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UtilityCo* faced erosion of its long-established leadership due to regulatory changes that redefined marketplace competition. With more suppliers pursuing them, customers raised their expectations and took advantage of attractive offers, including improved pricing and more flexible energy products.
To curb the high customer churn rate in its retail business, Bain worked with the utility's CEO to improve customer loyalty through a comprehensive program, including cultural change.
In the utility sector, UtilityCo's decision to cultivate a customer-centric culture was a novel pursuit. Our team collaborated with senior managers on the development and implementation of a customer loyalty program, deployed across eight countries. The multi-year transformation was framed around Bain's Net Promoter System℠.
A Net Promoter System goes far beyond measuring customer loyalty with a reliable metric.
A Net Promoter System also establishes timely high-velocity feedback loops between customers and employees that help promote behavioral change, allowing the company to better respond to custom
Net Promoter Score® implementation across Europe:
Bain advised UtilityCo to implement a Net Promoter System, e.g. via the following steps.
- Benchmark performance against competitors in each country.
- Address individual transaction performance by using "closed-loop feedback" processes to learn and improve customer loyalty in near-real time.
- Quantify the economic benefits of customer loyalty.
The Net Promoter System earned substantial senior executive attention and top management followed through by strategically embedding it in the organization:
- It established a customer-centric vision by business unit and implemented corresponding strategic change plans;
- Management developed segmented offerings that better served customers and helped adapt local retail strategies;
- The Net Promoter System was broadened to also drive "internal customer orientation": internal pilots were implemented with major support functions
Results Delivery® capabilities of UtilityCo were strengthened to effectively implement internal and external priorities and to make program achievements stick.
With a customer loyalty-focused culture, the European utility is repositioning itself as an innovative competitor, offering more flexible pricing, products and services.
Customer loyalty is now embedded across the organization, from top managers to frontline workers—over half routinely receive Net Promoter® Scores and customer feedback. For UtilityCo, increased loyalty is delivering significant financial benefits, with a 10-year program net present value of several hundred million Euro.