Digital Transformation for Utilities: Creating a ...

1 Digital Transformation for utilities : Creating a differentiated customer experience through mobility In today s deregulated marketplace, utility companies can gain sustainable competitive advantage by embracing a mobile-first mind-set to differentiate the experience they deliver to customers. Read on to see our framework for getting there. Executive SummaryIt s hardly news that the unrelenting conver-gence of communication and computing capa-bilities in mobile consumer devices is transform-ing customer experience and user expectations for nearly every service and function across fact, smartphone subscriptions will achieve a compound annual growth rate (CAGR) of 25% between 2010 and 2020, according to the Ericsson mobility While only 10% of the global mobile phone subscriber base had smartphones in 2010, by 2020 penetration is set to reach 70%, or billion subscribers worldwide.

2 This change in consumer behavior, complemented by the rapid evolution of mobile operating systems (OS) and product features, has resulted in a new multi-screen world. For both sequential and simultaneous screening, smartphones have become the backbone of daily media interactions for most consumers. Conven-tional wisdom says smartphones are the most used computing/communications device on a daily basis and are the common starting point for users multiple screen modern Digital technologies influence customer experience , expectations and behaviors, the utilities industry needs to respond in kind. This white paper explores the opportunities and proposes a framework for utility companies seeking to transform their business by taking advantage of mobile-first thinking and multi-screen preferences to create tangible differentia-tion in a crowded of the Multiscreen WorldIn today s multiscreen world, context drives the choice of device.

3 The decision is affected by time of the day, objective to be accomplished, location of the user and the user s state of mind. On an average, 38% of daily interactions with the Internet happen via mobile. Mobile s emergence as a preferred screen is the result of its on-the-go convenience and growing commu-nications and connectivity capabilities, as well as users lack of time to use other devices. In this multiscreen world, most users have strong cognizant 20-20 insights | september 2016 Cognizant 20-20 Insightscognizant 20-20 insights2preference for mobile to either initiate contact or accomplish an objective. Figure 1 uses Google research2 to explain why users prefer multi-screen engagement, while demonstrating that mobile is the most preferred point of initiation for all online Mobile as a Primary customer Engagement Channel and Ducking the Delete Syndrome This dynamic shift in consumers Digital behavior has triggered a strong realization among utilities that they need to pivot towards mobile as a key element in their Digital strategies.

4 However, most companies have yet to fully embrace mobile as a self-service channel. According to the Power and Associates 2016 Utility Website Evaluation Study, although many utilities have extended their mobile offerings, most customers are not satisfied with their Out of all utilities companies in the , approximately 29% have dedicated apps, leaving a large upside for tighter customer engagement and satisfaction improvement. Companies that do not have dedicated mobile apps offer mobile-enabled websites to deliver a mobile-optimized experience . There are 136 investor-owned utilities (IOUs) in the , held by 69 major utility companies of which 17 are in the West, 20 in the Midwest, 16 in the South and 16 in the Northeast.

5 Our analysis shows that the geographic distribution of utilities that have a dedicated mobile app for customer service varies from to averaging 29% for all of the (see Figure 2). According to customer reviews, most of these apps have failed to live up to user expecta-Starting Online with the Smart PhoneSource: Google Figure 1 Dedicated customer Service Mobile Apps by RegionFigure 2 utilities - 16 Apps - 6 utilities - 20 Apps - 5 utilities - 17 Apps - 4 utilities - 16 Apps - 5 THE MidwestWest Search Activity60%65%4%Browsing58%63%5%Online Shopping61%65%4%Travel Planning 45%47%3%Banking and Finance56%59%3%Social Networking58%66%8%Location of UserObjectiveState of MindTime of UseCONTINUED ON PCSCREEN ENGAGEMENT SCREEN ENGAGEMENT SCREEN ENGAGEMENT <>STARTED ON MOBILECONTINUED ON TABLET24%38%9% Use in office and home On-the go and home Used in office Task-oriented Communicate and connect Entertainment and browsing Serious and

6 Research intensive attitude Need quick info Relaxed and leisurely approach Requires lot of time and focus Short burst of time available Unbound sense of timecognizant 20-20 insights3tions. Apps built on the Android platform have better ratings compared to those that run the iOS operating system. The average rating for an Android app4 is while it is for iOS apps. iOS apps5 received a below average rating on customer experience , according to our analysis. User ratings in both platforms are found to be skewed towards the average, leaving a major opportunity for improvement. This disconnect with users results in the inevitable: The utility app is among the first to be deleted.

7 So, how can utilities duck the delete syndrome? While conceptualizing their mobile service and engagement channel, utilities need to understand the synergies across channels. They also need to ensure their overall Digital strategy is built on a meaningful and relevant customer experience . Another pertinent question to ask early on is the purpose of the mobile app. Existing mobile apps in the market can be classified into two buckets (see Figure 3). The first bucket includes transactional apps built to help a customer complete a transac-tion from a mobile device. The second is the trans-formational group and consists of engagement apps that are built to encourage and maintain user adoption.

8 utilities should look at features that help engage customers and drive meaningful It is important to get it right from the start, and then enhance key capabilities over time. This drives the long-term adoption of the is essential to identify the key customer engagement and transactional feature for the mobile app in the strategic planning phase. Along with the regular transactional features, it s important to focus on critical customer engagement functions such as empowerment tools, necessary tips and gamification (see Figure 4, page 4).Figure 5, on page 4, offers a few examples of winning features that can make utility industry mobile apps7 into an exceptional user Move to Mobile as a Self-Serve ChannelDigital platforms and devices have become an integral part of our lives across industry segments, and will continue as such for the foreseeable future.

9 We do so much online now buy stuff, plan holidays, manage funds and frequently from our suggests that utility companies lag behind other industries in the adoption of Digital technologies, and particularly so in the mobile Strong regulatory controls and lack of incentives for competing in the Digital space have kept utilities away from embracing Digital technologies as much as other industries have. In recent times, however, rising costs of acquisition and competition in the deregulated market have incentivized utilities to look towards adopting customer -connected technologies. With the advent of smart grids and free markets, utilities are undergoing not only a technological shift but also a strong shift in customer dynamics.

10 With this shift, the voice of the customer and driving Transactional and Engagement Features: An Illustrative ExampleFigure 3 TRANSACTION FEATURES: Contact Us Login My Balance > Account Balance > My Energy Use > Payment Arrangements > Online Payments > Service Order Status > Outage/Gas Leak Status Account Alerts ( , Bill Due, Overdue, Outage Alerts) Outage/Emergency ReportingENGAGEMENT FEATURES: Personalized Tips and Advice Related to Energy Efficiency and Clean Energy Decision-Making Tools Like Best Rate Selector or Useful Add-On Savings Gamification Like Goal-Based Savings Target and Incentivization or Games Linked to Energy Proactive Alerts and Notification Including Weather and Storm Advisory Active Outage and Storm Emergency Support Social Media Connectscognizant 20-20 insights4 Figure 4 Key customer Service Functional Modules and Activities.