AEP Focuses on Online Bill Payment, E-billing

by Eric Leiserson, Fiserv

To facilitate customer satisfaction and cash flow, utilities must make bill payment as convenient and simple as possible.

Utilities can enhance the customer experience and revenue stream by encouraging e-bill and online payment adoption. American Electric Power Co. Inc. (AEP), one of the nation’s largest electricity providers, has achieved successful paperless adoption by designing online bill payment functionality geared to customer preferences and by encouraging customers to stop their paper bills.

Headquartered in Columbus, Ohio, AEP consists of seven utility units serving more than 5 million customers in 11 states throughout the Midwest and Southwest. The company issues more than 51 million bills each year, making billing and payment a significant function within its operations.

In addition to being one of the most innovative utilities with a history of firsts in power generation and transmission technology, AEP is committed to putting customers first by providing superior customer service.

An AEP team identifies ways to enhance customer support and self-service. Acutely aware that online account access and billing and payment are mission-critical to customer satisfaction, the team looks across the company and to customers for insights to deliver improvements.

Understanding the Customer Bill Pay Experience to Build a Better Website

AEP was interested in optimizing its online billing and payment functionality. Before embarking on any changes, the company consulted its customers and conducted extensive website-usability testing. Customers who participated in focus groups expressed preferences for wording related to bill payment, access to bill payment choices and registration processes. By studying the user experience, AEP identified the following deliverables: single sign-in for account access and bill pay; simplified bill payment; streamlined registration; increased “findability” and an enhanced customer service functionality.

With a redesigned website and enhanced e-bill and online bill payment functionality, AEP is focused on supplying energy and providing customers with a better experience across all touch points. AEP depends on Fiserv as a single source of billing and payment channel technology. Together, the companies built a full complement of bill payment options, improved online bill payment for AEP customers and accelerated adoption of e-bills and paper turn off.

Making Online Bill Pay Easier

According to the “2011 Fiserv Household Billing Survey,” most consumers who visited a service provider’s website did so to pay a bill (see Figure 1). These findings align with the path customers took when they visited the AEP website. Eighty-four percent of AEP site visitors went to billing- and payment-related pages.

A disconnect occurred, however, for some customers. Although they could sign in and see their bills at the AEP site, they had to use another login to pay bills.

The key to improving online bill pay was elimination of the double login and perception of navigating away from the AEP site to pay a bill. Fiserv’s Biller Direct HV (BDHV), deployed as a hosted solution, provided the flexibility AEP needed to integrate robust billing and payment functionality with a more intuitive user interface. The solution eliminated additional logins and AEP customers’ navigating away from the utility website. The deployment let AEP improve its website’s look and feel, and it enhanced usability to address customers’ needs and preferences.

Campaigns to Existing Customers Promote E-bill Adoption

Most billers recognize e-bill institutional benefits, but consumers have been slower to adopt paperless billing than e-bill payment. Only 38 percent of consumers who receive bills online at a biller’s site no longer receive paper bills. AEP knew some customers had yet to turn off paper bills because of inaction or a lack of information. To help shift more customers from paper to e-bills, AEP designed an e-bill landing page that explains the environmental impact of e-bills and features a video. To make adoption painless, the website functionality enables customers to go paperless in just three clicks.

AEP also included e-bill messaging in new customer handbooks, newsletters and during its on-hold recording for customers in the call center queue. Paperless billing messages appeared on paper bills, envelopes and social media posts. Targeted email campaigns also were successful. As a result of educating customers on e-bill benefits and incenting them to try paperless billing, AEP encouraged more customers to discontinue their paper bills. Results varied by campaign, but AEP saw spikes in e-bill enrollment ranging from 28 to more than 400 percent during promotions.

Results: Sustained Double-digit e-Bill Enrollment, More

Since launching online billing and payment and an integrated marketing program in May 2010, AEP has achieved significant results. Compared with typical campaigns that deliver a one-time spike in activations, AEP’s e-bill initiatives have sustained a 45 percent increase in monthly net growth for residential paperless billings (see Figure 2).

In addition, AEP experienced a 24 percent increase in website visits during the online billing and payment campaigns (see Figure 3). The company also realized a 31 percent increase in logins by registered users during the campaigns. Customer website visits help the company promote other online self-service and marketing programs (see Figure 4). In addition to higher online bill pay adoption rates, increased website traffic and sustained e-bill enrollment, AEP saw improved customer satisfaction with e-billing and fewer online billing and payment-related calls to the customer support center.

Online Billing, Payment Pays Off

In less than a year, AEP generated and sustained double-digit enrollment figures for online bill payment and e-bill. Other utilities interested in making online billing and payment an enterprise strategy can look to AEP leadership for the direction and insight to garner internal support. To start, billers may follow AEP’s lead and focus on customer service; work with a proven partner to develop a comprehensive online billing and payment program that combines the best technology and cross-channel marketing campaigns.


Eric Leiserson is a senior research analyst at Fiserv, where he develops consumer-related e-billing and payment research, adoption strategies and marketing. He has conducted primary research projects and webinars in green marketing, consumer segmentation, longitudinal surveys, Web usability and focus groups. Leiserson also held marketing and sales positions at Unisys Corp. and Intuit.

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