Three years ago, when the United Illuminated Company (UI) launched an Electronic Bill Presentment and Payment (EBPP) capability, there was no road map for us to follow. In fact, we were considered a pioneer of sorts and were guided more by a vision of the future of Internet billing than by any concrete data on what worked and what didn’t.

But our EBPP initiative is paying off nicely, especially since we have expanded our capabilities and deepened our understanding of the new technology and the role of e-commerce in the future. And because scores of others in the industry have yet to take the EBPP plunge, we are building a formidable competitive edge!

From the outset we were guided by three goals: to provide our customers with more convenient or enhanced services; to lower our costs; and to make progress in transforming our web site from an “information” orientation to a true e-commerce site. We’ve achieved or made significant progress toward achieving all three goals.

More convenience for customers
Our customers using the new service tell us they like the convenience of not having to write checks, or to stamp and stuff envelopes, and they especially like knowing their payments are being handled automatically with virtually no chance for delay or error.

Enrolling in the service is easy, takes only a few minutes and involves no more detail than existing automated payment or pay-by-phone services. The use of account and personal identification numbers assures confidentiality.

Part of the credit for the fast and easy sign-up goes to consumers, who are technologically savvy. But part also goes to the “crystal clear” sign-up procedures, worked and reworked by specialists from both UI and Pitney Bowes docSense, which is hosting our Internet billing service. The mail and messaging giant also handles our paper-based billing on an outsourced basis.

Once enrolled, UI customers merely access their bill on the Internet, review it for accuracy, and authorize payment, which is accomplished electronically at the end of every business day.

We’ve even bolstered our new service with additional features. For example, our customers said they wanted a direct deposit option, which allows them to select in advance a specific day for automatic payments to be made, and a variable payment option which allows them to make multiple payments, to pay in advance, or to vary the amount paid.

The variable payment option also allow customers to contribute to UI’s popular Operation Fuel program, which provides funding for customers struggling to pay winter heating bills.

Additionally, the electronic billing option has been expanded to permit customers to view their billing history on-line, and to manage their account data themselves -- for example, to change e-mail or bank information -- eliminating the need to call UI’s customer service center.

UI is adding still more enhancements as we move forward to make the service more useful to current users and to attract new ones as well. The service now supports a single log-in for multiple accounts so, for example, a landlord can log-in once and pay a multiple number of tenant accounts. UI also offers a “view only” option for consumers who already use a “pay-by-phone” service. These consumers can be alerted to the availability of their bill via e-mail, so they can view the bill on-line and then “pay-by-phone” as the have in the past.

More cost-effective for UI
Customers using the EBPP option are also responding to bills faster than before. In fact, consumers are making payments an average of nine days sooner! That’s nearly twice as fast as their response rate using the traditional or paper-based mail format.

The central purpose of a billing application is to achieve prompt payment. Major corporations may invest millions of dollars in data processing, print and mail finishing, labor and postage just to get mail out the door so the improvement achieved by Internet billing is a giant leap forward.

So regardless of the other benefits of Internet billing -- such as the lower cost to distribute bills, the ability to accelerate delivery to near instantaneous status, automated handling of payments, and the opportunity to custom-tailor electronic messages via hot links, banner ads and attachments -- the acceleration in payment alone is enough of an incentive for us.

Insight into consumer behavior
But other key benefits, which include the opportunity to learn more about consumer behavior, are significant, too. We’re using our EBPP capability to learn more about how consumers interact with web page-based information, which will help us create a more rewarding one-to-one relationship with each customer and develop a more effective e-commerce capability.

For example, we’ve discovered the majority of consumers using the Internet billing option tend to make payments the first time they view their bill. These users seem to be “action-oriented,” and we’ve seen very little procrastination or the common practice of waiting for other bills to arrive before writing several checks at once.

The Internet bill users are also an alert, curious and knowledgeable group of consumers. How do we know? By carefully monitoring their use of the web site, particularly how customers access the hot links.

When we began the pilot, the FAQ (frequently asked questions) hot link received the greatest number of hits. The next month, it was the chance to view the previous bill.

When we introduced an EZ-print option, that became the biggest hit. And when we merely changed the headline on our late payment link, more than a third of the users hit the link to find out more information.

Consumers using Internet billing also tend to use e-mail to make follow-up inquiries about the service or other aspects of their relationship with UI.

Use of e-mail is quick and easy for them. But it is beneficial to us as well because it helps lower the work load on our customer service call center and saves us the cost of handling “live calls, which can be substantial for any organization.

A steady rate of acceptance
One key question remains: Exactly how fast are consumers migrating to our new Internet billing service? Enrollment increased 120% last year and we clearly like the trend.

After the initial test period, we introduced the Internet billing option with what we call a “soft roll-out.” The goal was to make sure all systems continued to operate as expected and to migrate users in an orderly if somewhat conservative fashion. We used banner ads on our web site, on our horoscope page, and on regional newspaper web sites, and issued brief news announcement and special inserts in our customer bills.

The systems were up to the task -- as evidenced by the 100% timeliness achieved by outbound e-mail notifications and the 99%+ system uptime -- and the “soft” effort attracted several hundred users in just a few months.

We are now managing a more traditional “hard roll-out” using a mix of traditional and non-traditional techniques. Our goal is to migrate 5% of customers, which appears well within reach.

Inserts are being sent with each bill, stuffers are included in the daily mailings from the customer service call center, ads and messages are printed on the conventional paper-based statement and the rear flap of billing envelopes, and more banner ads are being posted on regional web sites.

We’ve also used outdoor billboards along major highways. Plus, our efforts are being supplemented by Pitney Bowes docSense marketing experts in the form of newspaper ads, contests, additional news releases, articles and news items in the company’s customer newsletter.

As consumer adoption of e-billing grows, UI’s customers will benefit from our significant head start. We have already added a great deal of functionality to make the process easier for them. We’ve added features to make visits to our website of greater value to them. It’s a win/win scenario, and it doesn’t get much better than that in a business to consumer relationship.

About UI
United Illuminating is a regional electrical distribution utility providing
electricity and energy-related services to more than 318,000 customers in the Greater New Haven and Greater Bridgeport areas. The company is based in New Haven and the stock is traded on the New York Stock Exchange under the symbol UIL. For more information, visit www.uinet.com.

The Right Partner Can Turn the Promise of Internet Billing into Reality Quickly
“We were excited by the potential of Internet billing from the moment we first learned about it,” recalls Shirley Dion, Senior Manager of Collections for United Illuminating Company. “But we also wanted to move quickly and didn’t have the internal resources to develop or implement the technology.”

The key was to find a partner that was knowledgeable and flexible, and could offer UI a “single point of contact” to ease the task of managing a fast implementation as well as the continuing flow of enhancements and upgrades.

Since UI already relied on Pitney Bowes for paper-based billing, which was handled on an outsourced basis, it seemed logical to turn to the mail and messaging giant for Internet billing as well. Which is how UI came to “partner” with docSense and rely on its innovative Digital Document Delivery (D3) capability.

D3 is especially beneficial to established firms such as UI, says Karl Schumacher, president of docSense, because it enables them to format documents for presentment to customers via the Internet or alternate channels "without altering billing and statement production applications at the mainframe."

And when coupled with an easy-to-use payment option, D3 enables high volume mailers "to lower the cost of distributing bills, accelerate their delivery to near instantaneous status, simplify and speed payments, and boost the value of the electronic message by tailoring hot links, banner ads and attachments to specific customer profiles," he continues.

Another key benefit of D3 is the ability to assure delivery, which is an important consideration for firms that must comply with government regulations concerning prompt notification.