How many forms of communication have you used in the past week? If you’re like many people, you might’ve used:
We live in an era where multi-channel communication is the norm. Sure—we might have preferred methods of communication—but, on the whole, there are a myriad of ways to reach any one individual.
Companies are starting to wise up to this. If they want to drive customer loyalty, improve the customer experience (CX), and ultimately boost their revenue, they need to embrace serial multi-channel communication. With digital payments quickly becoming the accepted norm, lenders in particular must adopt digital-first communication practices when entering into a dialogue with their customers.
In this piece, we’re going to explore why multi-channel communication is absolutely necessary nowadays, what’s needed to set up an all-encompassing multi-channel communication strategy, and the potential return on investment.
It’s easy to see why multi-channel communication has quickly become the norm. People are more accessible than ever—our smartphones alone receive texts, calls, emails, push notifications, WhatsApp messages, and social media messages. These days, there’s no one de-facto method of communication. If someone isn’t reading your Facebook messages then you simply send them a WhatsApp, or vice-versa.
But there’s more to multi-channel communication than simply accessibility. People oftentimes might read a message and quickly forget about it. Perhaps they’re commuting back from work at the time, or about to nip out to go do their weekly groceries, or are just about to walk into the cinema. When it comes to collections, companies might feel like their past-due customers are actively ignoring them. This might well be the case for some people, some of the time—or perhaps they’ve just forgotten about your message despite their best intentions.
Consider this: the average millennial now has an attention span of merely 8 seconds. Imagine that the recipient only thinks about your message for 8 seconds (if they even see it at all, that is). It’s soon going to recede to the back of their mind once they find something else to focus on.
However, there’s no need to despair—instead, you just need to focus on sending the right message, at the right time, to the right person. When you do that, the consumer will be far more likely to go ahead and repay. According to Andrew Beatty, Head of Strategy & Banking at FIS, effective digital communication in banking boils down to three primary elements:
Once you’ve ensured that each message meets these three criteria, you then need to combine them with a serial multi-channel communication strategy. Persistence is key. A text message might be read and then forgotten about. An email could flash up before disappearing in an ever-increasing inbox. Letters through the door might be left unopened, while telephone calls may simply be ignored.
Of course, that’s not to say that telephone calls and letters are completely obsolete. There may be instances where it’s beneficial to send paper late-notices. You might find, for example, that boomers generally prefer to receive letters through the door than to be texted or emailed. Telephone calls may also work well, though it makes sense for your collections agents to spend their valuable time chatting to high-value customers as opposed to low-value ones.
With the right collections management software in place—in other words, one that meets the expectations laid out in our 2020 Buyer’s Guide to Collections Management software—you’ll be able to decrease the amount of low-value calls that your team has to make. This, in turn, will leave them free to focus on high-value past-due customers.
Digital communication channels carry a multitude of benefits. First, they’re far easier to track and analyse—you never know if your letter was ever opened (or even received by the intended recipient), while you can easily track SMS and emails. This allows lenders to focus on strategies that they know will genuinely work, relying upon insights derived from past performance.
However, that’s not all—analysis is just the first step. As explored in The Future of Collections in Banking, the ultimate goal is for lenders to use digital communication strategies to increase their repayment rates. So how do multi-channel communication strategies perform when implemented?
The results are staggering.
For example, according to a CGI report: “…one analysis shows the combination of automated voice messaging and text messaging increased the collection’s success of one card issuer by 400%.” A well known UK based bank implemented a thorough multi-channel outreach strategy that included rich media messaging (RMM), interactive voice messaging, and SMS text messages. As a result, they achieved a 200% higher contact rate with past-due customers while using 60% fewer agent resources in the process.
There have never been more communication channels to choose from. Despite this, it sometimes feels harder than ever before to get in touch with your customers. So how can you create a successful ongoing dialogue? By using serial multi-channel communication.
Attention spans are dwindling. This means that persistent, regular reminders are quickly becoming the accepted norm when it comes to collections. By implementing a well-thought-out digital communications strategy from the get-go, you can enter into an ongoing dialogue with your customers and reduce the likelihood that they’ll repay past their due date.
These days, customers might miss an email here or an SMS there—so you can’t simply rely upon one message, at one time, on one channel.
Embrace the future of collections by adopting a multi-channel communications strategy. To learn more about how to put this into practice, keep an eye out for our digital workshops on best practices in modern debt collections. Feel free to subscribe below to our blog to get the latest updates.
Collections has never been more important. In the wake of COVID-19, the number of non-performing loans looks set to skyrocket across Europe. Indeed, it’s predicted that the total number of NPLs will...
2020 has been disruptive in almost every sense of the word. E-commerce has swept aside physical retail. Daily commuting, once a reality for most people, now only affects a select few. Customer service...