The energy market is renowned for its bad reputation. Consumers love to hate energy companies and every other week there seem to be headlines highlighting the spiralling cost of energy and the profits of the so called “big six”.
That’s not to mention the recent investigation by the Competition and Markets Authority. The findings, released earlier this week, suggested that energy customers are paying too much, that most don’t switch suppliers and that the big six energy companies are “exploiting such a position through their pricing policies”.
Energy companies have an image problem, that was why in 2010 EDF Energy hired former Procter & Gamble marketer Stead, tasking him with undertaking a review of the business. During that process the clear finding was the “trust gap” between the energy industry and consumers.
Some 62% of people thought their energy supplier was benefiting at their expense, according to its research. A further 86% said there was a need for an energy company that put the customer first.
That led EDF to put a strategy in place that Stead said was “customer led” and put an emphasis on trust and safety. He claimed that what made EDF different was that it put “its money where its mouth is”.
“There is a lot of rhetoric in the industry, a lot of people talking about trust but when you peel back what is happening there isn’t necessarily substance behind the words. What sets EDF apart is that this wasn’t a comms initiative, it was at the heart of our business strategy,” he said.
In 2012 EDF relaunched the brand with a customer commitment to deliver three key things: to offer better service, fair value to customers and deliver simplicity. Its flagship product was the Blue Plus Price Promise – its low carbon energy tariff.
Impact of the marketing changes
Stead said a key tenet of its brand was that it promised to tell customers if they could save money elsewhere and that there weren’t termination fees for leaving. That, he said, has led to very loyal customers and higher NPS scores.
“Customers rate us more highly on trust than before and tell other customers about us. Plus they can name our tariff, we’d never seen that before. Building the EDF energy brand and starting to brand the product proposition was a key driver,” he said.
Since 2010, Stead claimed EDF has managed to deliver significant market share growth in a declining market. In the early 2000s the big six held a 99% share of the market, that has now been eroded down to about 87% and there are now 26 suppliers on the market.
“In that context the results are all the more impressive,” he said. “Consumers are voting for us as one of the major players.”
He also said there has been an increase in brand perceptions – customers having more confidence in EDF – and that in its customer feedback responses say EDF is a supplier that “stands out as a force for good within the sector”.
His comments are backed up by data from YouGov’s BrandIndex. Over the last year EDF’s Index ranking, a measure of a range of metrics including value, impression and quality, has increased to -2.2 a statistically significant rise.
Buzz is up too to -1.4, from -5.3 a year ago. It now sits at second across almost every metric and top in terms of Impression.
Building an energy brand people can love
Despite EDF’s improved image, the brand, and the rest of the big six, still remain pegged to the bottom of YouGov’s list of 45 utilities companies. EDF’s rankings are in negative figures across almost all of the metrics. Its brand perceptions may have improved but there is still a long way to go to rebuild the reputation of the industry.
Stead said it is possible to have a utilities brand that people love if they invest in doing the right thing and the customer experience.
However he accepts that more needs to be done to boost the reputation of the industry. He sees the CMA investigation as a chance to “really clear the air” and an opportunity for the industry to look very carefully at the findings and take whatever action is required.
“We hope as EDF Energy to be recognised as doing the right thing for customers but things need to change at industry level. The complexity around pricing, the way the market is set up and regulated to offer different prices is a barrier to engagement. That requires collaboration.
“Increasingly we want to talk about things other than price. If we can clear that up we can make it easier to compare who is doing the right things, who has the best customer experience and service. That is where we are preparing to be.”
Martin Stead, sales, marketing and digital director, EDF Energy
The marketing roadmap
Don’t expect any big changes in EDF Energy’s marketing strategy going forward. Stead said it aims to continue growing market share by “being fair, doing the right things to build trust and being proactive in communications with customers about the best deals so they are able to make simple choices”.
There will be a shift to more digital with a significant investment in areas such as smart meters, its website and mobile apps. EDF is also looking at new ways it can be innovative after it was the first company to offer photo meter readings.
EDF is also playing in the big marketing trends – looking more to content and using VoD, programmatic and pay per click to drive sales.
“This is a sector that is not liked or trusted. We find that challenging but we do think we are doing things differently and we have proof. The fundamental challenge is to break free from the ‘big six’ and be seen as different,” he said.