Natural Gas Producer Purchaser Satisfaction Index 1997

Competition and the quest for greater volume may be what drive the gas marketing business, but a new survey of producer customers actually shows many marketers haven’t lost interest in attributes such as performance, dependability and service with a smile.

The 1997 index (second edition) of Natural Gas Producer Purchasers by Mastio and Co. ranks companies who buy and sell gas for producers based on data taken from 364 interviews with 332 producers across the U.S. and Canada, representing combined gas production of 21.3 Tcf/year. It is a composite of performance, preference, service and weighted attribute scores based on producer responses to 35 questions. The questions focus on a variety of subjects, including simplicity of purchase execution, honesty, price competitiveness, willingness to listen, purchase options, readiness to take all gas volumes available, prompt payment within terms, overall ease of doing business and many others.

While some marketers plummeted in the rankings since the last survey in 1995, the group of 63 marketers taken as a whole moved up. “I think by and large you can say an awful lot of people have gotten better at satisfying their customers,” said Richard Mastio.

The company that ranked the highest, Public Service Electric and Gas, was four points higher than the last No. 1 company. And although AIG Trading (now named Sempra Energy) plunged to last place all the way from first in 1995, its composite ranking still was nearly 15 points higher (57.6) than the company in last place two years ago (42.8).

Most of the largest gas marketers came in on the lower end of the ranking, but a few held ground on the high end, such as Amoco (17), Conoco (19), UtiliCorp (28) and Sonat (32). “I think electronic commerce has helped them. There’s all kinds of things that have helped. But if people aren’t careful and don’t make a constantly vigilant effort to be aware of their customers needs, that could change,” Mastio noted. “These people are walking a real tight rope. They’ve got two sets of customers to keep happy:” those on the buy side and those on the sell side. “And it’s a very unusual set of dynamics that you’ve got to keep both balls moving ahead, and if you don’t you risk relationships and business.

“I think many people are focusing on these things and are serious about them,” said Mastio. “Some are more serious than others. Some are giving more care and concern than others.” PSEandG was followed by U.S. Gas Transportation and Tristar Gas at the top of the list. Public Service Co. of Colorado actually remained in the top 10 since the last ranking, improving to No. 4 from No. 7. Prior Energy, Columbia, and ONEOK have consistently done well in Mastio’s rankings.

But the ranking is balanced out by a collection of equally less delightful business partners. Price “just gets you in the door,” said Mastio. But for some companies “price, price, price, price and price” still hold the greatest value. Many of the largest marketers seem to forget being price competitive, dependable in agreements and commitments, having good financial strength and high creditworthiness, and paying promptly within terms are the “bare minimum” qualifications.

“The bottom score of 57.7 on a scale of 100 says that 43.3% of AIG’s customers have some reason to be dissatisfied with them. That’s not real good,” said Mastio. “The IRS is in the low 50s. The Postal Service is in the low 50s. On the top side, Lexus division of Toyota has a 99.9% customer satisfaction ranking..” In second to last place is Vastar Resources (now part of Southern Energy Marketing) and in third to last place is Delhi Gas Marketing.

The large marketers seem to crowd in the lower half of the ranking. Others at the low end include Koch at 59, NorAm at 56, CNG at 55, Union Pacific at 53, El Paso at 52 and Williams at 51. Some of the big boys did manage to move up from the 1995 ranking, though. Natural Gas Clearinghouse moved up one place in the ranking to 49, and Enron came in at 36, up from 49th place in 1995.

Mastio’s 3,000-page survey is available in print or electronically in a Microsoft Windows platform. The whole package is $25,560, the same price for the firm’s other gas industry surveys – a pipeline transportation customer satisfaction ranking and a similar ranking of marketers. The next step for Mastio and Co. is a customer satisfaction ranking of the power marketing industry.

 

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