Electricity retail churn – Customer Insights

Project dates: 01/02/2020 - 30/06/2020

This project aimed to understand the factors influencing the customer experience in the energy retail environment and how this experience may be enhanced. 

Why is this important?

The energy retail environment is a dynamic one. Currently undergoing rapid policy and technology change, potential for data optimisation, and with the arrival of retail contestability, the customer experience is more important than ever. Despite government policy to encourage competition via switching, most consumers just want a better deal (something valuable for them – price is just a proxy for dissatisfaction). Hence there is a customer experience gap presenting an opportunity.

What did we do?

To understand those factors influencing the customer experience and how customer experience may be enhanced (i.e., creating value and avoiding ‘churn’) this project involved a full desktop review of available/relevant information on the retail electricity market and customer churn/loyalty behaviour, to addresses the following question:
Which factors drive residential and commercial (SME and large) customers in a competitive market environment to churn (switch from Ergon Energy Retail to another energy retailer)?

What did we find out?

Predictive factors are classified into 2 categories:

  • Behavioural factors (non-price and price)
  • Usage factors

The predictive power of these factors on customer’s decisions to switch (churn) or be loyal are affected by household and individual (residential) or business (commercial) characteristics.

Funding / Grants

  • Funded by Energy Queensland Limited (2020 - 2020)

Chief Investigators

Other Team Members

  • Dr John Gardner (CSIRO)