Cogent Syndicated: One in Four Texans Plans to Switch Retail Electric Providers

A Decline in Brand Trust Drives Texans to Switch REPs

Newly released research finds that one in four Texans is planning to switch retail electric providers (REPs). A decline in overall REP Brand Trust driven by consumers’ disenchantment with rate plans and lower ratings for REPs’ environmental dedication is fueling these changes. These findings are from the 2019 Cogent Syndicated Texas REP Trusted Brand study from Escalent, a top human behavior and analytics firm.

The report surveyed 5,361 Texans on their experiences with REPs and found the Cogent Brand Trust index has declined by two points to 735. Overall, 16 REPs increased brand trust over the last year while 13 declined. Establishing trust is crucial for REPs as 84% of Texans stated a need to trust a REP before doing business with it. Of the one in four Texans who is now or will soon be shopping for a new REP, almost half have been with their REP two years or longer. This indicates that REPs with low brand trust will be challenged financially.

“The top Texas REPs are conscious of how trusted and valuable their brand is with consumers,” said Chris Oberle, senior vice president at Escalent. “The good news for REPs is there is plenty of opportunity to build brand trust and attract new customers. Texans are open to hearing about and using new providers they can trust.”

Another finding of the study shows that after 17 years of deregulation, 38% of Texans prefer to purchase their electricity from a REP, while 28% would like to use their incumbent utility. Of the incumbent utilities, AEP Texas (32%) and CenterPoint Energy (31%) have the strongest preference among Texans.

“With so many provider brands to choose from and customers open to switching, successful REPs will need to become trusted brands to avoid losing profits on customer churn,” Oberle said.

The following highlights the 2019 Most Trusted Brands among Texas Retail Electric Providers (in bold). These brands have a competitive advantage on customer attraction and loyalty. Also included are brand trust scores and rankings for all large and challenger REP brands.

Source: Escalent. Cogent Syndicated. Texas REP Trusted Brand. September 2019.

About Texas REP Trusted Brand™

Cogent Syndicated measures Customer Engagement and Brand Trust among customers of Texas retail electric providers by surveying 5,361 customers across providers based upon data-driven models. The study measures key performance indicators (KPIs) to provide management perspectives on how to improve REP brand positioning, sales and promotion, customer trust, effective messaging, product sales, customer experiences, service quality, customer acquisition and loyalty. Escalent’s Brand Trust model comprises nine factors: community support, customer focus, communications effectiveness, environmental dedication, local reputation, reliable quality, competitive rates, enhanced offerings, and billing and customer service. The study collects a demographically representative sample across all Texas service territories open for retail electric competition. Escalent will supply the exact wording of any survey question upon request.

Click below to learn more about the full report.