• Nick

Useless utilities? Energy companies are failed by their brands

Utlility paradox

This week there’s been yet another hoo-haa going on in Blighty about energy prices and profiteering. In the dock this time is Centrica, owner of British Gas, who have made some large profits whilst we, the impoverished squeezed middle, shiver in the cold.

This is – according to Alex Brummer of the Daily Mail no less – “not an acceptable way to behave for what is essentially a utility“.

Raises some questions – what do we mean by a utility? How do we expect them to behave nowadays? How should we engage with them, and how should they engage with us?

I have always been puzzled by the utility paradox – why do we care so little for the players yet care so much about what they do? This is a sector bereft of trust and where the brands are utterly failing to engage.

Brand fail

What’s gone wrong? A few things to consider –

Despite all the gazillions of marketing effort that’s gone into educating us about tariffs and prices 82% of us still don’t know what tariff we’re on nor how much we pay *

Most consumers have little or no direct contact with energy brands – other than through the bill and the occasional ‘chugger’ style tariff ambush in a supermarket. No surprise then that consumer satisfaction with energy companies is shocking – ranging from a ‘high’ of 51% to a low of 39% (E.on get to the back of the class). Business satisfaction isn’t much better – between 54% and 68%.

Above all – ordinary, normal people simply do not trust the energy industry. **

“energy suppliers are perceived to be running a monopoly to maximise profits at the expense of customers”

This is a brand failure. And it’s a big one.

The perception of the energy companies (the big ones) is individually and collectively terrible. Profiteering and untrustworthy.

The reality is that these companies are wrestling with huge, difficult and critical issues that will afffects us all. And that we should be fully engaged in.

The ‘trilemma’ is this: how do we keep the lights on, AND keep energy affordable. AND shift to a sustainable energy future?

(and how do we do all that for the long term when policy and public sentiment towards different energy sources changes more often than the landlord of the Queen Vic?)

What the brand people should be doing

The trilemma is hard stuff – and we all need to get a hell of a lot more engaged in it because we, and how we behave, are a massive part of solving it. Energy efficiency is not a supply side issue. Sure there can be improvements in appliances and metering and whatnot but the big, big shift is in our attitudes towards it.

And here’s where there’s a massive gap. Because a) most of us regard energy as essential not discretionary spending and b) we don’t link cost reduction with energy efficiency (in fact worse – we think energy efficiency is somehow impoverishing, that it means going without).

This gap has to be closed, and it should be the primary responsibility of the energy brands to be closing it. To be engaging us in how we use energy, in how we consume.

But they aren’t. All they are doing is quacking on about price and none of us are listening.

If I was running an energy company I’d be mighty annoyed with my brand people.

The entire category is failing to engage – there’s a huge, glaring opportunity for a leader to emerge, to break the game and establish new rules of engagement with all stakeholders:

  1. consumers in efficiency – not just price

  2. general public in the trade-offs around sustainable energy futures

  3. shareholders and regulators in the big long term energy bets (policy and investment)

Without such engagement the energy companies fully deserve to be treated as utilities – and if that happens public engagement will surely be handled by a third party, someone neutral and brand savvy…..

* page 8 in the EST evidence, I know it’s a long doc….

**from page 14…..

#britishgas #centrica #brandfailure #utilities #JamieOliver #nickkeppelpalmer

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