The cost-of-living crisis: How can businesses better support vulnerable customers?by
The cost of living is soaring, and forecasts expect it to continue to rise, hitting vulnerable customers particularly hard. So what do you need to consider as part of a business-wide vulnerable customer framework?
Water UK has recently announced that it anticipates water bills in England and Wales will rise by 1.7%, an average of £7 per year, from April 2022. Along with other rises in the cost of living, including energy bills and national insurance contributions, this means that vulnerable customers need targeted support from their provider more than ever before.
The term “vulnerable” can mean many things - from financial hardship impacting day-to-day options, to physical or mental health concerns – and, unfortunately, not all households are receiving the support they need. Around 1.7 million people in the UK are currently living in ‘water poverty’ which means they spend more than five percent of their income, after housing costs, on this essential service.
Utilities need to exercise particular care when dealing with vulnerable customers. Some may struggle to understand financial matters, while other may have limited digital skills making them less confident in managing their affairs online, so providing a more personalised service can make a significant difference. Making better use of technology can help providers build more comprehensive customer profiles which, in turn, will drive more effective relationships.
Establishing a business-wide vulnerable customer framework will enable providers to manage how they engage with customers across the business. Something as simple as signposting on bills where and how to access support may be enough for some, while others may need greater intervention. All strategies should, however, be in line with the requirements of the Financial Conduct Authority.
Improve identification of vulnerability
In-depth training should be provided to all staff, while close monitoring will help to ensure they maintain the necessary knowledge, skills to meet and surpass customers’ expectations. Ongoing training will highlight the importance and fundamental principles of the business’ vulnerability strategy across all teams and departments.
Recording phone calls for training and monitoring purposes is one way to ensure standards are met. Recording and assessing at least one call per week per employee will highlight any performance concerns which can then be addressed with further training to develop skills and knowledge. Similar measures should be introduced across all communication channels to ensure a consistent approach as it is often found that those who are financially vulnerable are comfortable using online chat facilities such as via a website or Facebook Messenger.
Sophisticated use of data sharing is also helpful when identifying and supporting vulnerable customers. Providers should be increasing the information held about customers to improve the identification of those in need of financial support. Information should be shared between water companies to allow for any support measures to remain in place if the customer moves residence within the operating area of the service provider.
Communication is a vital strategy to define and build relationships between water providers and their customers. All communications must be clear, fair, and not misleading, whether written or oral.
In the recent Consumer Council for Water, affordability review, vulnerable customers identified some key communication barriers to them seeking help and feeling supported. The majority of respondents described the relationship between customers and their water provider as distant, with contact with their water company being minimal for most. This perceived distance can lead to low awareness of available support, a lack of trust, and prevent some customers from feeling that they can ask for help.
To improve communications water providers should offer different forms of communications dependent on the preferences of their customers. There is a particular preference amongst younger people to manage everything online, with 65% of Gen Z bill payers stating digital engagement is their preference for communication with their water provider. Providers should also be considering the accessibility of information. In the Consumer Council for Water report, vulnerable customers stated that they would like to see information about water bills and providers in supermarkets, community centres, job centres, and local charities. Evidently, water providers need to develop a targeted communications strategy to reach vulnerable customers which go beyond digital communication channels.
Offer a wide range of support
Companies should have a wide range of support options available, but communications must be tailored to ensure the specific needs of the customer are met which may mean putting multiple support systems in place over the short or longer term.
A payment break can be an effective short-term solution for those struggling through a specific issue, perhaps relating to COVID-19. However, if providers want to offer longer-term support, payment matching could be suggested to allow customers to contribute whatever they can afford whilst also having the satisfaction that they are making an active contribution.
Clearly signposting the support that is available on websites or in communications is essential, but providers can also put vulnerable customers in contact with charities and specialist organisations to help them with financial concerns. WaterSure from Citizens Advice helps vulnerable customers by capping their water bills. Signposting to the relevant organisations means customers can have someone by their side to help them come to the right decision for their personal financial situation.
With the expected upcoming rise in water bills, water providers need to implement a strategy to support their most vulnerable customers through this difficult time. Taking steps to improve communications and offer support services will lessen the burden of water bills on vulnerable customers in the face of significant changes to the cost of living.