British Gas claims Nectar and Sainsbury's partnerships paying off

British Gas: partnership deals are paying off
British Gas: partnership deals are paying off

British Gas has claimed its partnerships with Nectar and Sainsbury's are helping it take market share, but warns customers are reluctant to buy services in the current economic climate.

The utility provider increased its residential energy customer numbers by 159,000 to 16.1 million over the first six months of the year, though it lost 12,000 gas customers.

It claimed sales were particularly strong in the second quarter due to competitive pricing and having made 100,000 sales through Nectar and Sainsbury's. The two partnerships were agreed in September and January.

The company said: "These channels are delivering high value customers and the Nectar scheme is helping to shape customer behaviour, with more customer now submitting meter reads online, moving to paperless billing and choosing to pay by Direct Debit, with the incentive of receiving additional loyalty rewards."

However, it also admitted it had been unable to grow the amount of service contracts in the first six months of the year, saying expenditure on these products was viewed as discretionary by some consumers.

Residential supply operating profit for the period dropped from £585m in 2010 to £270m, "as the favourable combination of extremely cold weather and low wholesale commodity costs experienced in 2010 was not repeated".

Residential services operating profit increased slightly from £109m to £111m.

Yesterday British Gas was fined a record £2.5m by the energy regulator Ofgem for having dealt poorly with customer complaints.

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