Water Utilities Counteract Negative Effects of Inflation with Strong Customer Communication Strategies, J.D. Power Finds

May 03, 2023 at 08:00 AM EDT

Overall Customer Satisfaction Rises Despite a 6% Average Price Increase

Significant increases in monthly utility bills are not typically met with open arms by consumers, but the nation’s water utilities have shown that it is possible to improve customer satisfaction in a rising rate environment with strong communications strategies. According to the J.D. Power 2023 U.S. Water Utility Residential Customer Satisfaction Study℠,released today, overall customer satisfaction with residential water utilities is up 3 points (on a 1,000-point scale), even as average monthly bills have increased 6% during the past year. This runs counter to the trend of declining customer satisfaction occurring among gas and electric utilities.

“With monthly rates continuing to rise and the water supply running dangerously low in many parts of the country, there has never been a more critical time for water utilities to proactively communicate with their customers about what they are doing to protect our drinking water today and into the future,” said Andrew Heath, senior director of utilities intelligence at J.D. Power. “Many water utilities have heard that message loud and clear and are now setting the standard for effective customer outreach and communication. Along the way, they are also managing to buck the trend of declining customer satisfaction that we have seen in other utilities in this inflationary environment.”

Following are key findings of the 2023 study:

Customer satisfaction rises with price increases: Overall customer satisfaction with residential water utilities is 734, up 3 points from last year’s study. The improvement comes despite a $5.80 (6%) increase in the average monthly bill amount vs. 2022. Water usage has been roughly flat compared with last year.
Communications and customer service drive customer satisfaction: This year’s increase in customer satisfaction is driven largely by improvements in communications, which have risen 7 points vs. last year, and customer service, which has increased 6 points vs. last year. The communications factor continues to show improvement across each wave of the study, suggesting that utilities are proactively reaching out to customers throughout the year to provide updates on pricing, safety and supply issues.
Fragility of the underlying resource in the spotlight: Even as dangerously low water levels in the Colorado River system have spurred the federal government to propose cutting water allotments in several states, 44% of utility customers perceive their utility is properly ensuring the future water supply. That sentiment is consistent across states supplied by the Colorado River as well as in those that are not.

Study Rankings

The study measures customer satisfaction with water utilities in eight geographic regions. Highest-ranked utilities and scores, by region, are as follows:

Midwest Large: Illinois American Water (781) (for a fourth consecutive year)
Midwest Midsize: Aqua (752) (for a second consecutive year)
Northeast Large: NYC Environmental Protection (784) (for a second consecutive year)
Northeast Midsize: Boston Water and Sewer Commission (761) (for a second consecutive year)
South Large: Miami-Dade County (786) (for a second consecutive year)
South Midsize: Cobb County Water System (791)
West Large: California Water Service (797)
West Midsize: Irvine Ranch Water District (766) (for a second consecutive year)

To view rank charts for each segment, visit: http://www.jdpower.com/pr-id/2023040.

The U.S. Water Utility Residential Customer Satisfaction Study, now in its eighth year, measures satisfaction among residential customers of 92 water utilities that deliver water to populations of at least 400,000 and is reported in four geographic regions and two size categories: Midwest Large; Midwest Midsize; Northeast Large; Northeast Midsize; South Large; South Midsize; West Large; and West Midsize. Overall satisfaction is measured by examining 33 attributes in six factors (listed in order of importance): quality and reliability; price; conservation; billing and payment; communications; and customer service. The study is based on the responses of 36,833 residential water utility customers and was conducted in four waves from June 2022 through March 2023.

For more information about the U.S. Water Utility Residential Customer Satisfaction Study, visit

https://www.jdpower.com/business/utilities/water-utility-residential-customer-satisfaction-study.

About J.D. Power

J.D. Power is a global leader in consumer insights, advisory services and data and analytics. A pioneer in the use of big data, artificial intelligence (AI) and algorithmic modeling capabilities to understand consumer behavior, J.D. Power has been delivering incisive industry intelligence on customer interactions with brands and products for more than 50 years. The world's leading businesses across major industries rely on J.D. Power to guide their customer-facing strategies.

J.D. Power has offices in North America, Europe and Asia Pacific. To learn more about the company’s business offerings, visit JDPower.com/business. The J.D. Power auto shopping tool can be found at JDPower.com.

About J.D. Power and Advertising/Promotional Rules: www.jdpower.com/business/about-us/press-release-info

View source version on businesswire.com: https://www.businesswire.com/news/home/20230503005281/en/

Contacts

Geno Effler, J.D. Power; West Coast; 714-621-6224; media.relations@jdpa.com

John Roderick; East Coast; 631-584-2200; john@jroderick.com

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Water Utilities Counteract Negative Effects of Inflation with Strong Customer Communication Strategies, J.D. Power Finds

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