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British Gas beats BT in the utilities price war

Stephan Shakespeare
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IT seems that British consumers are very sensitive to the details of their arrangements with their utility suppliers. This week we compare one utilities company that has benefited from this (British Gas), and one that has suffered (BT).

It appears that British Gas’ announcement of a seven per cent price cut for all households has contributed to a steep rise in its Brandindex “Buzz” score.

This will be the third price cut that British Gas has introduced in the past 12 months, and is related to the fall in wholesale gas prices during 2009.

The British Gas “Buzz” score remained relatively stable around -5 since the start of the year, until 4 February, the day after the company announced its price cut. Since then, the Buzz score has risen by 19 points over 22 days, finishing at a high of +14 on 26 February.

The company has also released an iPhone application which allows customers to input their meter readings quickly and easily.

The other major energy companies will be under pressure to follow suit and pass on their savings to consumers, or risk losing customers looking to save money on their energy bills.

Meanwhile, BT is changing the times at which UK customers can start to make free evening phone calls from 6pm to 7pm. The brand has also been plagued by negative publicity surrounding falling share prices and “substantial concerns” by the Pensions Regulator about its pension deficit.

BT might have hoped to deflect attention from their new call times arrangement by the launch of new broadband packages, but BrandIndex shows that their customers are becoming steadily less satisfied – BT’s “Satisfaction” score fell from +5.5 to +1.5 in just two weeks. Exciting new services are important to a brand, but consumers are just as sensitive to the details of the service for which they are paying.

Stephan Shakespeare is co-founder and co-chief executive of YouGov.