Cognizant 20-20 Insights

Social Media for Utilities: Developing a Satisfying Customer Experience

By creating a dynamic and responsive social media presence, utilities can enhance customer interaction and influence key decisions, turning dissatisfied consumers into advocates.
Executive Summary
Customer engagement continues to be among the top concerns of utilities executives worldwide. As consumers flock to social networking platforms such as Twitter, Facebook, YouTube and LinkedIn to connect with each other and with businesses of their choosing, utilities need to incorporate social media as part of their broader customer engagement programs. Doing so will help improve the current relationship that many utilities have with their customers.1 Today, however, most utilities are taking a cautious approach to embracing social media, as they fear the backlash of negative commentary on these social forums. In this white paper, we demystify the progress that forward-thinking utilities have made in using social media to more effectively engage with their customers. In our view, utilities that embrace social media will benefit from increased customer satisfaction. This paper offers a holistic perspective on social media strategy development, customer sentiment analysis, tactical execution and monitoring, and integration with enterprise customer relationship management (CRM). It also offers recommendations for engaging with customers in more relevant ways and meeting their ever-increasing demand for two-way communication.

Social Media Trends in Utilities

Although the utility industry as a whole lags behind other industries in adopting social media, individual utilities remain intrigued by the prospect. In the U.S, the use of social media among utilities is more established than in the UK and Europe, where social media usage only recently started to take off. According to a Pike Research 2012 report, the top two reasons that customers communicate with their utility providers through social media channels are billing issues and the need to obtain information about a utility service or program (see Figure 1, next page).2 Many utilities have ventured into this space to discuss energy conservation and efficiency, customer education, branding and promotion, and outages. Social media is gaining acceptance as a viable means of delivering vital communications, customer service issues and promotional offers. Other areas where utilities are using social media can be found in Figure 2, next page.

Implementing a Social Media Program

We have developed a four-step approach to enable utilities to implement an effective social media program (see Figure 3, page 3).

cognizant 20-20 insights | january 2013

Social Medias Emerging Consumer Imperatives

Billing issue Obtain information about utility service or programs Praise about service Service outage Service issue other than outage Schedule a new service installation Complain about service Other 0 5 6.8% 10 15 20 25 30 35 11.5% 19.2% 16.4% 15.1% 31.5% 31.5% 24.7%

(Percent of respondents)

Base: 73 U.S. consumers Source: Social Media in the Utility Industry Consumer Survey, Pike Research, Q1, 2012. Figure 1

Step 1: Think Beyond the Meter Utilities need to look beyond the meter at the customer premises and create an interactive communication channel through the use of social media. Via social channels, utilities can begin to reconnect with customers by replying to issues and responding to negative comments. The connecting power of social media can act as a com-

plement to, not a replacement for, more traditional channels, such as customer care, e-mail, online forums, interactive voice response systems, etc. Social media connections can be driven through the following approaches:

Initiate conversations: Utilities should initiate

a two-way channel, with which they interact

Utilities Social Media Priorities

Crisis Communication Customer Education Customer Service Energy Efficiency Demand Response Green Energy Promotion Branding Recruitment
Description: Outage management and storm information is communicated in real time, such as on Twitter. Examples: Dominion Virginia Power, Public Service of New Hampshire, Pepco Description: Educate customers through YouTube and Facebook on topics such as recycling, renewable energy, energy efficiency, etc. Examples: Florida Power & Light, Xcel Energy, Nebraska Public Power District Description: Launch a social media Web site to serve customers through Facebook, Twitter, YouTube, blogs, etc. Examples: Reliant Energy, Centrica, Kentucky Public Service Commission Description: Use of social media to engender energy saving behavior and educate on climate change issues and energy efficiency methods. Examples: Apps like Social Energy App, JouleBug, Facebook App Description: Platform for realizing the goal of demand response programs, which encourage and incentivize customers to reduce demand during peak periods . Examples: Opower developed a Facebook app promoting an energy-saving competition among friends. Description: Market-renewable energy service options, tapping the younger generation for green energy and carbon offset programs. Examples: Duke Energy, Public Service of New Hampshire Description: Platforms to monitor utilities brand value and for marketing-related activities. Examples: Nebraska Public Power District has created a Facebook page to use for branding purposes. Description: Use of LinkedIn to advertise positions and recruit employees. Examples: Southern California Edison, Xcel Energy, Progress Energy

Source: Various industry reports 3 Figure 2

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Four-Step Plan

Think Beyond the Meter

create a word-of-mouth following. To enable this, utilities need to enlist their employees and influencers to help create and distribute key messages. Tools that allow amplification include:

>> GaggleAMP, a platform that allows compa2

Tap Social Media Analytics

4
Integrate Social Media with CRM

Approach to Implement Social Media Program

nies to amplify their social messaging by leveraging employees, customers and partners. ers to automatically create word-of-mouth referrals and traffic through Facebook, LinkedIn and Twitter. individuals to promote campaigns and blog posts.4

>> SocialToaster, which helps recruit support-

Transform Customer Engagement

>> Spread.us, a Twitter-only tool that allows

A simple analysis of the strengths, weaknesses, opportunities and threats (SWOT) will help utilities understand the importance of analyzing social media (see Figure 4, next page). Utilities should perform a detailed SWOT analysis based on their particular business strategy and priorities. Step 2: Tap Social Media Analytics, Monitor Customer Sentiments Utilities can act on the derived intelligence obtained from the multiplying pools of unstructured social media data to improve business results, increase brand awareness and polish their reputations. They can achieve these goals by responding to and managing crises and outages, communicating energy efficiency programs and engaging in initiatives such as online cross-selling and marketing, customer satisfaction and advocacy. Utilities can also use sophisticated analytics tools to harness the power of social data, although such tools are in the early stages. Making Sense of the Noise For utilities adopting a social media analytics strategy, it is imperative to evaluate the maturity of social media usage across different business units within the organization. This requires a consultative approach, with a detailed assessment of present-state social media adoption maturity, capabilities for adopting new technologies, a perspective on implementation feasibility and a close assessment of budgetary constraints. The real value of social media can be derived from integrating real-time insights from unstructured data with enterprise business intelligence and customer relationship management platforms to advance proactive decision-making.

Figure 3

not only with meters but also directly with customers. New programs and features can be easily communicated informally among customers, with the help of functions such as the like feature on Facebook. Twitter can be used as a communications medium with customers during outages and other crises, such as conveying storm information.

Drive

conversations: One of the most important aspects of blogging is to build a community in which utilities experts can answer customer questions. Utilities experts can provide advice and information on smart meter advantages and capabilities, electric vehicle charging tips, reducing energy consumption, insulation, energy efficiency, power reliability, outage reduction information, etc. A rapid response can turn disgruntled customers into ambassadors for the utility. Moreover, because these interactions occur on social media, its open for the public to see, which can enhance the companys reputation for transparency and responsiveness. conversations: Utilities can create a social mashup, a simple Web-based application that combines content and functionality from a variety of sources through highly compatible and simply installed Web plug-ins. This approach ensures a continuous information feed that alerts customers to tips for reducing energy consumption, using smart appliances, restoring power and other related information. companies to re-distribute messages and cognizant 20-20 insights

Spread

Amplify conversations: Social media enables

Sample SWOT Analysis

Favorable Strengths Internal Unfavorable Weakness

Huge source of freely available information. Proactive engagement with customers; faster

resolution of issues and queries. Real-time communication updates on energy efficiency, product launches, crisis management. Improved relationship between utilities and customers.

New mode of communication. Requires urgent effort to mitigate negative

image and mistakes. Return-on-investment is difficult to recognize. Requires a dedicated team to look into customer grievances.

Strengthened reputation for transparency and

customer-friendliness. customer trends.

Need to align social media strategy with legal

and regulatory compliance. exposure. ethics.

Ability to listen and respond proactively ahead of

External

Risk of damaged brand image due to high Risks associated with security, privacy and

Ability to measure customer pulse informally and

analyze customer sentiments.

Increased online cross-selling opportunities. Easier exploration into new markets, such as
Internet-savvy customer segments.

Opportunities
Source: Cognizant Figure 4

Threats

Utilities can derive value from the large amount of unstructured, free-form text driven by the conversations and sentiments (positive, negative and neutral) expressed across various social media platforms. This will help them align their customer engagement strategies by listening, monitoring and acting in real-time to meet consumer requirements. Unstructured text includes comments posted on social media platforms and other blogging sites, customer care notes and customer survey responses. Framework Development for Data Analysis We have developed a social listening framework to analyze and make sense of proliferating social chatter. Using this framework, utilities can collect, process and analyze data, as well as deliver actionable business insights. Social listening and analysis is performed on the information gathered from social media, particularly from public pages, forums, blogs, news, review sites, microblogs or any publicly available data from social channels. The framework encompasses a five-step method for generating social media data insights (see Figure 5, next page):5

1. Identify and crawl social media sites and local

consumer forums to capture relevant posts and filter out the non-relevant ones.

2. Listen and extract key information on products

and services, energy efficiency plans and new services and symptoms, using algorithms, clusters, filters and taxonomy.

3. Analyze and find relevance within business

contexts, relationships with company programs and issues using different analytical models and sentiment analysis.

4. Act and report business attributes and metrics

on influence, sentiments, volume and demographics, etc. to derive actionable business insights.

5. Integrate and monitor analyzed information

within the enterprise database for continuous insight and customer sociability. Social business analysts at the command center6 can then work closely with senior leaders within the utility to determine the business scenario, industry scope and specific business cases to track, creating a social pulse for enterprise-

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Social Listening Analysis Framework

Identify Listen Analyze Act Integrate

Scenario scope
and objectives

Source categorization

> Social networks > Blogs and microblogs > Professional

networks

Keywords list Domain taxonomy Data crawling

and cleaning and clusters

Analytical models
> Opinion mining > Early warning
system > Predictive modeling > Network mining

Actionable insights
after aligning with business and metrics

Establishment of
command center

Basic analytics Periodic reporting Real-time

dashboard

Filter data

CRM integration Data supply chain Advanced analytics

and metrics

> Forums

Source selection
criteria

Algorithms Data indexing Querying and

Churn analysis Unusual occurrence

monitoring

Analytical tools

search engine

Sentiment analysis

Visualization

Industry benchmarks Documentation

and infrastructure

Source: Cognizant Figure 5

wide analysis. The utilitys command center can use established processes to collect and analyze social media data relevant to the overall organization. These processes can then be shared with various business groups (sales, marketing, customer service, etc.). Social Media Analytics Dashboard To become a socially-engaged organization, utilities need to understand and gain insights from social media through metrics, measurements, sentiment analysis and analytics reporting. A social media analytics dashboard will inform senior management on progress, strengths and weaknesses and then identify ways to improve. Linking social media analytics to organizationwide multi-channel analytics dashboards will provide utilities with a complete arsenal of business intelligence. Figure 6, next page, illustrates a sample list of metrics that utilities can use to monitor their social media presence with respect to their products and launches.7 Step 3: Transforming Customer Engagement with the Utilities Connected App To increase the adoption of online customer selfservice, forward-thinking utilities are proactively providing information about outages, work restoration times and emergency information on their social media and Web sites or through a mobile app. Doing so drastically reduces the volume of customer phone calls and e-mails, thus allowing

utilities to maintain a lean customer care structure and reduce the overall cost to serve each customer. Using social media apps, utilities can not only share messages in an extremely quick and cost-efficient manner, but they can also tailor messages to targeted customers. This creates a win-win situation for both utilities and consumers. Creating Customer Impact via Social Media Apps Utilities can develop a social media app for environments such as Facebook to motivate more customers to use online self-service channels, acquire customers and solve issues related to customer service. The app can enable two-way communications between customers and the utility, such as a bi-directional flow of customer information from the consumers social media page to the utilitys page and vice versa (see Figure 7, page 7). Utilities can reap the following benefits from such an app:

Radically

improve customer engagement through interactive customer journeys,8 such as submitting meter reads, obtaining quotations, paying bills, sales, gathering product and service knowledge, etc. (e.g., word-of-mouth spread through the Facebook like feature) to perform necessary transactions, thereby increasing the online penetration of the utilitys customer base.

Accelerate customer use of online channels

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Social Media Measurement Metrics

Utilities Social Analytics
Key Performance Indicators (KPIs)

Basic Analytics

Advanced Analytics
Number of estimated billingrelated conversations Total number of billing-related mentions

Share of voice (SOV) =

Number of billing-related conversations Total number of utilities conversations

Share of voice (SOV) = Sentiment indicator

Billing Awareness

Sentiment analysis = positive (%), negative (%) and neutral (%) Facebook comments, Twitter mentions, blogs, conversations.

(Positive conversations negative conversations) (Positive conversations + negative conversations) Trend analysis: Customer pulse on billing exception and meter reading accuracy trends. EE program launch analysis: By campaign Per specific social platform (e.g. Twitter, Facebook) Per specific post Social campaign cost /benefit analysis = ROI of social media campaigns ROI of traditional EE marketing campaigns

Energy Efficiency Number of likes + number Program of shares + number of blog Effectiveness EE program launch = comments
Number of published posts for utility company Growth = month-over-month, quarter-over-quarter Churn rate = number of customers changing utilities

Social reach = Total number of customers across all social platforms conversing on energy efficiency (EE) programs

Integrate social media customer data with enterprise Proactive issue resolution: Mine customer social
ERP/CRM applications. posts to identify issues discussed and respond appropriately. Continuous monitoring: Text and sentiment analysis of social posts of customers.

Social CRM and enterprise CRM integration:

Customer Satisfaction

Complaint visibility and feedback = Ability of marketing department or customer service executives to respond to issues raised by customers in social channels.

Source: Cognizant Figure 6

Provide

insights that enable customers to compare their power usage with that of their peers with similar living spaces and area zones or to compare rebate programs and heating/air conditioning services from different utilities, etc. service agents, thus lowering the service centers overhead costs. the cost-to-serve per customer in the emerging digital age.

>> Build

a positive community of customers through the like feature of Facebook. formation from around the Web.

>> Use Facebook apps to provide access to in>> Create content tailored to customer needs. Online account management: >> Account overview and summary. >> Energy consumption graphs and analysis. >> Communication channels (SMS messaging,
e-mail, Web chat, etc.).

Reduce dependency on traditional customer Cut

Basic features of a Facebook app include:

Brand-building: >> Use the social media app to humanize the

brand.

>> Crisis event notification and alerts. >> Proactive energy efficiency tips. Sales: >> Get quotes for new customers or plan
change quotes.

>> Respond to customer queries and be open

to feedback as a responsible and accountable utilities service provider. cognizant 20-20 insights

Features of a Facebook App

nd Building Bra

Account Management

maturity and, most importantly, on the way it manages customers. Integrating CRM and social media data should be about converting conversations into transactions. It is about going beyond Facebook, Twitter and other social media channels and finding ways Integrating CRM to enter into a boundaryless world, and social media where customers are in control of 9 data should be the conversation.

Sales and poning Cou

Analyze the conversation data: about converting Listen to and understand conversations into unstructured conversations from transactions.
consumers.

P ay m e nts

B illi n g a n d

Understand the social presence of customers: Gather information on customers social media presence and create a social map of their details within the CRM system and marketing database. the social media strategy aligns with organizational goals and objectives through people, processes and technologies. the social media plan: Establish a social media roadmap based on the requirements and processes. Utilities need to consider these three levers:

Figure 7

Define the social media strategy: Define how

>> Cross-selling opportunities for existing customers.

>> Product and tariff management. >> Online promotional activities, such as loyalty programs, etc.

Operationalize >> People:

>> Share

interesting and customized posts rather than generic sales offers.

Billing and payments: >> Respond and solve billing issues. >> View billing and other online statements. >> Bill notification to customers. >> Make payment feature. >> Direct debit-enabling feature.
Step 4: Integrating Social Media with CRM We live in a business world that is increasingly focused on improving the customer experience. One of the best ways to do this is to leverage existing customer insights by integrating social data with transactional and structured data contained within enterprise CRM systems. Utilities can use social CRM to streamline and improve customer communications. This will create opportunities to address customer churn and retain brand image in a competitive and deregulated market. Further, it will help them to streamline and improve customer communications. Steps to Integrate CRM and Social Media Data The steps needed to integrate social media with CRM data depend on the organizations CRM

Culture, skills, training, planning policies, governance, etc. marketing, sales, customer service, knowledge management, human resources, customer data management, etc.

>> Process: Organizational processes, such as

>> Technologies: Content management, integration, infrastructure, analytics, software, specific use cases, etc.

Prepare traditional CRM to be ready for social

media: Upgrade and modify the workflow, processes, rules, data structure, training, call center, people, etc. with existing CRM systems to enable more effective integration with social data. Create a social business change management plan and involve customer-facing departments like marketing, human resources, branding and promotion, etc. to align common goals. integrate social data with the CRM database, along with social analytics tools, to spot negative comments and work with the business to design quick-response capabilities to protect brand reputation.

Manage organizational change management:

Integrate with existing CRM systems: Finally,

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Risk and Mitigation Strategy

In this digital world, communications channels have greatly changed, while the regulatory obligations of utilities across various geographies have remained the same. Therefore, its necessary for companies to be accustomed to both the opportunities for and the regulatory concerns posed by social media. Embracing social media poses risks for utilities; however, companies should not avoid the inevitable. A risk mitigation strategy can alleviate the impact of negative events and other risks, based on internal organizational strengths (see Figure 8).10

to create a social media policy for employees, senior management and contractors; continue to track basic social media performance indicators; monitor social conversations; and address issues when they occur. Utilities should implement a proactive social media listening program and generate timely reports for their marketing departments so they can detect negative comments and engage with them before they influence overall market sentiment. To do this, utilities need to design a synchronized event-response center to educate customers on relevant facts and information on their various initiatives. At the enterprise level, this will be achieved by integrating social media with CRM strategies. Thus, utilities would be wise from the get-go to create risk mitigation plans and utilize social tools and techniques to portray a new, transparent, innovative and customer-friendly brand image.

Socializing the Plan

Customers are choosing social media platforms to interact with brands of choice and for assistance on products and services. Given this social shift in customer mind-set, it is imperative for utilities

Playing by the Rules

Known Risks
Negative Comments

Risk Mitigation Strategy

A proper response protocol should be in place as part of the social media strategy. Negative comments should be handled by the appropriate departments, such as marketing, branding, human resources, business solutions (smart meters, energy efficiency, demand response, etc.). Proper monitoring mechanisms need to be in place to delete offensive and inappropriate comments. If proprietary or personal information needs to be shared (such as account details, billing issues, etc.), utilities should encourage customers to interact offline with utilities or customer care executives. Utilities should have proper software protections and firewalls in place to protect utilities social media sites, such as blogs, Facebook, Twitter, etc. Utilities marketing teams should examine information posted on social media sites (as part of the social media strategy) to ensure that customers are provided with the latest information. Utilities should abide by proper Web site crawling guidelines (such as robots.txt guidance) and should not crawl and analyze personal customer information obtained via social media platforms. Utilities should provide adequate anti-fraud training to managers and employees to ensure appropriate social media usage and to identify and respond to fraudulent activities.

Privacy Risks

Data Security Updated Information Legal Risks

Fraud Risks
Figure 8

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Footnotes
1

The Rise of Smart Customers, Ernst & Young, 2011, http://www.ey.com/Publication/vwLUAssets/ Rise_of_smart_customers_-_What_the_sector_thinks/$FILE/The_rise_of_smart_customers_What_the_ sector_thinks.pdf. The survey shows 75% of respondents reported a negative relationship with their energy supplier, and none rated the relationship as positive. Social Media in the Utility Industry: Consumer Survey, Pike Research, 2012. R.P. Siegel, Top Utilities Reaching Out With Social Media, TriplePundit, March 7, 2012, http://www.triplepundit.com/2012/03/top-utilities-reaching-social-media/. Matthew Burks, Top Utilities Using Social Media, Esource, July 10, 2012, http://www.esource.com/Blog/ESource/7-10-12-SocialMedia. Mike Breslin, Social Media and Utilities, Intelligent Utility Magazine, July/August 2009, http://www.intelligentutility.com/magazine/article/social-media-and-utilities. Christopher Perdue, Utilities Facing Up to Social Media, EnergyBiz, June 26, 2011, http://www.energybiz.com/article/11/06/utilities-facing-social-media. David A. Schweidel, Wendy W. Moe and Chris Boudreaux, Social Media Intelligence: Measuring Brand Sentiment from Online Conversations, Robert H. Smith School of Business, University of Maryland, June 2012, http://www.rhsmith.umd.edu/faculty/wmoe/SMI%20(ART).pdf. Dr. Freimut Bodendorf, Social Media Analytics, Institute of Information Systems, University of Erlangen-Nuremberg, January 2011, http://www.iaria.org/conferences2011/filesDBKDA11/Globenet11_Keynote_FreimutBodendorf.pdf. A command center is a monitoring and analysis center in which utilities can track the social pulse of customers for enterprise-wide analysis. It uses standard frameworks and processes to collect and analyze conversations, obtain competitive insights and extract customer sentiments. The resulting social media analysis can be passed on to different business groups. The command center engagement model setup can be accomplished through partnerships, joint ventures, managed services and other evolving business models. Marshall Sponder, Tracking Social Media ROI Viewing Spectrum Analytics, Webmetricsguru, Sept. 5, 2010, http://www.scribd.com/doc/38176762/Tracking-Social-Media-ROI-using-Spectrum-Analytics. A customer journey is a map in the form of a diagram or writeup that illustrates the steps customers undergo when engaging with utilities for products and services, including the online experience, sales, new product launches or any other combination. It represents the different touchpoints that characterize customer interaction with the service provided by the utility. Chet Geschickter and Zarko Sumic, Social Media Provides Utilities a New Channel for Customer Engagement, Gartner, Inc., March 19, 2012. Carolyn Elefant, The Power of Social Media: Legal Issues and Best Practices for Utilities Engaging Social Media, Energy Law Journal, Vol. 32, No. 1, 2011, http://www.docstoc.com/docs/84179818/The-Power-ofSocial-Media-Legal-Issues-and-Best-Practices-for-Utilities-Engaging-Social-Media.

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About the Authors

Debasish Bera is a Senior Consultant within the Energy and Utilities Practice of Cognizant Business Consulting. He has 10 years of energy and utilities industry experience in consulting, business analysis, business development and operations and has delivered consulting engagements with several large global organizations. His areas of interest include smart metering, energy management, analytics, asset management and energy services. He holds a masters of business administration degree in operations management from SPJIMR, Mumbai, in India. Debasish can be reached at Debasish.Bera@cognizant.com. Saurabh Goel is a Consultant within the Energy and Utilities Practice of Cognizant Business Consulting. He has more than seven years of experience working with leading energy and utilities organizations and is responsible for consulting, business solutions, package evaluation and solution design. He holds an undergraduate degree in mathematics from Delhi University and a masters of business administration degree in oil and gas. Saurabh can be reached at Saurabh.Goel@cognizant.com.

About Cognizant
Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process outsourcing services, dedicated to helping the worlds leading companies build stronger businesses. Headquartered in Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 50 delivery centers worldwide and approximately 150,400 employees as of September 30, 2012, Cognizant is a member of the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing and fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: Cognizant.

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