EXUS Collections & Recovery Blog

How Collectors Can Get Better at Customer Service

Posted by Theodore Kavalieros on Thu, Nov 10, 2016 @ 11:00 AM

Customer_support_2.jpgCustomer service doesn’t get the attention it should in collections circles. After all, “customers” in this case are usually debtors who owe the organization money from one or more obligations. Why would we focus on anything other than collecting as much as possible, as quickly as possible?

That used to work, but it doesn’t anymore. Collections has changed. Consumers carry multiple obligations with multiple providers. Debt products can be extremely complex. And organizations face more competitive pressure than ever, meaning they don’t win repeat business by default.

That makes customer service a key competitive advantage—even in the collections business. Today’s debtor could be tomorrow’s repeat customer when their situation changes. They’re also more likely to settle with the organizations that treat them best.

The organizations that place customer service first stand to reap the rewards. Here’s how your collections team can get better at customer service, starting today.

Collect Data 

To get better, you need to determine where you currently are. Collecting customer satisfaction data in some form is a must. Solicit customer feedback using a simple online form or rating system. Even rudimentary scoring will help you understand how well customers rate your collections performance. (It may be as simple as having them rate each call with collectors on a scale from one to five.) 

Once you have a few weeks or months of data, set aggressive improvement goals. While every goal you set should be achievable, it doesn’t hurt to set loftier goals for customer service improvement. If you’re at an average 3.5 rating on customer calls, set a goal to average 4.0 (a 14% improvement) for next quarter.

Conduct Regular Feedback and Improvement Sessions 

Now that you have benchmark data, it’s time to act on it. Conduct regular sessions to analyze data and customer feedback with your team. These regular check-ins will help you all stay on the same page and address issues before they become intractable problems. The sessions will also serve as a reminder to collectors that customer service levels are a top business priority, not just a value the organization pays lip service to.

Segment Customers

Customers fall into different groups and share different characteristics. They use different channels to communicate and do business. And they have differing levels of debt and obligation types. So why are we treating them all the same? The old one-size-fits-all approach to collections no longer works. What’s worse, it’s clear to consumers that the organizations that use it aren’t trying all that hard to preserve their business.

Customer segmentation is key to customer satisfaction. By segmenting customers by behavioral or static criteria, organizations can then craft communications and approaches that actually serve a specific customer’s needs, rather than treating them like someone with a completely different situation. 

Take a Phased Approach to Collections

Once you segment customers, you’ll start to see that not everyone owes the same amount on the same timeline. Customers have multiple debt obligations with multiple providers, and may be in various states of payment or delinquency across them. That’s why a phased approach is a must to keep customers happy and produce results. 

There are four broad phases you can break collections activities into:

  • Soft — The initial stage of the credit / debt relationship.
  • Pre-Litigation — When the customer has become delinquent, but not so badly that litigation is needed.
  • Litigation — The stage where legal measures are taken to encourage settlement.
  • Recovery — When an organization seeks to reclaim at least some of the debt owed.

The Litigation and Recovery phases require a high-pressure approach that will likely do little to improve customer satisfaction. That’s because organizations should emphasize asset preservation over the customer relationship during these later stages. However, a high-pressure approach is not needed during the Soft and Pre-Litigation phases. By instead focusing on preserving your relationship with a debtor, you can improve customer satisfaction in the early phases.

Gain Context Into Each Debtor’s Situation 

A key pillar of customer service is to put yourself in the shoes of the debtor. Collectors can do that by discovering more about the context around a debtor’s delinquency. Today’s consumers have multiple obligations with multiple providers, and these products are sometimes complex. Ask questions about the consumer’s situation to learn more, such as:

  • Are you struggling with any other obligations at the moment?
  • What changed in your payment history that made covering this obligation difficult?
  • Are you having any trouble resolving other obligations?
  • What would be most advantageous to you as you work to resolve obligations?

Asking about context is a win-win. On one hand, it strengthens your relationship with a customer, improving customer satisfaction. On the other, it provides you with valuable information that may help you reach a better settlement faster.

Provide Self-Service Options

Collections self-service portals offer customers the ability to reach settlements and provide explanations for delinquency in a completely self-directed fashion, without your involvement (unless the customer requests it). Don’t worry: this option doesn’t make you obsolete; it actually improves the customer service you provide. 

That’s because the market now demands self-service options that reflect the self-directed transactional options consumers have with their favorite online product and service providers. Self-service platforms give them web and mobile options when they want them, not when you feel like calling or emailing them. This makes settlements more likely, and improves customer service levels—since debtors can resolve obligations in the way they prefer.

How to Improve Your Results with a Self-Service Option 

Why should you adopt a self-service system? We break down the benefits in this free guide. Download it today to get a better idea of how self-service solutions can benefit your organization.

Theodore Kavalieros

Written by Theodore Kavalieros

Topics: Collection and Recovery Operations