Customer Experience Management: How a European Energy Sector Major Reversed the Decline in its Market Share and Improved Financial Results by More than €30
What is customer experience management strategy? A customer experience management strategy is a key differentiator for businesses across industries. It generally involves a customer experience management system that businesses leverage to track, oversee, and react to customer interactions. By doing so companies can exceed customer expectations and increase customer satisfaction rates, customer loyalty, and advocacy. [...]READ MORE >>
What is customer experience management strategy?
A customer experience management strategy is a key differentiator for businesses across industries. It generally involves a customer experience management system that businesses leverage to track, oversee, and react to customer interactions. By doing so companies can exceed customer expectations and increase customer satisfaction rates, customer loyalty, and advocacy.
For years now, the traditional customer focus of the energy sector revolved around ‘performance-based satisfaction’. Customer experience management strategies that responded satisfactorily to basic concerns of reliability, safety, pricing, information provision and resolution of any problems were sufficient. But, today there is a strong focus on the energy transformation and technological innovation that has led to a more far-reaching set of challenges. As customer expectations and the ease of interactivity increases, companies will have to navigate a dynamic and complex energy ecosystem. To do so, players in the energy sector need to have a clear customer experience management strategy for how far they want to go to developing new products and services and deliver enhanced customer relationship mechanisms to match their initiatives. It is also important to note that an omnichannel customer experience management strategy must connect customers with relevant products and information at the right time, irrespective of the customer touchpoint.
Perhaps the full impact of strategy is best illustrated in this energy sector case study. This particular energy sector client aimed for operational efficiency to better predict their costs and be more competitive in the market and improve their overall experience. The customer intelligence experts at Infiniti Research provided a robust solution specifically designed for the European energy sector and included support for core business processes such as CRM, sales, digital online services, and advertising. The devised customer experience management strategy is compliant to current and future energy sector regulatory requirements, taking into account changes, such as process harmonization.
Driving the Customer Experience Management Advantage in the Energy Sector
About the Client
The client is a multinational electric power holding company. In order to identify newer opportunities, the energy industry player was looking at consolidating its operations in Central Europe and increase its presence in key emerging countries, such as Germany.
A robust strategy will offer exciting opportunities to businesses this year and the reason is simple- the companies that focus on customer experience reduce churn and increase revenues – leading to higher profits! Why wait? Request a FREE brochure to know more about customer experience management.
The Business Challenge
Ever since the differentiation of energy retailers from smart grid companies, the competition to attract new customers and retain them has been intense in the European energy market. As the players in the energy sector focus on expanding their global footprint, the value of customer experience management (CEM) within the sector is poised to hold a significant position in enhancing market value. Also, it is to be noted that energy sector companies that develop and innovate compelling customer experience management strategies will be forerunners in 2019 and beyond when all the European countries will be connected with their national data hubs.
The client- a leading player in the energy sector had been suffering a steady decline in market share since the liberalization of energy retailing policies 4 years earlier. Also, since new entrants piled into the energy market space, the customers could choose from more than 30 suppliers, out of which 15+ focused on price as the main competing factor. Despite their long history as one of the leading energy suppliers in Europe, the client found it challenging to adapt to the new environment and were on the verge of succumbing to its relentless price pressures.
With competitive pressure and switching increasing year after year, the energy sector client realized the need to adopt a better customer experience management strategy to improve customer retention and attract new customers. However, most of their efforts to do so were hampered by their brand image and the lack of a distinctive value proposition. Factors such as these furthered leveraged the difficulty to differentiate themselves from their peers. The client’s future as a multinational energy company looked dreary unless it could do something to stand out from the competition and reinvent itself. Factors such as these made them approach Infiniti Research to leverage its customer intelligence expertise and develop an effective customer experience management strategy to decrease switching rates and improve customer relationships and, at the same time, increase revenues.
Problem Statement 1
The need to assess customer experience and identify churn rates through an efficeint customer experience management strategy. With the digitization taking the forefront across industries, new digital opportunities are opening up for players in the energy sector to redefine their services, support decentralized energy production, and build deeper customer relationships by moving away from an asset-based focus to a more customer-centric focus.
Problem Statement 2
Challenges arising due to the ongoing digital transformations, regulatory changes, and new industry structures were a huge setback for the energy sector client owing to its impact on their outdated customer experience management strategy.
Problem Statement 3
The client wanted to transform their customer experience management strategy and develop a robust strategy that could be successfully embedded and scaled across their business operations.
Problem Statement 4
The need to comply with the European Commission’s initiative that focuses on reconciling energy consumption with the protection of the environment. Also, the increasing complexity and number of pricelists available in the market made it harder for the client to understand customer journeys.
Problem Statement 5
With the evolving customer attitudes, the client faced major challenges in positioning themselves in the evolving energy ecosystem. The client also was in pursuit of new revenue streams to scale up their position in the global energy sector.
Embark on the journey of improving your customer experience journey right now! Request a FREE Proposal for in-depth insights on customer experience management in the energy sector!
Solutions Offered and Value Delivered
Before the energy sector player could reinvent their customer experience management strategy, they needed to identify and systematically assess the root cause. By leveraging the use of customer intelligence we helped the client to conduct surveys that provided deeper insights into the customer journeys while emphasizing on critical customer journeys where churn was at its highest. To diagnose what went wrong we brought together a team of highly skilled customer intelligence experts and customer experience management specialists to perform an in-depth analysis of the client’s challenges.
This proved to be a major breakthrough and helped realize the complexities associated with every customer journey. It also helped reveal that shortcomings were not just associated with the handoffs between groups or their inefficient customer experience management strategy, but also depended on the quality of communications, which failed to provide key information across customer touchpoints. Armed with such granular insights on customer journeys the energy sector player was in a better position to reinvent their strategy through test ideas that involved customers to ensure the outcome would satisfy their needs. Forging bonds across functional boundaries and leveraging the involvement of the marketing, operations, and customer service teams helped us to add significant value to the customer experience management strategy.
The customer experience management solutions and recommendations were divided into the following four phases:
Phase 1: Creating a clear customer experience management vision
The initial phase in the development of a customer experience management strategy revolved around the creation of a clear customer-focused vision. It involved the formulation of a set of statements to act as guiding principles. Once the principles were in place our customer experience management experts focused on embedding it into all areas of training and development.
Phase 2: Understanding and creating an emotional connect
Phase two of this customer experience management engagement focused on understanding customer needs in order to be able to connect and empathize with the situations that they face. By creating different customer personas we helped the client to gauge the efficiency of their strategy.
Phase 3: Developing the framework for customer experience management strategy
The development of a robust framework in phase three took this engagement one step further by scheduling and tracking the client’s developments.
Phase 4: Measuring the ROI generated through the new customer experience management strategy
Measuring customer experience still remains to be a major challenge faced by players in the energy sector. Our customer experience management solutions helped simplify the entire process, helping the client save millions in revenue.
How much do you know about different customer types and are you gathering the insights and intelligence that can inform the optimal timing of your customer transformation journey? Get in touch for more information on how you can leverage Infiniti’s customer intelligence solutions to create a more personalized customer experience management strategy.
Since embarking on its new customer experience management journey, the energy sector client has won a raft of awards and recognition for its new customer focus, improved customer relationships and reduced churn rates. Putting customer experience management at the core of its commercial transformation process enabled the energy sector client to- reverse the decline in its market share, reduce customer churn, and improve profitability, with financial results increasing by more than €30 million. The devised customer experience management strategy was not a one-off effort but a means to design, introduce, and sustain a whole new way of enhancing customer relationships within the energy sector.
How can customer experience management impact the energy sector?
New customer expectations and opportunities in the energy sector are combining to shift the wider strategic context in which the energy sector operates. Though they are initiated from a number of different directions, regulatory expectations are changing with far-reaching energy transformation policies in several countries and significant momentum gathering in others. As a result, business models in the energy sector are changing and becoming more customer-centric and reliant on customer interactivity, throwing light on customer experience management. However, such factors are being continually underpinned by technological innovations that are transforming the choices of people and the way the energy sector can be managed.
The customer experience management impacts all areas of your business, but how do you get started? We provide you with examples and case studies to help you create a great customer experience management strategy. Contact us.