While there’s much commercial and industrial customers likeabout gas unbundling, they still have complaints, according to arecent study. And while marketers are perceived to be moresensitive to customers’ wants and needs than LDCs, utilities arestill favored for gas supply by some.
These findings are part of the annual survey of large U.S.commercial and industrial gas users conducted by RKS Research &Consulting, a market research and polling firm that interviewedsome 500 energy managers of the largest commercial and industrialgas users across the United States. The survey was conducted onbehalf of about half a dozen LDCs.
RKS found commercial customers are more satisfied with theservices and information provided by their gas supplier than oneyear ago. Reflecting the spread of deregulation, 60% of industrialend users and 40% of commercial customers report they now have theoption of buying gas from a source other than their local utility.Overall, commercial customers give gas marketers higher marks thanfull-service utilities. However, the survey revealed a large numberof customers who are disappointed with the performance of theirsuppliers – marketers and utilities alike. These customers remaincritical of providers’ failure to contain costs, provide pricingoptions, and their general ease of doing business. And while athird of business customers see a major reduction in their annualgas costs, more than half report no price changes at all.
“Business customers expect that competition will bring lowerprices. When the anticipated savings don’t materialize, service andcommunications problems are magnified. As competition increases,gas providers will need to improve both their pricing and customercommunications – or risk losing business to new entrants,” saidRick Ginter, RKS director of Research.
Commercial customers evidence more satisfaction thanindustrials. Likewise, sales customers are generally more positivethan transport customers, with commercial sales customers the mostpositive of all. While large industrial customers might be morecatered to by both marketers and LDCs, simply because of theirsize, these very large end users have come to expect red carpettreatment, Ginter explained. Commercial customers, on the otherhand, haven’t traditionally been wooed by marketers and LDCs. Thenew extra attention could lead to more satisfaction.
Nearly two-thirds of industrial transportation customers – 60% -report only negligible reductions in annual gas costs, compared to47% for commercial transport customers. And 45% of industrialtransportation businesses rate their providers fair to poor in thearea of keeping rates down.
Nearly a third of the sales customers in this year’s survey areformer transport customers who have returned to their localutility. Measures of customer loyalty to suppliers are low forutilities and marketers alike, and contracts remain short-term innature. “All of these trends point to continued activity in themarket – and opportunity for new entrants.” But the 1998 RKS surveyalso contains good news for gas suppliers. For instance,satisfaction scores have increased for sales customers, animprovement from the 1997 findings. And all customer groups agreethat the image of gas suppliers – how they value customers and workto retain their business – has significantly improved.
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