The Utility Week Customer Summit is always a great opportunity to meet with our clients, build relationships, and hear from speakers across the sector. This year, I attended with my colleague, Dayle Hutchinson, Business Development Manager at Lowell, and we both felt that the insight shared was invaluable - particularly given the challenges the industry and consumers are facing with the cost-of-living crisis.
Increasing customer concern
Concern for customers was a consistent message throughout the day. The current crisis, amplified by the introduction of the impending price cap increase on the 1st April, leaves none of us in any doubt about the impact on customers both within the utilities sector and for our customers at Lowell.
In their remarks, Phillippe Commaret, EDF's Managing Director of Customer, and Michael Lewis, Eon's UK CEO, both pointed out that they have seen an increase in customers contacting them about pricing, and many indicating they were unable to pay the increased rates.
Volatility in the market
Neil Lawrence, Ofgem's Director of Retail, described the current situation as "a dark moment for the industry." However, it's wider and more concerning than that, with other vertical sectors offering credit also being impacted with the squeeze on customer's disposable income.
Only time will tell, but with an acceptance that the price cap as designed is not fit for purpose, it appears inevitable that the utilities market volatility will continue. There are further changes due in October and discussion in the room was that additional increases beyond that are likely.
A resounding rallying cry was heard from both providers and regulators for the Government to intervene and reform, but this is yet to materialise. The extent of the problem both customers and the industry face are difficult to summarise given there are so many external components surrounding the price increases. The magnitude of which has left an impression on me, as we consider those who will likely become a customer of Lowell, who haven't been in this situation before.
We are all affected
The concern is not just about the inability to pay energy bills, as I previously mentioned it is larger than that. It affects us all, both as industry professionals and as consumers. The knock-on effect will undoubtedly be huge. As a nation many of us are still working at home, meaning electricity and broadband are essential. Therefore, alongside those who are unable to pay their utilities, we are likely to see higher levels of arrears across the financial services, retail credit and communications sectors.
Whilst initiatives such as smart tech, solar panels, and heat pumps are in place, sadly these are not really solutions for customers with lower levels of income. Even so, the savings are minute in comparison to the cap increases. This is something that was brought to life by Warren Buckley, Retail Director of Thames Water and the chair of Citizens Advice Bureau who are already seeing 42% of customers on Universal Credit left with no money at the end of the month.
We have a duty of care to our customers, and it was a pleasure to hear from Andrew McMillan, the former head of Customer Services at John Lewis speaking about consistently trusted brands. It was his reference to the Ritz Carlton's old motto which resonated with me most, enough to title my blog in fact - Welcome, wanted, remembered, and cared for.
I'm not someone who would typically write a blog post, but after this event, I felt compelled to do so. The energy crisis will impact many people, friends, family, colleagues, and it is imperative that we, as organisations with affected customers ensure that when they contact us, they are welcome, wanted, remembered, and cared for.
There will undoubtedly be more customers who find themselves in vulnerable situations, it's unavoidable. However, I take solace that when these customers do engage with Lowell, there will be great people to talk to when they want to and great technology to support them when they don't. This specific line around having channel choice is another point that resonated from Andrew McMillan's presentation.