One-upmanship continues in the SME market, with SSE the latest to join the fray

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16 August 2013, Gas, Electricity

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SSE has called British Gas' bet on ending auto-rollover contracts, but has raised the stakes by enhancing its micro-business back billing commitment and by ending unsolicited cold calls across the market. This means that when a customer has been under-billed due to a "genuine billing error," it will not be issued a back bill for more than 12 months prior. It will also not contact customers it does not have a previous relationship with or who have not previously agreed to a call. Which? has found that some customers in the market complain of up to 50 sales calls a month, something SSE does not want to be associated with any longer.

SSE has successfully upstaged the competition in the trust and transparency game that is occurring at the moment, but is this as far as it will go? My prediction is that the rest of the Big Six will immediately follow SSE's lead on both back billing and cold calling. However, being the "first" to do something is still a valuable marketing tool and a badge of honor to show that you really are getting to grips with trust issues in the market, and SSE will make sure to leverage this in its positioning in the market.

However, it is not all good news for customers. SSE's move to stop unsolicited calls looks good on the face of things, as it should lessen the stress customers are put under by pushy salespeople and reduce SSE's exposure to possible mis-selling abuse by these representatives. On the other hand, it may have the same effect on the market as when doorstop selling ceased, meaning churn rates are likely to decrease. For this to be a truly positive move, engagement with customers (both domestic and micro-businesses) must be encouraged in other ways apart from cold calls, otherwise churn rates will stay depressed and competition in the market will suffer.

If the suppliers could now start a new one-upmanship game of providing ways to engage with customers alongside their ongoing trust and transparency tussle, then the market will be a truly better place. / / @DatamonitorEN

Source: MarketLine

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