The traditional media often give utilities a rough ride, but social media provides them with an opportunity to engage directly with customers, says Jonathan Evans.

Utilities are no strangers to media coverage - for good or ill. As regulated (or part-regulated) industries of national importance, this is no surprise. Crucial issues today include multi-billion pound investment programmes, global and national climate legislation, security of supply and pricing.

The traditional national and trade media tend to focus on such issues: a potential national energy crisis, pricing, the need for energy infrastructure investment and the appropriate energy mix - fossil fuel, nuclear or renewables. Sometimes the government appears the villain in this coverage, with utilities portrayed as innovators and entrepreneurs. At other times, depending on the mood or political persuasion of the media in question, utilities are presented as corporate fat cats.

*Windows of opportunity*

The advent of social media has given a voice to a group that five years ago had much more difficulty being heard - individual consumers. This has changed things. Instead of weighing in on one side or the other of well-known debates, blogs and tweets provide a window on a ­consumer-dominated conversation, where the language is emotive and the views are black and white. The issues here are personal: the impact of rising energy prices, fuel poverty and poor customer service. They largely label the energy providers as faceless corporations interested only in profit and unmotivated by customer satisfaction.

Twitter, in particular, has become a platform for the people (see chart below, "Overall coverage split") and the reputation of the energy companies is constantly under attack. If utilities fail to understand the groundswell of social media opinion, they could well suffer significant consequences in reputation.

The IT industry responded well to the advent of social media, with companies such as Dell using Twitter as a customer service contact line. The difficulty is that most utility companies do not know how to engage successfully with consumers. When utilities have a presence on the internet they tend to be very corporate or a stiff, faceless customer service operation. The "social" element of social media is ignored and communications often lack the human element and personality.

*It's good to talk*

While utilities may feel their main job is to provide power and water, not engage with consumers, failure to do so could have significant consequences. For instance, why shouldn't customers blame energy companies for price rises if their concerns are not addressed, where they air them?

Engaging in the rollout of smart meters will be crucial. Research shows that many people see smart meters as just an opportunity for the energy companies to gain more control. Engaging with the market about the benefits, through social media as well as traditional media, will be essential to gain acceptance and support for the initiative.

So what to do? The answer is simple but the execution takes commitment. Utilities must evolve and begin a conversation with their customers. Today, many people feel comfortable communicating through the internet and social media, and that must be addressed. Where the traditional media has disseminated information through a one-to-many channel, the internet requires a one-to-one, personal dialogue. Utilities that fail to engage could find themselves losing control of the conversation.

The chart ("Coverage by issue") shows renewables was the most covered energy topic in the period May to July 2010, while the table above shows that Eon dominated the headlines. British Gas divided opinion most, topping both positive and negative coverage leagues.

Jonathan Evans is the energy & utilities consultant analyst at Alva, which specialises in analysing corporate reputation and reputational risk.

Email: info@alva-group.com