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Why water companies need to tap into artificial intelligence to improve their customer experience

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With utilities ranking as one of the worst performing industries in The Institute of Customer Service 2018 UK Customer Satisfaction Index, and Ofwat’s latest regulation revamp calling out for big changes, it’s clear that water companies need to switch things up. 

Benchmarks have shifted, and digital pioneers have raised customer expectations. This is no longer about what other utilities companies are doing. It’s about being comparable to organisations both inside and outside the sector, those succeeding in an increasingly data-driven and interconnected world. 

Customers expect experiences akin to those delivered by consumer giants Amazon, Netflix and Uber. They are interacting with brands that deliver supportive, streamlined and personalised services at every touch point and expect the same experience when engaging with their water supplier. 

So what can water companies do?

Develop an outside-in, CX-led approach

With people wanting more for less, and Ofwat’s latest price review putting pressure on suppliers to do more for their customers, water companies need to be making positive improvements to their CX.

PR19 highlights this and asks businesses to give customers more control over their accounts, with instant access and management of consumption and bills a priority. It also asks suppliers to drive down costs, and provide support for all vulnerable customers.

Ultimately, PR19 is going to challenge companies to deliver in areas that the sector has previously neglected…  

Understanding why they need to be customer centric is the first step, but knowing how to get there is absolutely critical.

“Today’s customers are much more demanding and expectant that businesses will personalise services to fit them, not the other way around, and this is a major learning curve for a monopoly sector to navigate.” - Monica Mackintosh, Customer Services Director at Echo Managed Service

To meet the needs of today’s customers, organisations need to take inspiration from those who are achieving success from original and customer driven strategies.

Innovating new solutions that will work for their own customers requires businesses to tap into their data insights. This will determine the specific problems their customers are facing, and the type of experiences that are going to perform well.

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Upon analysing its own data, Uber recognised they had a problem with ‘fake drivers’. To boost customer confidence and protect drivers against fraud, they rolled out a new security feature using facial recognition. It also benefited Uber in other ways, as they were able to monitor employees and minimise the number of drivers sharing accounts.

The technology, provided by Microsoft Cognitive Services, is a widely-available platform which contains a number of AI services like natural language processing and real-time translation. Its facial recognition service relies on image-processing algorithms to detect and identify the driver’s face in a photo.

For Gary Pretty, Technical Strategist and one of the first Microsoft AI MVPs, this is something water companies should take inspiration from, “Customer confidence is vital in building relationships and delivering excellent service. I can see something like this working when engineers make home visits. It’s a great example of how technology can boost customer trust.”

However this concept poses a significant challenge for organisations in regulated industries, as Gary explains: “Many companies are reluctant to be first to adopt a technology, particularly in regulated industries, and look for others to demonstrate value first. I think this is going to change  it has to  for water companies with the emergence of PR19.”

WIJ Blog: Gary Pretty Quote

It’s time for water companies to make innovative CX a priority.

Create an omni-channel experience

The industry is under significant pressure to completely digitise their offering and harness emerging technologies, yet there are still some companies failing to deliver even the basics expected of CX.

Part of the problem comes down to the ‘do not fail’ mindset that PR14 promoted. But as other industries demonstrate, this needs to move towards a ‘fail fast, fail forward’ mentality.

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Ford is a great example of this. After they established that their customers were only interacting with the brand for about 4 hours a year, they adopted a different ‘customer-experience-first’ mindset with a blended channel approach. This allowed them to utilise multiple modes of communication.

Using Microsoft’s Azure Public Cloud, Ford created the ‘FordPass’ app to increase the number of times customers positively engaged with them. By covering the basic needs of all car owners, from booking service appointments to locating parking spaces, it has helped reposition them as the company that helps customers get from ‘A to B’ - a timeless position, irrespective of what happens with innovation in the motor industry.

The brand also needed to empower a shift in culture. Employees had previously worked within the constraints of traditional development and operational processes, but this had to change to suit the cloud native mindset. By breaking down these barriers, Ford were able to deliver a more agile strategy.

Water companies need to take a similar approach…  

PR19 recognises that customers only interact with suppliers when they’re getting in touch to pay their bill or resolve a problem. There’s nothing natively positive about these interactions, yet they’re opportunities for companies to enhance or detract from their CX. The shift from SIM to C-MeX in PR19 also means companies can trial innovative experiences at these inflexion points, without the same fears of failure from PR14.

Other traditional industries are also moving towards the idea of an omni-channel brand. Aviva, for example, are “being encouraged to break every rule in the book, and not feel constrained by traditional ways of doing this in the industry”, says the brand’s Chief Digital Officer, Andrew Brem.

Supported by modern digital technologies, Aviva are exploring new ways to provide useful content to customers and revolutionise the experiences associated with the insurance industry.

“The revolution in customer experience is for us to say  we already know you and can infer most of the other things we need to know”, says Andrew Brem.

For the water sector, this means knowing who will be affected by planned works, current incidents or water quality, and proactively notifying them so they don’t have to initiative contact.  

“If you want to personalise your experience in any kind of meaningful way, then you need to be able to imply, or explicitly know, who the person is. This is wholly dependent on data.” - Jonathan Holcombe, Digital Strategist at Mando

To create an omni-channel experience, companies need to be able to personalise content to different channels and different customers. In other words, they need to know who needs to see what.

One channel we’ve yet to see utility companies take advantage of is chatbots.

WIJ Blog: Chatbots

Customer expectations are continuing to rise, with 51% of customers expecting businesses to be available 24/7 (Ubisend, 2016); chatbots offer a simple solution for companies looking to keep pace with these demands.


A few years ago it was unclear whether customers would adopt automated conversational user interfaces (CUIs) as a serious means to engage with brands, or transact online. However, they’re increasingly forming a core part of a company's CX strategy because they can deliver immediate value to businesses; it’s predicted that chatbots will power 85% of all customer service interactions by 2020 (Gartner).

Chatbots, and conversational interfaces alike, offer a model by which businesses and customers can communicate with one another in a proactive way, 24/7.

Messaging platforms have greater usage levels than websites or applications, and removes friction associated with learning a new UI.



The shared conversation history and ability to pick up where you left off also makes the experience more human than web or call centres would, and the micro-interactions create a far more meaningful and accessible bank of data for analytics and CX improvements.  


They will also help water companies drive down operational costs in the long term — a key requirement of PR19 — by reducing resource required to man traditional channels, like call centres.

“Moving relevant call centre services online, in the form of chatbots for example, and giving people access to all of the information they want through a digital property will ensure customers are happier and more informed. It also frees up resource for those that really need it, like vulnerable customers.” - Paul Fennemore, C Suite Level Digital Marketing and Customer Experience Consultant at Sitecore

We are seeing chatbots break down communication barriers that currently exist between customers and businesses. Jonathan Seal, Strategy Director at Mando, believes there is more to be done with this technology, “The real power of chatbots comes when you combine the conversational form of interaction with features - such as natural language processing and machine learning - that make up AI.”   

The advancement of natural language recognition means chatbots can now understand and interpret hundreds of different customers asking the same questions in their own way. Previously, variants like ‘there’s flooding on my street’ and ‘there’s water running along my street’ would have confused a simple web application.

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Access valuable data streams

Consolidating data into one single and powerful tool is extremely forward-thinking. Too often, businesses have limited insight into what their customers are actually doing when they interact with their company.

To facilitate customers’ desired outcomes and interact on a personal level, organisations need to see, hear, understand, and accurately interpret their customers’ needs.

Intelligent Search

Upon analysing the data from its main customer-facing website, one water provider identified a number of search terms which were leading customers to a dissatisfactory end, including ‘postcode’ searches and ‘account number’ requests.

A postcode search would rarely return any meaningful content, and for account number searches, the customer would be faced with a set of results which didn’t obviously lead to a resolution.

Using Language Understanding Intelligence Services (LUIS), part of the Microsoft Cognitive Services cloud in Azure, we are able to seamlessly interpret the intent of customers’ searches in real-time. Once the intent is known, we are able to interrupt the journey with a relevant feature or call-to-action; if a customer searches for a postcode, we can show live incidents, planned works and water quality. As well as improving the customer’s experience, it also helps to reduce the number of customers who contact call centres for help.

GDPR is the perfect opportunity for companies to get smart with their data strategy, and begin to consolidate their data to provide a clear view on their customers.

“GDPR and data management is front and centre of digital technologies, like Microsoft Cognitive Services. The fact that we’ll have data in a more consolidated form will bring only positive changes for water companies who will be able to use that data across different channels”, says Gary Pretty.

If, say, data collected from intelligent search shows that 1,000 people have visited the website searching for a particular incident, one that hasn't been reported yet, AI will recognise the problem through predictive analysis and alert a company to the problem much quicker than a human watching trends.  

Being able to collect more data, segment customers, and integrate digital technologies with content management systems means water companies will be able to tailor experiences with the right information, on the right channels, to the right people.

Specialist tools will help you collect and interrogate your data so you can design a seamless customer journey that meets customers’ needs.

“It’s about understanding who the consumer is through data, and streamlining their journey by providing the information they want, where they want it. Businesses can then maintain digital conversations with the customer to support, educate, inform and entertain them on their preferred channel. Using omni-channel platforms, like Sitecore, allows this to happen in a seamless and automated way.” - Paul Fennemore

Sitecore, providers of digital customer experience management and automation software, suggest that companies must harvest their data to overcome this barrier. This includes digital interactions and information, transactional information, and demographic/psychographic customer profiles.

By doing so, companies will achieve a single view of each customer, which they can use to automate relevant communication across different channels.

One international utilities conglomerate is currently making the shift from disparate platforms, to one centralised hub on Sitecore. By merging the data management of their 13 brands into one seamless account, they are set to reduce cost to serve and improve customer satisfaction.

WIJ Blog: Jon Holcombe Quote

The real value of data comes after you’ve interrogated it and turned it into something that can be interpreted to reveal useful information about a person, system or scenario, to enable data-driven decisions.

Data is the new gold. Information about customers is vital, and that’s where AI plays in.” - Neil Strother, Navigant Principal Research Analyst

Recommendation APIs are a great example of what can be done using data-driven experiences. This particular technology can predict and recommend services and products to customers based on their data - that might be preempting a problem, upselling a solution, or delivering content based on their location.

We see recommendation APIs in action all the time with retailers, who offer us products we might ‘also be interested in’.

For example, water companies could use it to preempt that a pipe has blown and initiate communication with customers, rather than customers reaching out to call centres first.

Realise the opportunity in PR19

PR19 offers significant opportunities for water companies to innovate and operate in the CX space, owning the customer relationship beyond the transaction and delivering more of what matters.

Companies hampered by legacy technology, traditional operating models and inside-out perspectives need to modernise and change. They must build people, data-driven insights and a culture of continuous improvement into their business as usual; enabling and empowering their workforce to serve the customer directly, productively and efficiently. 

Water companies that keep pace and provide customers with a pro-active service will win the CX race. Those that don't, risk disengagement with customers and losing out to the competition.

Want to find out more about the value of digital technologies? Make sure you read our interview with Jonathan Seal, Strategy Director, about the challenges and opportunities for utilities companies looking to use digital.

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We created this article in association with Sitecore, for Water Industry Journal. You can view the original version in their latest magazine.