How can you help your customers through the cost-of-living crisis?

Having to choose between heating and eating is a terrible situation, but it’s becoming all too common for some people in the UK. The cost-of-living crisis is squeezing incomes, making things even more desperate for vulnerable people living with financial hardship, and pushing many others into poverty for the first time.

What does it mean to be a vulnerable person?

To begin with, we know that all consumers are different, with a wide range of needs, personal characteristics, health, abilities, and skills. These factors, plus the impact of life events and external conditions, such as organizational behaviour, can place consumers in a vulnerable situation, increasing the risk of them experiencing harm when dealing with organizations.

Vulnerability can affect anyone at any time. It can be permanent, temporary or sporadic, long or short term. A consumer’s needs and abilities can change over time, particularly if the consumer is faced with an unexpected change of circumstance or a particularly urgent or complex situation.

Categories of vulnerable people

The most obvious categories of vulnerable people include those who are elderly, have a learning disability or mental health condition that makes it harder to make informed choices. However, the personal circumstances that can make someone vulnerable can also be temporary. For example, it might be someone who has just lost their job or experienced a close bereavement.

A vulnerable person might find it hard to manage their affairs or make ends meet. As a result, bills can go unpaid or the person might take out a loan to cover the shortfall. Consumers might find themselves in a negative spiral. Financial hardship can lead to mental health difficulties, relationship breakdown, illness and homelessness.

What does the cost-of-living crisis mean for vulnerable people?

With inflation at a 40-year high, life in the UK is getting more expensive.

The cost of energy has gone up dramatically, with domestic gas rising 95% and domestic electricity going up 54%. The energy price cap that limits consumer bills was raised 54% in 2022 from £1,277 per year to £1,971, with a further rise expected in the autumn. The cost of filling a car has also hit record levels, making transport more expensive.

The squeeze is felt across society. Almost 90% of British households have reported an increase in the cost of living, but the impact is harder on those who were already living on smaller incomes.

An Office for National Statistics Survey found that one in four people are struggling to pay the bills and 17% have resorted to credit cards and loans to get through. With the cost-of-living crisis expected to last well into 2024, organisations will need to find ways to support vulnerable customers.

What can companies do to help vulnerable consumers?

Of course, businesses cannot waive bills for large volumes of customers, but it is possible to design inclusive services that help to minimise harm.

For example, in a non-inclusive scenario, a vulnerable customer might not be able to afford to pay a bill. The company shows little understanding and exacerbates the stress by making them explain the problem repeatedly or incur additional expense by being kept on hold for long periods. Letters and calls chasing the debt increase the consumer’s stress.

This scenario is unpleasant for the consumer, but it also holds many downsides for the company. Employees could also become stressed or feel unsatisfied in their role if they have upset customers and are unable to help them. There is a risk of reputational damage if a customer’s situation is made worse by a lack of support, and consumers might accrue additional debt to the company which will not be paid.

Reaching out to customers

A better scenario would be that a company proactively reaches out to customers who are struggling, helping them to find more suitable tariffs or products to meet their circumstances or offering a payment plan to address debts. If the issue is dealt with promptly and sensitively, stress is minimised for both customer and employee, and the customer feels supported, respected and valued.

Reflecting the need for better guidance on consumer vulnerability, the UK standard BS 18477 was released in 2010 – pioneering how to identify and tackle consumer vulnerability. Now, an updated international version has been published to help businesses better support their vulnerable customers.

BS ISO 22458: guidance on inclusive service provision

BS ISO 22458 provides a framework to help organisations understand the underlying factors that make customers vulnerable, and develop processes to help with the problem. The standard helps with areas such as identifying vulnerability, inclusive design of products and services, and data collection, protection and sharing. It is applicable to all organisations offering a service, and can also be used by trading standards and local authorities.

Consumers do not always volunteer information about themselves, and it may take a highly skilled customer services professional to establish rapport and build a clearer picture of the situation. BS ISO 22458 gives organisations the tools they need to help staff understand and recognise vulnerability, as well as developing processes that help with the problem.

The standard also covers accessibility of services, for example by providing information in clear, concise language that can be understood by those with cognitive issues, English as a second language or literacy difficulties.

Using the standard can help your business as well as your customers. It can improve your organisation’s reputation, boost customer loyalty, and broaden your customer base, while ensuring staff feel valued, supported, and more confident in handling difficult situations.

Secure a 50% discount

If you are a third sector organisation and would like to buy BS ISO 22458, you can secure a 50% discount. Just call the BSI Customer Relations Team on 0345 086 9001 or email cservices@bsigroup.com to obtain your discount code to use in the BSI online shop.

Find out more about the new standard on our BSI Consumer Forum Conference and BS ISO 22458 launch page.

If you have any other questions about how standards like BS ISO 22458, BSI members can get in touch with the Knowledge Centre’s information experts.