Sam Dunn: You walk away from one utility... into a brick wall
Sunday 21 May 2006
Don't talk to British Gas about consumer inertia.
The utility revealed on Friday that, in the year to date, it had lost 350,000 customer accounts. Disillusioned with the price hikes of 22 per cent introduced in February, they did what all companies fear - voted with their feet.
Whether they used switching websites, did their own research or simply reacted to advertising from a rival, their decision showed a willingness to hunt for a better deal.
One can only applaud because, in the long run, everyone should win: the deserting customers will save money and the losing company will try to improve its performance to keep other customers loyal, and also to win new business.
Switching from companies to which households have been loyal for a long time - chiefly those supplying gas, electricity, landline phones, mortgages, and home and car insurance - used to be for the few. Now it is a popular pursuit.
That's what figures from switching websites tell us, though the trend began to hit home for me when a taxi driver extolled the virtues of his new broadband deal recently.
The idea of switching as a new national hobby was reinforced by the subsequent revelation that my normally tolerant parents had decided to dump BT after 30 years, shopping around for a decent internet deal and, ironically, opting for the Post Office - BT's precursor, from which they got their first phone in the 1970s - for landline services.
With burgeoning competition in the broadband and mobile phone markets, the scope for saving money can only get bigger.
However, the downside to all this frenzied activity is that many companies are struggling to cope with the inflow of new business. And when this translates into administrative glitches, there's a danger of all the good work being undone.
According to the, admittedly limited, research on switching, many people couldn't care less whether they make some extra annual savings by swapping company X for company Y.
But they will change supplier - whatever the industry - if the service they receive deteriorates.
It would be a shame if this switching momentum lost some of its power because of rising dissatisfaction over new customer service problems.
Companies don't generally publish the number of complaints they get from consumers, and that's no surprise: there's plenty of anecdotal evidence to suggest a steep upward slant in grievances among people who have switched.
Few of us have yet to experience the exasperation of running into a wall of customer service staff unwilling, or unable, to help. And of all the modern-day gripes, those concerning faulty gas and electricity bills are some of the most galling.
Too often, the Money postbag at The Independent on Sunday details the agony of readers baffled by the mistakes of the power suppliers. The wrong address, inaccurate estimates and astronomical "phantom" bills for unused services - these are the most common problems, though there are plenty of others.
Happily, the consumer burden should be about to get lighter. In July, a new energy industry "switching and billing" ombudsman will be created to help resolve these problems and more.
Supported by its staff, the ombudsman will try to tighten some of the industry's looser practices.
If successful, the concept should immediately be rolled out to other sectors.
As switching embeds itself in our consumer culture, the numbers running into administrative difficulty will probably rise. Bring on the ombudsmen.
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