The Pathway to Collections Success
Creating customized customer treatment paths is key not only to prioritizing collections by value at risk, but it is also essential for optimizing the use of your agents and their rates of success in moving customers from delinquency to remittance
There is a traditional image that comes to mind when considering first-party collections. It’s of an agent, using an automated dialer to call a customer after 6 p.m., because by that time he or she should be home from work. In the time between the dialer making the call and the customer picking up, the agent decides on a course of action to take, based on the account information that has just popped up on the screen.
When presented like that, and when considered in the light of the technology that is now available to aid organizations in every aspect of their business operations, this picture starts to look in-effective.
Times have changed
Thankfully, organizations have started taking steps to improve their traditional collections operations. For instance, it was a widely held belief that the longer an account was overdue, the less likely the balance could be recouped in full, so companies would set up their collections operations to target those customers who were less than 30 days past due to prevent further arrears or a debt becoming out of scope.
Organizations have now come to the realization that collection efforts and therefore agents’ time and talents, should be segmented based on the amount of value at risk, rather than days of delinquency.
Focusing resources on the largest potential remittances makes economic sense. Each interaction with each of your customers has the potential to yield numerous calls to 20+ customers over the course of several days.
Yet, even with intelligent portfolio segmentation, unless the organization also segments customers within each collection bucket, the operation will fall short in terms of performance. Assigning a blanket treatment to all customers based solely on the value of their outstanding balances or the number of weeks of delinquency could still result in an organization spending more on its collection activities than it recoups from settlements or promises to pay.
One size does not fit all
Two customers may well be identical in terms of amounts owed and the number of payments missed, but one will pay and the other won’t or can’t. Yet data given to agents based on portfolio segmentation will indicate both these customers are the same and therefore need the same approach. One size does not fit all. Different customers need different strategies and formulating those strategies is only possible with data analytics.
Structured and unstructured data
The same data that’s running through an organization’s systems and flowing across the major social networks and that is already being combined and harnessed to build customer insights to improve marketing, customer journeys and companies’ offers, products and services, will also give you the insights you need to segment customers for collections success.
Applying data analytics to delinquency
Taking these rich insights and overlaying them with portfolio data, the patterns and behavioral cues will emerge for creating specialized customer treatment paths – approaches that people will respond to.
With this information, you will understand which customers prefer to interact via digital channels – so no time is wasted in making phone calls – which customers will react positively to an automated nudge, such as a text message with a payment link – and which customers are going to require a high-touch approach including voice calls, in order to get back on track.
In turn, this will optimize how agents are deployed and on which accounts. Customers can be assigned to the agents with the request skillsets for reaching a positive outcome while at the same time treatment paths can be clearly defined that like customer journeys minimize friction and optimize ease.
Drive constant improvement
All of this also presents huge opportunities for automation – be it via SMS or email prompts or directing customers to a self-cure portal on the website – which in turn drives down costs while driving up agent performance as they’re free to deal with the customers who need the most interaction.
As collections campaigns get underway, using speech analytics to monitor call quality and identify gaps in agent training, as well as positive or negative emotional sentiment expressed by customers during interactions leads to even greater insights. These findings are fed into the system to continually refine existing treatment paths, identify new opportunities and to constantly improve performance.
To learn more about how technology is changing the face of collections and to understand how Sitel Group’s Smart Collections can increase your collection success while improving customer satisfaction and reducing costs, watch our webinar.