Technology is actively disrupting the utilities industry to create a better customer experience. This disruption includes offering new methods and technologies that aid utility companies not only in the new account process, but also in the bill payments and collections process, resulting in a better communication and payments experience overall. However, in order to help consumers become comfortable with these changes, it’s important to have a deep understanding of their current payments practices and preferences.
According to the ACI Speedpay® Pulse – a consumer billing and payments trends and behaviors survey of 3,000 U.S. adults responsible for two or more household payments a month – digital methods continue to lead transformation in the payments industry across all verticals, as consumers acclimate to utilizing newly available billing and payments technologies. This can be seen across digital communication options, payments channels and payments methods.
- A company’s website is the channel most frequently used (57%) and preferred (39.3%) for both one-time and recurring payments
- The use of a company’s mobile app increased from 2018, with 21.4% of consumers using this channel in Q1 of 2019
- In terms of payments methods, checking account deduction continues to be the most frequently used overall (60.1%)
- Digital billing statements are also gaining popularity among consumers (44.4%)
- Over the next 12 months, approximately half of consumers expect to use paper and digital billing statements with the same frequency, and many consumers expect to switch from paper to digital (21.7%)
Overall, consumers are becoming more comfortable with newer billing technologies and utilizing them when available. While this trend extends to the utilities vertical, those who pay utility bills are generally slower to adapt to the digital revolution.
Consumers frequently pay utility bills through a company’s website, a bank’s website, or via mail. However, unlike other verticals, consumers are more likely to pay utility bills using in-person payment options such as a brick-and-mortar customer service center or office. This preference has remained consistent from 2018 to 2019, and further confirms the fact that those who pay utility bills are slower to adapt to the digital revolution.
You might be wondering why, with all the digital options available, consumers would still consider in-person payments. Looking at the ACI Speedpay® Pulse data for one-time, in-person payment preferences can help shed light on this trend. When asked about their preference for paying utility bills in person, consumers gave the following reasons:
- Peace of mind (48.5%)
- Hardcopy receipt (41.6%)
- Security (38.6%)
- Convenience (29.4%)
- Efficiency (26.7%)
- Prefer to pay with cash (34.4%)
- Need to pay with cash (17.8%)
What does this mean for you as a utility provider?
We already know that consumers in general continue to slowly embrace digital billing and payments tools. To encourage use of other payments channels like digital and mobile offerings, it’s important to further educate utilities consumers on how these technologies can make their lives easier, emphasizing digital security measures and overall benefits.
Providers should continue to cater to consumer preferences by offering opportunities to pay in-person, however, it is equally important for utility providers to introduce new technologies while educating consumers. Holding open conversations about these new developments – answering their questions and concerns about these payment technologies – will help ease the digital migration.
How to Help Consumers Adapt to the Digital Revolution
There are benefits to both the provider and consumer related to digital payments methods, as well as challenges. The challenge as a provider is to keep up with the technological times by helping your customer base adopt the digital tools that are pushing the industry forward. Here are a few steps that ACI has found successful:
- Assess: Providers are encouraged to first determine that their customers are aware of the benefits associated with digital and mobile payment offerings. This can be accomplished not only with bill inserts, but messaging within every consumer touchpoint. Examples include: clear messaging on websites, messaging embedded in the IVR, talk tracks added to CSR scripts, signage displayed at walk-in centers and messaging during customer service center hold times.
- Benefits: Next, providers should outline the benefits that digital and mobile payment offerings afford customers. This may include, time savings, the convenience of paying anytime and the ability to pay anywhere. If benefits don’t exist, we suggest discussing this with the appropriate department responsible for your digital program.
- Communicate: Providers should then clearly and effectively communicate their digital and mobile payment offerings, as well as the benefits associated with utilizing these channels for payment via the touchpoints previously outlined.
- Educate: Long-term, providers should ensure they continually educate their customers on their technology offerings. Small technology changes can at times be deemed unimportant by a provider; however, to a customer these same changes could be sources of frustration or confusion. It’s important to educate customers on all changes and updates, and offer customer service assistance should they need it. In the long run, conversion to newer technologies almost always pays for itself.
By better understanding consumer preferences and practices, utility providers can more effectively test new strategies, with the goal of changing consumer behavior. Overall, converting customers to new technologies creates higher satisfaction and a more efficient payments process for both consumers and providers.