The way in which you communicate with your customers really does impact the effectiveness of your collections operation.
At the heart of any collections management operation is the quality of the correspondence and, in particular, the tone of voice adopted with the debtor. In short, what you say is important, but how you say it has a critical impact on its effectiveness.
To help guide best practice in this area and provide areas for consideration when designing and implementing customer letters within a collections strategy, Experian commissioned a study to explore how consumers react to the words used to communicate with them about their debt.
Key findings:
- An appropriate tone, clear detail of the consequences and a conciliatory approach are effective in the early phases of collection
- Fees and charges and negative impacts on credit ratings were key motivators to pay
- Charges applied to an account for issuing a letter is disliked and likely to encourage many to contact the organisation to express their frustration
- After 3 months a strong emphasis on serious action is appropriate, including reference to legal action or debt collection agency involvement
- Support should be offered, wherever possible, to aid those in difficulty
- Letters should avoid an informal and patronising tone
- Lengthy letters have a low impact and are often not fully read, resulting in important messages being missed
- Use of red to highlight and focus on a specific point is effective
- Use of red to highlight more than one point is counter-effective
To download the entire paper* and view other best practice briefings, follow the link below to the global Experian Decision Analytics collections briefing papers page:
http://www.experian-da.com/resources/briefingpapers.html
* Secure download account required. You can sign up for one today – FREE.