Energy firm branding, not deals influences customer switching

26th October 2017 | Residential Energy

Energy companies in the UK are using specific branding approaches instead of product innovation to keep customers, according to new research from the University of East Anglia (UEA).

While previous research has tended to focus on pricing, this study looked at the branding strategies and personalities of the Big Six energy firms – British Gas, SSE, EDF, Eon, Npower and Scottish Power – and whether this is increasing consumer loyalty and therefore switching behaviour. The Big Six represent more than 90% of all energy supplied in the UK consumer sector.

Focusing on the electricity market between 2013 – when the number of customers switching providers reached its lowest level – and 205, the researchers find that brand personality consistency over time is important.

Energy Firm Branding

Consistent brands, such as EDF Energy, performed better as they saw decreases in switching compared to firms, like Npower and Scottish Energy, that had significantly changed their brand personality position or communicated inconsistently in this period.

Providers that had a significantly different brand personality position between marketing communication channels, such as their website and annual report, also had more switching than those that remained consistent. Interestingly, the majority of the brands studied were inconsistent on this measure. The findings are published in the journal European Management Review.

Lead author Dr Richard Rutter, a visiting research fellow at UEA’s Norwich Business School and assistant professor at the Australian College of Kuwait, said, “This research demonstrates the long-term importance of corporate branding in the energy sector and that brand personality does have an impact on customer retention.

“The Big Six energy providers recognise the power of brand identity when attempting to persuade consumers to switch providers. Rather than doing so simply on the basis of superior financial offers, they are increasingly looking to build a long-term brand personality with which consumers will identify.”

More information available on the website below