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Wednesday, 24 October 2012

British Gas : Winning with Nectar

According to British Gas, they have added 2m additional customers since they introduced Nectar points. 55% of these new customers joined BG's highest value customer segment and BG's overall NPS score grew by 5 points. 2m customers are earning Nectar points for self meter reading which is a nice win/win - the customer gets points and BG have lower service costs. A good example of "rewarding the behaviour that you seek".

Chris Allin, Director of Loyalty & Customer Communications at BG explained why they chose to join the Nectar programme at the recent Loyalty World conference.
Why did they feel they needed a loyalty programme?
  • Energy utilities is a commoditised market and they needed to differentiate
  • Their customers wanted to be rewarded for their loyalty
  • They needed to drive brand reappraisal in some parts of world – many people still associated British Gas with the un-nationalised company which offered poor customer service
  • They wanted to be able to deliver a non-price lever
Why did British Gas chose Nectar?
  • It is the largest UK coalition programme
  • It has an existing currency and offers greater value reward for their customers
  • It offers new customer acquisition opportunities and access to new channels
  • It offers good opportunities for brand alignment with other big, non-utility names and great co-partner opportunities
  • It has an enhanced customer database and provides some world class analytics and instant access to what the current drivers of loyalty are
Loyalty is about long term gain but everyone has to justify investments to “The Board”
Allin’s 5 objectives that he put to his board were:
  • To enrol highly engaged collectors, both existing and non-existing nectar members
  • To acquire nectar customers
  • To engage and drive changes in behaviour – get existing customers to buy more and acquire new customers
  • To retain customers and reduce churn
  • To cross-sell and increase customer value

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