Boost Power had a problem with customer retention but they didn’t fully understand why customers were leaving. I supported the product team with the research in a Discovery to help the team understand customers needs. The team then facilitated collaborative design sessions, in which we quickly developed concepts and validated them through Research before launching the ‘Winter Wallet’, the company’s most innovative initiative to date. This delighted customers and significantly improved customer retention.
OVO Energy launched Boost Power, a Pay As You Go (PAYG) energy brand, in 2017. With PAYG, users need to keep their energy account topped up with credit to ‘keep the lights on’. Boost’s main product, ‘Smart PAYG+’, lets users do this through a smartphone app linked to their smart meter.
PAYG customers are free to change suppliers whenever they want without paying exit fees. And they were leaving Boost in droves. The team had lots of ideas about why that might be, but they had never done in-depth customer research and it was impossible to judge if these ideas would solve real customer problems. The decision was taken to step back and identify the problems PAYG users actually face.
We looked at our competitors and their offerings. We also reviewed customer feedback from social media and our leavers survey. Many complained about the cost of their energy, particularly in the winter, when they might “fork out” much more than in the summer.
We formed an hypothesis to explain why users leave Boost:
Customers think they’re paying more in the winter because we’ve put our prices up (we hadn’t) rather than understanding that they’re using more energy.
We knew that many of our customers were lower income mums and as most of the negative feedback was around energy costs, we were keen to learn more about issues like:
- The challenges mums face managing a tight budget
- How managing their energy costs fit within the context of managing that budget
Research is expensive. We knew that interviewing PAYG users in their homes would help us build rapport, making them more comfortable talking about the sensitive subject of money. We also knew that we would get a better sense of how they lived their lives and what they really spend their money on. We also knew that this approach would reducing the kind of aspirational answers people can give when they are interviewed in a lab situation.
Boost was reluctant to commit the budget we needed without some idea of the value it would bring, so we decided to run a pilot study as a proof of concept to show evidence of the richness of insight we could achieve by talking to people and refine the lines of enquiry we took forward to the more costly home visits. We ran unmoderated online interviews with PAYG users, experimenting with different questions as we went along. We developed a questioning style that allowed participants to tell their story unconstrained by a script. We were also able to use the screener questions to learn from users of competitors
We involved different team members, from developers to copywriters, right from the beginning, to build a shared understanding around the customers’ problems. We ran a workshop where we watched the interviews as a team and captured observations as we went, which we then grouped into pain points, behaviours, attitudes and understanding and goals.
We learned a lot from this process including
- Many people had negative experiences with other utilities where they’ve been hit with a huge bill “out of the blue”.
- People value PAYG as it allows them to stay in control of their spend, they choose it ahead of the cheaper pay monthly tariffs.
- Generally people get paid weekly and therefore top up weekly, they’re hyper aware of how much they’re spending on energy.
- People understand that they’re paying more in winter because they’re using more to heat their home. This contradicted our previously held assumption that people were complaining about higher costs in the winter because they didn’t understand the relationship between usage and costs.
- It’s a real struggle to cover the high energy cost in winter. There are serious consequences to running out of energy credit. Being disconnected is very distressing. (This also creates significant costs for Boost)
We involved as many of the team as we could in the I was able to able to lead on the following interviews we conducted with financially struggling mums around the country. This included our customers and competitor’s customers so we could learn how they solved the problems that they faced.
In parallel to running the home interviews, we ran phone interviews with customers who’d downgraded from our main PAYG+ product, focussing on why they were unhappy with the PAYG+ product.
What we learned
We learned that participants really struggled to save money generally and with no reserves, paying for energy in the winter was using most of their budget.
Some people had strategies like topping up more than they needed in the warmer months, building up a surplus, which would ease the pain in the winter. Not everyone was that savvy. We heard stories about others with no savings who had to choose between heating and eating.
Based on these insights, we concluded that customers were venting their frustration because they were really struggling with the winter energy costs.
We developed a new hypothesis:
If we help customers to save money in the warmer months so they can cope better with energy costs in the colder months, then our retention rates will improve.
We also know that gamification can motivate people so we hatched a plan to provide a third wallet with a way to “level up” to motivate people to save.
What happened next
Having mentored the team through the Discovery I returned to my work on the OVO Energy platform and the team wove their magic and created the Winter Wallet.
Nearly 25,000 Boost Smart PAYG + customers opted in to the Winter Wallet, and they managed to save a whopping 1 million pounds.
7,000 of these customers reached their ambitious targets and received their 5% bonus credit, meaning we credited those customers with a total of around £35,000 towards their energy bills this winter.
Customers were significantly more likely to stay with Boost if they were part of the Winter Wallet trial. Customers have been very positive about the Winter Wallet on social media and it received positive press coverage.