Instilling Customer Loyalty Prior to Disruption Emerges as Critical Requirement of Effective Crisis Communication for Utility Providers
Utility companies are quickly discovering that establishing robust crisis communication frameworks ahead of emergencies—natural or manmade—have become critical for reaching customer satisfaction goals.
However, it turns out that effective crisis communications initiatives cannot exist in a vacuum. Crisis communications must be an element of a comprehensive stakeholder engagement strategy that is in place and operating on an ongoing basis before, during and after disruptive incidents occur. By developing robust customer communication campaigns before catastrophic events, utility providers build trusted relationships that help industry executives better manage crises and provide a foundation for supporting short, mid and long-term operational plans.
To discuss the strategic advantages of pre-crisis communications and its overarching effect on crisis communication, we spoke to Megan Brown, Executive Director of Corporate Communications at Consumers Energy, headquartered in Jackson, Michigan.
The utility endured a major catastrophic event as a polar vortex incident on January 30, 2019, disrupted natural gas delivery to constituents for two days in the middle of a frigid winter. That same year, 2019, Consumers Energy earned the #1 Ranking in Customer Satisfaction from J.D. Power in the Midwest Region.
Here is what she had to say:
Q: How does Crisis Communications fit into your priorities as a company? And how does it fit in when you are not in crisis?
A: That's a great question. At Consumers, we have done a tremendous job, particularly over the last decade, to become what we like to call skilled “firefighters.” We're very good at firefighting on emergent issues, telling our customers the truth and telling the customers our story during crises, whether that's a storm or a gas leak or an issue like we had in 2019, which we're going to get to in a moment here. We know though that there is also value in proactive “farming,” which means before the crisis hits, making sure we're building those connections in our community, we're telling our story, we're building trust so that when a customer crisis does hit, customers are giving us the benefit of the doubt, whatever the event is. We know that in this business and with Mother Nature, who we can’t control, we're going to have these emergent issues arise.
Q: What was it about your culture that may be different from other utilities when it comes to communications?
A: We have shifted our thinking on crisis communications, we don't ignore what's happening when we're in a crisis, whether that's a storm or another issue, but we have changed the way we view a crisis. We see a crisis event as an opportunity to build trust with our customers. Planning has also been critical, we have adopted a playbook, we put plans in place before a crisis happens and get the red tape out of the way beforehand. We have a crisis communications plan that is edited, exercised, and refined each year. We do several exercises a year to practice. We use the nationally-recognized incident command system, which has worked well. All of these preparations beforehand, along with all the operational plans in place, safety training and media training for executives, helped us be fully prepared for any incident, giving us more flexibility when an incident occurs.
Q: What happened in 2019 and what was the gas incident that occurred?
A: In January of 2019, we experienced an unprecedented event during the polar vortex, which you might recall. It was one of the coldest days of the year, if not the decade. We had a fire at our largest gas compressor station, which is located in Southeast Michigan. This compressor station and storage field helps provide gas and heat to two-thirds of our customers. So the fire at the Ray Compressor station was precipitated by a safety venting process, that in normal times under normal conditions is proven safe, and effective, however, under unique and extreme weather conditions, both the cold and then 30 MPH winds, the process became hazardous. Ultimately, we ended up having to call on Governor Gretchen Whitmer, who exercised the Statewide Emergency System to send a text message and a TV banner message to residents asking them to reduce their thermostats and reduce their gas use, while we made fixes to the system and put our contingency plans in place.
Q: You've received very high marks for the public affairs engagement that took place. Can you tell us about what you did to engage the community?
A: I'll hit on a few things here. We utilized our crisis communication plan. We framed the pain right up front, ensuring that folks knew that mother nature had unleashed her wrath that day. Transparency was absolutely critical. Our messaging was consistent, timely and proactive. We also focused on a humble, honest tone, not defensive. We adopted two simple phrases that work during crises: those are ‘sorry’ and ‘thank you.’ This was critical: sorry for the inconvenience of having to be a part of a statewide mission to make sure no one would go without heat; and thank you for being a part of the solution. We also utilized the three A's of crisis communication: acknowledge what happened immediately; apologize for your part in it; and act to make it right. We tried some new tactics, too. We did two Facebook LIVE events with our CEO which were very effective, including a statewide, press conference with the CEO and our SVP of Operations. We had community affairs’ members go door-to-door to residents who lived by the actual fire and had one-on-one conversations with them. And our CEO was the face of the crisis.
Q: What were the results of these efforts?
A: First of all, we did put out 10 news releases and executed three news conferences during the two-day event. Our officer team did 50 interviews statewide, and then we took 130 media inquiries, and that was our whole media relations team taking various inquiries. We posted 21 times on social media in two days, too. So again, timely, transparent execution. This resulted in: 7 out of 10 residential customers said they lowered their thermostat; and two out of three business customers said they lowered their thermostat. Four out of five customers felt well informed during the crisis and 25 percent of customers said their perception of the company actually improved. This was a survey of 6,000 customers. Customers also gave us an 8.8 out of 10 on customer satisfaction for the communications efforts, and our JD Power scores increased. We were number one in the Midwest Large JD Power category for residential gas customers that year. We were very proud of our efforts and this was an opportunity to build long-term trust with our customers.
Q: How did you wrap up the communications for this incident? And what did you learn?
A: We followed up with a ‘thank you’ campaign. We had a local, Michigan TV ad placed during the Super Bowl with our CEO. We also did some radio and digital thank you messages. And we learned that discipline creates freedom. Because we were disciplined on the front-end having crisis communications plans in place, when we got to the actual crisis, we were able to have a little more freedom to flex and build out different options as we went along with the crises. We also confirmed our theory that if you communicated in a transparent, thoughtful way it can be an opportunity to build trust with customers rather than something you run from.
Q: Where do you go from here?
A: Customers and technology are demanding more from us than ever. However, no matter the obstacle, we want to continue to build connections and trust with our customers. It will be imperative for utility providers to look through a creative lens to continue delivering on those expectations. Operating in a timely, proactive manner will be critical to success moving forward. We are also committed to creating more moments that matter to our customers in the form of customer activations. Physically meeting customers where they are to show support and ensure every effort is in place to make them as comfortable as possible while working to return to normal operations has been a big win for us. During storms, we’re offering free pizza, water, or zoo visits. A little bit goes a long way. It shows that utilities are an integral part of the community. Regardless of the obstacle, customers lean into that sense of camaraderie with utility providers during a crisis or storm. It imparts a genuine feeling we are all in this together.
