Billing and payment preferences in Australian residential supply

Publication Date	October 2006
Publisher	Datamonitor
Product Type	Report
Pages	17
ISBN Number	not applicable
Product Code	DAT04166

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Summary

Introduction

With utilities focused on reducing cost-to-serve, opportunities exist within the billing and payment operations to reduce costs in line with customer preferences, thus securing both a lower cost-to-serve and improved customer satisfaction. This brief draws on results from a survey of over 2000 Australian households to highlight customers' predilections for lower-cost billing and payment options.

Scope

A survey of over 2000 households across Australia regarding behaviours and preferences relating to bill presentment and payment.
Analysis of preferences and behaviours overall and broken down by electricity spend

Highlights

Australian households show a preference to shift away from more expensive payment channels to cheaper options, such as Direct Debit, even without an incentive.

If incentivising a switch to Direct Debit, the most popular inducement of those suggested was a 2% discount on each bill.

There is significant interest in options such as bill smoothing and combined electricity and gas bills.

Reasons to Purchase

Identify ways in which to incentivise customers to choose lower-cost payment methods.
Understand the differences in preferences by electricity spend.
Assess the opportunity for smooth billing and combined gas and electricity billing and electronic billing.

Content

Catalyst
Summary
Methodology
Introduction
- Billing, payment and late payment account for approximately 40% of the residential cost-to-serve
- AnaLYSIS
- How customers currently pay their bills and why they choose such methods
- How customers would prefer to pay their bills
- Incentivising customers to pay by Direct Debit
- Frequency of bill payment
- Interest in particular billing and payment options
- Bill smoothing
- Combined gas and electricity bill
- Paper versus electronic billing
Summary
- Key findings
Appendix
Further reading
- Ask the analyst
- Customer support
List of Tables
- Table 1: How Australians currently pay their electricity and gas bills
- Table 2: Why consumers choose to pay by that method
- Table 3: Current vs. preferred methods of payment
- Table 4: Would you still pay by credit card if you were required to pay the 1% merchant fee?
- Table 5: Attractiveness of incentives for switching to Direct Debit
- Table 6: Attractiveness of incentives for switching to Direct Debit - by electricity spend per annum*
- Table 7: How interested are you in bill smoothing?
- Table 8: How interested are you in bill smoothing? - by electricity spend per annum
- Table 9: How interested are you in receiving a combined gas and electricity bill?
- Table 10: Preferred billing options: paper vs. electronic
- Table 11: Preferred billing options: paper vs. electronic - by electricity expenditure spend
List of Figures
- Figure 1: How Australians currently pay their electricity and gas bills
- Figure 2: Attractiveness of incentives for switching to Direct Debit
- Figure 3: Attractiveness of incentives for switching to Direct Debit - electricity spend per annum
- Figure 4: What is the preferred frequency for paying an electricity or gas bill?