initiatives, from the back-end right through to the front line. About Capgemini and the Collaborative Business Experience Capgemini Consulting is the global strategy and transformation consulting organization of the Capgemini Group, specializing in advising and supporting enterprises in significant transformation, from innovative strategy to execution and with an unstinting focus on results. With the new digital economy creating significant disruptions and opportunities, our global team of over 3,600 talented individuals work with leading companies and governments to master Digital Transformation, drawing on our understanding of the digital economy and our leadership in business transformation and organizational change. With more than 130,000 people in 44 countries, Capgemini is one of the world’s foremost providers of consulting, technology and outsourcing services. The Group reported 2012 global revenues of EUR 10.3 billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organization, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model. Learn more about us at www.capgemini.com Find out more at: http://www.capgemini-consulting.com/ Rightshore® is a trademark belonging to Capgemini Capgemini Consulting is the strategy and transformation consulting brand of Capgemini Group. The information contained in this document is proprietary. © 2013 Capgemini. All rights reserved.