Debt collection is a tough business—just ask the collectors! They know all too well that a successful outcome is not a guarantee. However, having in place an effective first party collection (or financial care) program can reduce losses, increase revenue and retain customers.
What does an effective financial care program look like?
It all starts by combining customer-centric principles with traditional first party collection efforts. True to being all about ‘care’, this approach incorporates the importance of delivering a positive experience throughout the customer journey.
An integral component of any successful financial care program, omnichannel contact solutions provide consumers with a top-notch, seamless experience, regardless of the contact channel they use—phone, web portal, chat or mobile. It’s been proven that omnichannel solutions improve customer experience across many industries, which is why companies are now leveraging them to deliver strong financial care performance.
Let’s take a closer look at how omnichannel contact solutions can improve collection results:
Break down barriers
According to a white paper by Certona1 entitled, “Discover the Power of Omnichannel Personalization,” more than 60% of American consumers who like to interact with brands do so through multiple channels. In fact, 48% of repeat customers and 33% of new customers hit multiple touchpoints before they make a purchase.
Similarly, an omnichannel contact solution for debt collection can help break down barriers between the customer and the brand. Omnichannel not only makes interactions easier, but preserves (or even builds) the consumer’s relationship with the brand; this can have positive results both during collection interactions and later, as a returning customer.
In a study by Retail Systems Research2, 47% of retailers said omnichannel customers were more profitable than single channel customers, a figure that has increased for several years. And this data is backed up by information compiled by Certona3 that found that omnichannel shoppers spend 20% more than multi-channel shoppers—who spend 15-30% more than single-channel shoppers. The net result is that omnichannel shoppers can spend up to as much as 50% more than single channel shoppers.
Additionally, omnichannel lets you leverage more cost-effective channels, like text messaging (also known as SMS) as opposed to traditional voice support, while still providing an exceptional customer experience.
Drive positive customer experiences
In a 2011 Customer Impact Report4, 89% of customers said they began doing business with a competitor following a poor customer service experience. Debt collection, particularly first party, is not only about collecting the debt, but about retaining the customer in the future. And to do this successfully, customer interactions must remain positive.
In today’s digital world, delivering an excellent customer experience means providing access to real-time communication and interactivity. In short, collection efforts must go beyond traditional contact methods such as phone, email and regular mail.
Not only does an omnichannel approach offer consumers the ability to communicate according to their preferred method, but through features like web chat, can provide real-time interactivity. This kind of interactivity can reduce repeat cross-channel contacts and lead to a more positive customer experience. In fact, according to eDigital Research5, chat has the highest rating (73%) among all service channels.
A financial care approach, which blends first party collections and customer care, is the best path to providing a positive customer experience while increasing collections recoveries. Using omnichannel solutions as part of a financial care program can help improve outcomes and should be a key strategy for first party debt collection efforts.
To learn more about how Alorica (through its subsidiary, EGS Financial Care, Inc.), approaches first party outsourcing, visit our financial care page.