Want to drive your bottom line? Increase brand trust
New research from Cogent Reports, a division of Market Strategies International, has identified a link between brand trust and monetary value. Brand trust is critical for strengthening the overall relationships that utilities have with their customers, and can generate significant value to a utility’s franchise.
|Click on image to enlarge. Credit: Market Strategies International|
The 2014 Utility Trusted Brand & Customer Engagement study — based on a survey of 19,000 residential utility customers served by the 125 largest natural gas, electric and combination utilities in the United States — provides a holistic view of the complex relationship consumers have with their utility providers, by including measurements for brand trust along with operational satisfaction and product experience.
“By earning the trust of their customers, these companies are creating financial value in their brands,” said Chris Oberle, a senior vice president for Market Strategies and lead author of the report. “While about four in 10 utilities in our survey are designated as Most Trusted Utility Brands, an even more select group of just 15 manage to achieve brand trust scores of at least 700 out of a possible score of 1,000.”
In a hypothetical utility-switching exercise, the report showed that greater incentives would be required to induce a change among customers of utilities with high trust.
“Based on these findings, we estimate the current goodwill value for scoring high on trust to be over $8 billion. This shows a significant financial benefit for the industry to focus on raising trust levels,” said Oberle.
The report also shows that customers of utilities with strong brand trust tend to enroll in more programs and are far more prone to making positive comments on social media and elsewhere about their provider.
“The bottom line is, trust pays,” said Oberle. “By focusing on brand trust and getting it right, a utility can and will increase its franchise value.”
Florida Power & Light is the nation’s most trusted electric utility and receives the highest overall brand trust score (724 points out of a possible 1,000 points) of any utility, according to a separate list of 52 utilities categorized as most trusted brands in each of 12 regional and industry segments released by Cogent Reports. NJNG is the most trusted natural gas utility in the eastern United States and receives the highest overall brand trust score (710 points out of a possible 1,000 points).The list also recognizes Oklahoma Natural Gas as first in trust among gas utilities nationally, while MidAmerican is the most trusted combination utility provider.
The Brand Trust scores are developed by combining company ratings on 28 separate measures in six areas: concern for customers, company reputation, credibility, dedication, environmental performance, and community involvement. Trust factors are then combined with operational satisfaction and product experience measures to generate a single overall Engaged Customer Relationship measure for each utility. Overall performance and tier structure vary by region and type of utility, with all companies named achieving a minimum threshold score of 650.
– see this fact sheet