Willingness to Pay: Principles for a robust study
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Water utilities have made a significant shift towards placing their customers at the heart of their operations. This is more than just improved customer service –at its core it means engaging with customers to understand their views, priorities and needs and then using these insights to inform decision making.
Unlike competitive industries, our customers cannot demonstrate what they value by voting with their feet and choosing their preferred water provider.
Willingness to pay studies are one of a number of techniques that utilities are increasingly using to understand customer preferences, decide what investments to make and to demonstrate the value of these investments to external stakeholders.
One reason that willingness to pay studies can generate credible values from water utility customers is that that when a water utility conducts the study, the participants know that their response could directly impact the bill.
While willingness to pay studies cannot answer all questions, use of the techniques have matured in recent years with many impressive case studies in the water industry. This document is for customer research, regulatory managers or anyone in a water utility considering these studies.
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