- Almost eight in ten (78%) Irish consumers plan to switch provider for at least one household essential this year
- Those considering switching electricity suppliers almost doubles since 2015 to 40% – but official switching figures tell a different story
- Almost six in ten of us (59%) have previously thought about switching supplier, but fear factors mean many of us still fail to go ahead
- Loyalty doesn’t pay, but almost a quarter of electricity, home and mobile phone customers (22%) claim to have been with the same supplier for over 10 years
- CER figures show 81% of electricity and 69% of gas customers are on standard tariffs – there’s a €318 difference between typical standard tariffs and the cheapest deals in the market, so Switcher.ie urges consumers to fight apathy and take control
As Irish households continue to battle against the squeeze on their finances, almost eight in ten of us (78%) are planning to switch at least one of our household suppliers this year, according to new research from independent price comparison and switching service, Switcher.ie. But, despite best intentions and substantial savings to be made, fear factors continue to prevent many from actually going ahead – leaving them unable to cut their costs or secure a better deal.
For almost all household services, more people say they intend to switch provider this year than they did in 2015. The findings show that 45% plan to switch motor insurance, compared to 25% in 2015, while one in three (34%) say they plan to switch internet provider, up from 21%. Given our ongoing love affair with our mobiles, a quarter (24%) intend to switch mobile phone network, up 9% on last year.
But despite good intentions, many consumers fail to follow through. While four in ten (40%) say they plan to switch electricity in the next 12 months, almost double the amount that intended to switch in 2015 (22%), the official switching figures tell us a different story.
The Commission for Energy Regulation’s 2016 figures revealed that 14% of Irish people actually switched electricity in 2016 – and so far in 2017, average switches per month are broadly in line with the numbers from last year.
So, while the intent to switch is there, it’s clear that people don’t always go ahead with it. In fact, three in five (59%) people said that they had previously thought about switching utility provider, but didn’t switch in the end.
The research suggests that fear factors are continuing to prevent people from taking control and securing a better deal. As a result, many are being left paying considerably more than they need to. Key concerns for those who didn’t go ahead with switching appear to be: not wanting to get tied into a contract/pay a deposit to start a contract (36%); not being able to tell if a new supplier would save them money (34%); thinking that switching seemed like too much hassle (32%); and being unsure if the new product was same as what was offered by their old supplier (29%).
It’s also clear that consumers need greater reassurance and some facts about switching – one in ten (11%) who didn’t go ahead with a switch were afraid of losing service, and over a third (35%) of consumers are unclear about the fact that all electricity and gas suppliers use the same network to supply household energy.
While some customers will choose to stay with an existing supplier out of genuine loyalty, it is important that those who are unhappy or want a better deal feel they are empowered enough to leave. For most household essentials, Irish customers stick with their providers for 5 years or more, on average. But, incredibly, almost a quarter of electricity, home and mobile phone customers (22%) claim to have been with the same supplier for over 10 years.
According to a recent working paper from the ESRI, the longer a customer has been with a supplier, the less likely they are to switch. And this loyalty simply doesn’t pay, with longstanding customers frequently left languishing on more expensive tariffs or plans than new customers. Taking just one household essential – energy bills – this loyalty could mean customers are up to €318 out of pocket, as anyone who hasn’t switched in the last year will likely be on their supplier’s standard tariff, which will be more expensive than the initial discounted rate.
And, although suppliers do sometimes offer so-called ‘retention deals’ to existing customers to hold onto them, only a small number of consumers (6%) that didn’t switch say this was because they got a better deal from their current provider.
Eoin Clarke, Managing Director of Switcher.ie, said: “Households across Ireland are still feeling the pinch, but switching offers us the chance to take back control, get better value for money and potentially save hundreds of Euro – which could be crucial for anyone struggling with their bills. It only takes a few minutes to compare deals for broadband, energy, TV and phones and, with substantial savings to be made, it’s well worth taking the time.
“Our research shows that awareness of switching and households’ intentions to switch are high, but people are still being held back by fear factors. It is vital that consumers are educated and feel supported enough to be able to shop around and switch freely so that they can make better-informed choices about the suppliers and products that suit their needs and budgets. In this day and age, loyalty doesn’t pay – simply sticking with an existing supplier will frequently land you with a higher bill than if you shopped around.
“Although signing a contract with a new provider can seem daunting, it doesn’t need to be. In general they range from just 12-24 months for the likes of energy, broadband and TV, with SIM-only mobile deals, and some broadband and TV plans, available on 30-day contracts – and there’s a 14-day cooling-off period if you sign up and then change your mind. There’s no need to worry about your electricity or gas being cut off when you switch, either, as all suppliers use the same cables and pipes to supply energy to your home.”
Customers can save up to €318 by switching energy providers, and there are currently savings of over €400 available on some broadband bundles. SIM-only mobile plans available from €6 per month. You can compare deals and make a switch on Switcher.ie.
For more information, visit Switcher.ie
Research was carried out in May 2017 for Switcher.ie by Coyne Research, involving 1,000 online interviews with Irish adults aged 18+years. The total sample is representative of the national population in Ireland.
 In response to the question: “Looking at the following household bills, for which of them – if any – are you likely to switch your provider in the next 12 months? (select all that apply) Electricity, gas, home insurance, motor insurance, health insurance, current account, home phone, mobile phone, internet/broadband, television, bins/recycling, none of the above.”
 In response to the question: “Has there ever been a time in the past when you were thinking of switching provider of a utility but did not switch in the end?”
 In response to the question: “Looking at the following household bills, how long have you been with each of your suppliers? Electricity, gas, home phone, mobile phone, internet/broadband, television, bins/recycling.”
 Source: Commission for Energy Regulation – Electricity and Gas Retail Markets Report Q2 2016
 Source: Switcher.ie – How does Switcher calculate its savings messages?
 Source: Commission for Energy Regulation – 2016 Electricity and Gas Retail Markets Annual Report
 Source: Commission for Energy Regulation – June 2017 Customer Switching Report for the Electricity and Gas Retail Markets
 In response to the question: “The following are a list of reasons that some people have given for not going through with switching a utility provider. Can you please indicate which of the following has stopped you from switching a provider in the past? I did not want to get tied into a contract/ pay a deposit to start the contract, There was no point switching as all suppliers are the same, I could not tell if the product offered by the new supplier was the same as the product offered by my old supplier – comparing products was too difficult, I was frightened of losing my service/getting cut off, I couldn’t tell if a new supplier would save me money, I didn’t know where to get the information in order to switch, Switching seemed like too much hassle.”
 In response to the question: “Do you think that all electricity/gas suppliers use the same network to supply energy to your home?”
 Source: ESRI – Consumer switching intentions for telecoms services: evidence from Ireland