Abstract
Overview
Introduction
While South Australia and Victoria lead the way in customer switching,
conditions vary across the States and the recent hike in wholesale prices is
holding back retailers, especially new entrants, in competing effectively.
This brief examines switching trends across the country' s competitive States,
customers' drivers for switching, the most effective and preferred channels
and future prospects.
Scope
- Survey of 2000 households in Australia conducted in May 2007 regarding
their switching behaviours and preferences, with comparisons with a 2005 survey
- Breakdown of responses by State, age group, spend and switching status
- Specific analysis of intentions of households in Queensland
Report Highlights
While price and specific financial incentives, such as loyalty or sign-on
bonuses, are the most influential in attracting customers, dual fuel is a key
factor in customers' decisions when choosing a new supplier. Of all
respondents with both electricity and mains gas that had switched, 73% were
supplied both gas and electricity by the same utility.
Door-to-door sales are by far the most effective, initiating the most recent
switch for 58% of switchers. The telephone is only really effective for
existing customers, and using telemarketers for new customer acquisition is
more challenging after the establishment of the Do Not Call Registry, which
attracted a million users in its first month.
In Queensland, those in metropolitan areas and with larger bills were by far
the more likely to seek out a new supplier in order to switch in the first six
months of competition. However, with high wholesale prices, the number of
competitors to AGL and Origin Energy is likely to be limited purely to those
with a strong hedge position.
Reasons to Purchase
- Identify key sources of information for consumers when switching and the
effectiveness of various offers in encouraging customers to switch
- Understand the reasons behind customers not switching, how these have
changed over time, and how to overcome them
- Evaluate the potential for further switching by State, including
anticipated customer switching in the newly-opened Queensland market.
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