CCR2 Technology Taking an energetic approach
One major energy company has seen significant benefit from an updated collections system
Matt Rowe Lead representative for collections, Esendex
matthew.rowe@
esendex.com
The historical problem with small amounts of final-balance debt is that the cost of chasing the payment frequently exceeds the value of the debt. This was the challenge issued to us by a
‘big six’ energy company. Their existing system, of sending a letter, was falling short, not only because of the cost, which prohibited them from making more than one attempt at contact, but also because 55% of customers, with final-balance debt, had cancelled their account because they had moved home.
Prerequisites Their prerequisites for an alternative method of debt collection were that it should: l Promote friendly, fair, and non-intrusive contact. l Allow customers to self-serve via digital channels, so that the cost to serve is reduced. l Reduce the strain on their call-centre agents. lWork in the most cost-effective way, based on available customer contact details. l Be self-managing; if a payment is made, or a message fails to be delivered due to incorrect contact details, the solution should update itself without intervention. l Work with the energy company’s existing software and communication channels. The information available about each
customer was: l Their reason for leaving. l The amount outstanding. l Contact details.
Decision engine Using this data, the Esendex team built a custom ‘decision engine’, the purpose of which was to select the best channel for contacting the customer, and the appropriate message template. For example, we offered three communication channels: SMS, e-mail
July 2017
and automated voice. E-mail is the least intrusive, and allows the provider to present the widest range of payment options, but equally it is the easiest to ignore. It is a great choice when the value outstanding is small, and so the cost to the energy company of not receiving payment is at its lowest. SMS has the benefit of an extremely high
open rate – 98% compared to 20% for e-mail – and a significant proportion of responses occurs within 15 minutes. It is harder to put across a more ‘nuanced’ message over the short form message, but not impossible. SMS became the default contact method because of its effectiveness at soliciting a response. Voice is the most intrusive option, so it
was reserved for customers who both owed the greatest amount, and were unresponsive to previous attempts via e-mail and SMS.
an automated voice call. If, at any time, the communication method ‘bounces’ due to incorrect contact information, this is fed back to the energy provider, and there will be no further attempts to utilise that channel until the contact details are updated. In order to reduce costs and strain on call-
centre agents, three methods of self-service payment were provided: an IVR, mobile web app, and an online payment portal. The first two of these were supplied by Esendex, whereas the last was the energy company’s existing system; all of them feed notifications of payment back into the workflow, so that any further attempts to chase payment are prevented. The energy company also had a ‘kill
list’; by placing a file in a secure location, customers could be removed from the automation at any time. Detailed analytics built into the workflow
Detailed analytics built into the workflow have allowed the energy company to establish a clear cost to serve, areas where further optimisation might be required – for example, changing the message template – and to calculate their ROI
Feedback loop The feedback loop is essential to the effective operation of the workflow. If the first attempt at contact via SMS does not generate a response, then the customer will receive an e-mail. If this does not work, they will receive
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have allowed the energy company to establish a clear cost to serve, areas where further optimisation might be required – for example, changing the message template – and to calculate their ROI.
The outcome? l 19% of customers approached for payment through the new workflow made a payment, compared to 4% with the previous workflow. l 82% of payments received were for the full amount owed. l In year one, to recoup £1 cost £0.42; in year two, because the setup costs are removed, it will cost just £0.20 to recoup £1, paying for itself after two months. This was made possible because of the
energy firm’s knowledge of their customer base, and Esendex’s expertise in eliciting a great response through mobile optimised communication channels. CCR2
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