British Gas to energise marketing after customer churn stablises

British Gas is targeting a return to customer growth in the coming months through cheaper priced products, services and a new tariff after claiming recent marketing initiatives helped convince people to stick with the business.

British Gas social media 1
British Gas credited recent marketing activty for helping to stabilise customer churn in the first half of 2014.

The country’s biggest energy provider said it is “simplifying” several “key residential customer interactions”, in particular for direct debit payments and moving home. To support the plan, its new billing and CRM platform will be used for all residential customers by the end of the year.

“Competitively” priced products, “innovative new propositions” and the trial of its smart meter-enabled “Free Saturdays and Sundays” energy tariff are also on the way, the company said. The new tariff will offer free power to its one million customers who have smart meters at the weekend when there is less demand from businesses.

British Gas says smart meters will bring “significant” customer benefits to the brand, including an end to estimated bills, greater ability to monitor and reduce consumption, flexible use tariffs, and simpler and faster switching between suppliers. A smart connected boiler is currently being trialled, while the company also plans to launch a “virtual in home display” next year.

It is hoped the investments have a knock-on effect on the number of customers interacting with the brand online. Around two-thirds of British Gas customers uses its services through digital channels, with around half of those from a mobile or tablet device. The energy firm has previously announced it is overhauling its marketing division in response to the shift, a move it hopes creates a more integrated customer journey that can ultimately boost conversions.

The marketing push comes as the brand looks to kickstart growth following a mass exodus of more than 400,000 customers since the start of 2013. Customer account numbers stabilised at 15.1 million in the three months to June, after a 1 per cent drop in the previous quarter.

British Gas hailed the marketing investments made so far in 2014 for lifting customer service, including new price fixed tariff options at the start of the year.  

The energy firm predicts the average domestic bill will be lower than last year, thanks to mild weather and a freeze on energy prices tugging down profits down 26 per cent in the first half of the year.

Energy brands are ploughing more funds into growing their customer service proposition ahead of the findings from a competition review. It is expected to call for greater price controls on energy tariffs, which will force the company’s to rely less on price-based promotions and more on service-led initiatives. E.ON is ramping up its digital efforts to spearhead the charge, while SSE is working on a new marketing strategy it hopes will spark a more emotional response from consumers.