BCG’s Energy Benchmark for Sales and Services

BCG’s energy sales and service benchmark lets energy retailers understand how their performance stacks up against other players’—and what they need to do to improve their standing.

Energy retailers around the world are facing an increasingly challenging business and operating environment. Aggregate demand for power is falling. Simultaneously, new competitors, including unconventional players and those with innovative business models and offerings, are entering the arena. And customer expectations regarding service levels are rising, driven higher by customers’ experiences with leading online retailers.

In this environment, energy retailers seeking to remain competitive must have both an optimized business model and a tight rein on costs. BCG’s energy sales and service benchmark provides energy retailers with a detailed look at how others are faring on these fronts, giving them an immediate sense of where they stand relative to peers—and where they need to get better.

The benchmark compares an energy retailer’s cost efficiency for sales, service, and overhead functions with those of comparable peers. It also identifies each player’s relative strengths, weaknesses, and sources of value creation, and identifies best practices. A retailer can benchmark itself against chosen sets of relevant players based on location and market maturity as well as by the type of customer served, whether it be residential customers, small and medium enterprises, or large businesses.

The benchmark permits a highly refined and detailed comparison of costs related to the sales and service functions. The sales-related components it tracks include:

  • Strategy formulation and steering
  • Pricing and portfolio development and management
  • Customer acquisition
  • Customer retention and insight development
  • Marketing and communication

The service-related variables it examines include:

  • Energy logistics, including interactions with grid operators
  • Billing
  • Payment
  • Customer contact

The benchmark also goes beyond costs. It permits comparison of a number of key sales and service considerations, including such things as the percentage of calls answered within 20 seconds, the percentage of invoices sent electronically, and the breakdown of types of contact with customers, including the percentage of contacts made digitally. This can help an energy retailer understand its relative standing on the digitization journey.

BCG’s considerable experience in the industry allows it to supplement the benchmarking with a discussion of best practices and guidance on how to close cost or performance gaps where they exist. A retailer thus knows what it needs to do to take itself to the next level.

An energy retailer seeking to leverage the benchmark can gather the information BCG needs through an easily understood template. And the benchmark’s team is readily accessible and happy to answer any questions during the data collection process.

BCG’s energy sales and service benchmark is a highly valuable resource for retailers. It permits a retailer a single-source, detailed, apples-to-apples look (including access to data that is not publicly available) at a relevant universe of peers at a time of substantial industry flux.

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