In August 2014 Ofgem appointed BMG to conduct research on ‘Micro and Small Business Engagement in Energy Markets’.
Its conclusions have now been published
Although the sample was relatively small at 1,502 and was not randomised but focussed on those who “were most likely to be affected by reforms resulting from Ofgem’s Retail Market Review”, the insight provided is still valuable in understanding the psyche, trust and understanding of businesses engaging in the energy market.
In this fourth review of the survey’s findings we focus on the energy market and pricing
Price competitiveness
- Just 33% of businesses were satisfied with the competitiveness of prices in the energy market
- 27% of businesses were dissatisfied with the competitiveness of prices in the energy market
- 33% of businesses were neutral
Supplier options
- 29% of businesses were satisfied with the variety of options available from suppliers
- 26% of businesses were dissatisfied with the variety of options available from suppliers
- 36% of businesses were neutral
Switching advice
- 32% of businesses were dissatisfied with the level of advice available to businesses when they are looking to switch supplier
- 30% of businesses were dissatisfied with the level of advice available to businesses when they are looking to switch supplier
- 30% of businesses were neutral
Business Juice comment: The glaring hole here is the role that brokers can, and which we do, fill in the market by offering an educative and contractual approach to business engagement with the energy market. The information is available for consumption; it is the lack of direct engagement with information providers that is preventing education and better decision making.
Ease of switching
- 42% of businesses are satisfied with the ease of switching
- 23% of businesses are dissatisfied with the ease of switching
- 21% of businesses were neutral
Ease of comparing prices
- 38% of businesses are satisfied with the ease of comparing prices
- 31% of businesses are dissatisfied with the ease of comparing prices
- 25% of businesses were neutral
Supplier sales approach
- 19% of businesses are satisfied with the sales approach of suppliers
- 38% of businesses are dissatisfied with the sales approach of suppliers
- 34% of businesses were neutral
Broker sales approach
- 18% of businesses are satisfied with the sales approach of brokers
- 48% of businesses are dissatisfied with the sales approach of brokers
- 23% of businesses were neutral
Business Juice comment: Neutrality and negativity rule in businesses’ view of the overall energy market. Whether it is ‘non-positive’ satisfaction with broker sales (71%), supplier sales (72%), ease of comparing prices (56%), ease of switching (44%), the level of advice for switching (60%), available supplier options (62%) or competitive prices (60%). The overwhelming attitude is indifference at best. Some of these opinions directly contradict the actual experience of business energy market interaction, with brokers scoring an 81% sales satisfaction rate amongst their users and suppliers 77%. How much this is real, experienced belief and how much is fuelled by media commentary and influenced perception would be an interesting next step for a survey of this type.