North American utility companies continue to give birth to their e-business plans amidst dot-com funeral processions. Part of that plan includes a focus on CRM, integrating traditional business functions and systems with the Web and determining what Internet services are needed, according to the latest study of electricity and natural gas markets from utility industry publishing company Chartwell Inc.
The study, "Chartwell's Guide to E-Business in the Energy Industry 2001," noted that the Internet as another customer-contact portal is gaining popularity. Almost 18% of energy companies give customers the option of signing up for service online, while 27% are planning to offer online sign-up. Additionally, some companies albeit a small percentage provide Web-enabled customer service via live chat with customer service representatives.
"With the markets in the shape they're in [and] the volatility... utilities have to make a good impression," said Dennis Smith, Chartwell's editorial director.
As utility companies have realized that customers are increasingly important, the forward-thinking utilities have begun to use the Internet as another customer contact point, Smith said. This ranges from basic self-help activities to allowing customers to order products and services online, input their requests for service and talk to representatives online, he said.
All these activities are equally important for utility companies, Smith said. "In running a company, is marketing more important than operations?" he asked.
"Utilities are striving to put on a better image for customers," Smith said. Utility companies are not only integrating call centers with the Internet but with the sales department as well, he said.
"A caller wants the customer service representative to have updated information in front of them," Smith said. "If [the customer] just purchased a voltage regulator or hot water heater [online], ... it doesn't sound good if a customer service representative tries to cross-sell the customer a hot water heater."
"In order to maximize the Internet to its full potential, energy utilities will have to integrate it with day-to-day operations," Smith said. Even an automated message to reply to a customer's e-mail query is a step toward maintaining customer relationships, he added.
With the current deregulation of utilities, occurring on a state-by-state basis in the United States, energy utility companies face stiff competition from marketers that can sell, for example, electricity over wires that the utility company itself maintains. For the states that haven't deregulated utilities, the companies "want to get in good with their customers ahead of time," Smith said.
"Customer satisfaction is a big challenge" for utilities, Smith said. Systems integration is another challenge that energy utilities are facing as they implement their CRM strategies.
In their e-business endeavors, utility companies also are challenged to encourage customers to participate, Smith said. For example, many of the larger utility companies in urban areas offer online bill payment, but not many customers are using it, he said.
"The number of utilities offering e-commerce did not increase [a lot] from last year," Smith said. "Other than electronic billing... Internet-based activity stayed the same. It shows that [utility companies] are still getting their overall strategies in place."
"We did see an upswing in customer contact," he added.
One of the companies that implemented a customer contact center was Michigan Consolidated Gas Co., which Chartwell used as a case study in the report.
"We've incorporated all of our routine transactions that we do on the phone" into the Web site, said Julie Maher, marketing communications specialist at Michigan Consolidated Gas. These include service turn-on and account information requests. Information is pulled off the registration site, according to Maher, and then followed up with calls or e-mails from customer service representatives regarding the requests or orders.
Additionally, Michigan Consolidated Gas conducts an online survey through Web-based survey conductor Zoomerang.com with customers that have used the online customer center. It measures the response time of customer service representatives, the quality of information received and the likelihood of repeat usage. So far, Maher said, the response from customers has been very positive.
"Customers are pleased [with the system] because it beats phoning in and being [put] on hold or waiting in line at a customer service office," she said.
Michigan Consolidated Gas hasn't used any off-the-shelf products for its customer contact center, Maher said. The Web site forms are common gateway interface (CGI) scripts, and the company uses an outside vendor, part of its advertising agency, for technical and Web support.
One of the challenges of deployment was having the customer service representatives adjust to the new method of communicating with customers, Maher said. Once the representatives did get used to the Internet contact, however, they found that it was a time-saver.
In the future, after the pending merger with DTE Energy Co., Michigan Consolidated Gas plans to offer answers to queries in real-time and provide electronic billing access, which Maher said will be able to occur once the merger is complete.
Chartwell surveyed 100 utility companies for the study, speaking to an employee involved in the company's e-commerce operations about what products and services the company offered over the Web. The companies included investor-owned utilities (48%), co-ops (19%), municipal or city energy utilities (26%) and uncategorized utility companies (9%).
Varying in size, 43% had a customer base of under 100,000; 32% had 100,000 to 500,000 customers, and 25% had a customer base of over 500,000. Forty-four percent of the companies surveyed were electricity-only; 13% offered electricity and water; 10% offered electricity, gas and water; 21% offered electricity and gas; 11% were gas-only, and 1% offered only water.
For more information, visit Chartwell's Web site.