Updated on 22/12/2022
Water sector: an evolving sector
Essential services, which affect everyone’s everyday life, are – almost always – taken for granted. They do not have an appeal on which to build branding and storytelling actions or, at least, this was what was thought until a few years ago. Today, however, things have profoundly changed. In this article we want to focus on the Utilities of the water sector, to fully understand how fundamental and indispensable, in the current scenario, the role of marketing and communication in this sector.
We are facing a real digital transformation, in which not only are we faced with new communication technologies, but we also find ourselves totally rethinking the idea of customer. A customer who is no longer on the margins, but has different needs and asks to be at the center of the experience. This has led to a real rethink of the customer experience within the water industry. We have already mentioned the news and trends within the Italian landscape. Translated: new challenges, new risks and new opportunities.
Everything has changed and not only for the waters
The profound changes that have affected the water sector are part of a broader framework, that of the entire Utility Industry, a fundamental and strategic industrial sector that has undergone a portentous and unprecedented revolution in recent years. It is over, in fact, the almost monopolistic regime in which few and mammoth companies shared a regulated market very rigidly and almost impenetrable.
Today the field of play has opened wide, thanks to actions of liberalization of the market (more or less decided, depending on the state); the players have multiplied and the competition in order to acquire new market shares (or not to lose) has become arduous, complex and constantly changing. The key words of the sector have changed: today the focus is firmly on sustainability and energy efficiency. On transparency and simplicity of communication between user and company. On technology, therefore on digital transformation.
But the real key point of this Copernican revolution is the customer: no longer a simple number among other numbers, but the real center around which all business revolves, the true heritage and added value for companies that provide gas, energy and – indeed – water. This is why the marketing, communication and customer care departments are gaining new and increasingly dominant importance in the Utilty Industry, and in the water sector in particular. There are many challenges of the present moment, even more those that are looming on the horizon. Just as numerous, as always, are the opportunities that lie behind these complex challenges. And the best practices to capture them are already being implemented by the best and most innovative companies in the industry.
Challenges for the water sector
In a landscape that has seen a real paradigm shift over a relatively short time period, the challenges are many, and they are complex. First of all, there is the technological challenge, which concerns both the infrastructure and distribution of the commodity and above all the management of communication processes between company and customer.
At the base of this challenge is the analysis of “big data“. It is now essential, that companies in all sectors are able to analyze the enormous amount of data available relating to users and their characteristics, their behaviors, and the way they use the services offered. In order to do this effectively, it is important to use the right tools and set up dynamic and “intelligent” metrics (think of smart metering). And, it is in this context that includes IoT, the Internet of Things.
“In the near future, Big Data, cloud, artificial intelligence, and IoT will be able to do what we can’t even imagine today, opening new horizons and new business areas in the Utility sector, with a view toward services that are personalized and usable by users of Utility services,” said Moreno Mazzoni, CTO of Nextre, a web marketing and strategic consulting company.
These personalized services are as tailored as possible to the customer, modelled on his unique characteristics and his individual behavior. This is where the most important challenge of all lies for companies in the water sector (and Utilities in general): in other words, to increase the quality and efficiency of customer care. A study conducted by Jaywing found that as many as 73% of marketers actively involved in this sector identify the improvement of customer care strategies as an absolute priority for the business agenda.
From the latest data, dating back to 2021, it emerged that 86% are willing to pay more in return, again, for a better experience of assistance and dialogue with the company. And 65% of the sample analyzed claims that a positive experience with a brand is much more important and influential than any type of advertising campaign that can be put on track (source: Super Office).
So we understand why the main challenge lies here: learning how to dialogue with users in a one-to-one, omnichannel and interactive way. In this way, one of the touch points traditionally more slippery, becomes a formidable tool of dialogue, of possible actions of upsell and cross-sell (with the consequent added value that binds to them) and, above all, a means to increase customer retention and loyalty. We have already talked about how new digital tools have the power to establish a renewed communication with the customer, based on dialogue. One example is the use of digital bills.
All this, finally, is also reflected in an image return for companies. With positive effects on their brand identity: another of the most important challenges, in the current scenario, for companies in the water sector. So, summing up: technology and big data, customer care and customization and maximum attention to the restructuring of your brand identity. Here are the main – and complex – challenges facing the water industry.
In conclusion, to better address these challenges, we propose some best practices that begin to emerge strongly in this complex and changing landscape.
Creating partnerships, knowing how to communicate, knowing how to tell a story
In a scenario that has undergone such rapid and radical changes, it is strategic and almost vital to identify suitable best practices that are as up-to-date as possible. In this sense, we are helped by one of the most authoritative international bodies in the sector, the American Water Works Association (AWWA), which at its most recent annual conference gathered around three concrete guidelines the main best practices that emerged from the analysis of the sector.
- The first point to focus on is the need for companies in the sector to create partnerships, even (and especially) outside the boundaries of their sector. This is also discussed in this article published on McKinsey’s blog. This is a dynamic that can also positively reverberate on the brand identity, and provide opportunities for up-selling and cross-selling actions.
- The second point concerns the absolute need for organizations to re-learn how to communicate with their users and do so in a 24/7 perspective and in omnichannel mode. This can be done through efficient online help desks, but also with dedicated apps, and by being able to exploit the power of social networks in a positive way. In short, the days of inefficient customer call centers are over. “It is no longer conceivable that the only moment of dialogue with the customer is when something goes wrong when he has some problem, or when it’s time for your company to collect,” said Kelly Dearing Smith of Louisville Water Company. In short, we are going in the direction we indicated above: the customer must be at the center, and we must try to “communicate” with him, and do it in a way that is custom-made, personalized and “one-to-one.”
- The third and final point, which in the end comes directly from those set out above, is the need to rethink your brand identity and to base it on environmental responsibility, on transparency towards one’s own client (who wants to be more and more involved and informed), on full digitization.
In this field, it must be a priority to pay attention to “aesthetic” components as well. After all, it is necessary to be able to provide information in the most effective way; to do so the most powerful tool is undoubtedly that of the video.