Are You Working on Yesterdays, Today’s or Tomorrow’s Work?

With the pace of change in the debt collection industry over the last 5 years I will bet you’re still working to comply with client requests from 2014. Well I guess that’s where you are and that’s OK except for one big factor; there are a few agencies and law firms that are working on tomorrow’s policies and strategies they are outrunning you every day.

Surveys I conducted five years ago showed that CEO’s and managers received their knowledge and stayed up to date with industry trends mainly through attendance at conventions and by keeping up with a few key industry websites. My most recent surveys indicate that those same individuals now get their information and education from websites and client requirements. The requirements from their clients seem to be more restrictive and demanding than the actual regulations passed by the State and Federal governments. So now, many agencies are reactive to all the demands of regulators and clients and not proactive to the direction of the industry or marketplace.

As I stated a few months ago in the article “What will collections look like in 2020?” the industry is moving rapidly to an electronic communication strategy, and away from a human collector based strategy. I predict that in 5-8 years, the majority of all contacts and collections will be made through electronic, non-human interfaces and that these channels will represent the vast majority of collections. Those agencies and debt buyers who are focusing on these technologies and strategies today, will have a distinct advantage over their colleagues years down the road.

Unless you have a time machine and can go back in the past and change history like Marty McFly So if you’re working on yesterday’s projects today, how do you make the time leap to working proactively on your company to meet the requirements of tomorrow’s marketplace? Well you’re going to need two things:

  • A plan – You’ll need to follow a plan that is precise and has as much forward looking as possible but also meets today’s and yesterday’s  requirements of your clients and business. This plan may require any months to build and will require a industry visionary to help you create and execute it.

2)  Technology and Knowledge – You’ll need to identify and vette various technologies and have a good amount of brainpower on the team to get the plan launched and implemented correctly. Technology will be a large hurdle that can be overcome but the company needs to look long term to make sure that are deploying the right technology. This will also require a team of visionaries from each department and a strong leader to manage the projects to completion.

The time warp can be created by using intelligent, willing people and high technology but it will require lots of teamwork and a visionary leader that can get the vision across to the team and manage its progression. If your office needs help to make that leap Lighthouse Consulting can help.

Learn how to increase your right party contacts rates by 100% today

Take a look right now on your OPS Dashboard, phone system, dialer, or just walk out on the collection floor and tell me what percentage of your staff is talking to a RPC (Right Party Contact). 10 percent, maybe 25 percent if you’re working really good paper. What does a 10 percent increase in contact ratios do in a day, week, or month? It will likely increase revenue by the same percentage.
So what does a 50 percent increase in RPCs do to your revenue in a day, a week, or a year?

Watch a video here 
What if your best-trained staff were spending their time working 50 RPCs daily? What would that do for your revenue? 
So the question remains: How do you increase RPC ratios per experienced staff member?

  1. The first thing you need to do is make sure your staff has all the tools available to make many RPCs daily, such as an advanced phone system, software that speeds up the process, scored portfolios, and anything that increases the ability of the staff member to make more calls.
  2. Next, you must find a way to make sure you are feeding the right accounts to the collection staff to call by scrubbing, skip tracing, and verifying the numbers the highly-paid and highly-experienced staff you have built are dialing. By doing all this, you can make sure the data is correct and has the best chance of a RPC for the staff to call. You have a responsibility to segment these tasks, not task your collector with skip tracing, verifying, and scrubbing the portfolio assigned to them to get higher RPC ratios.
  3. You can achieve most of the above by hiring a CALL TRANSFER AGENT that is tasked with getting the consumer on the phone and professionally transferred to your waiting experienced staff member for collection.  In the past, the problems associated with transfer agents have been accents and drop rates, which reduced overall success rates of the campaigns.

There have been improvements in the overseas call center transfer agents over the past decade, but most people have been doing this within their own organization by hiring lower-paid staff to make the calls and transfers. I have seen this in both law firms and collection agencies, but the cost is still sometimes prohibitive coupled with the turnover of staff in an entry-level position.
What if I could tell you I have a U.S.-based call center that can perform the warm transfers to your experienced staff? What if I told you I could deliver the following:
With FIVE callers from U.S. call centers
No foreign accents or cultural challenges
Seamless increase of agents with no turnover issues
Successfully dial 400 numbers per hour
Successfully contact 40 RPCs per hour
Get 92 percent of those RPCs to a successful transfer
@ a cost of just $70 hourly or $14 hourly per agent

With TWENTY FIVE callers from U.S. call centers
No foreign accents or cultural challenges
Seamless increase of agents with no turnover issues
Successfully dial 2000 numbers per hour
Successfully contact 200 RPCs per hour
Get 92 percent of those RPCs to a successful transfer
@ a cost of just $275 hourly or $11 hourly per agent

The increased RPC ratio should
Increase the number of outgoing calls made daily by 150 percent
Increase the revenue by 10-50 percent

Call me for more info at 904-687-1687 Phillip W. Duff

What Does the Future of Collections Look Like in 2020?

Here is my version of ‘1984” for the collection industry. 2020 is just a few years off and with the direction and level of change in the collection industry here is what I perceive the industry will look like in the year 2020.

First; TCPA reform will allow collection agents to contact consumers on their smart watch or some other yet to be invented device. So let’s look at a normal account flow in 2020.

Dental Office Account for $1,000 Placed with Agency after 90 Days Delinquency

Day One

Email and text sent to consumer with the following:

  1. a) disclosures;
  2. b) a link to an online interactive negotiating website;
  3. c) no contact phone number is provided to contact the collection agency;
  4. d) a link is provided in the electronic communication to file a dispute within 30 days.

After the IT department launches the text and email campaign, the marketing automation system, using artificial intelligence based machine learning, begins to analyze the interactions of the consumers to the text messages and emails. Depending on the timing and frequency of the consumer engagement, and the devices they utilize when responding to the campaigns, the collection automation system then begins to build follow up campaigns created in real time, utilizing the most likely communication channel through which the consumer will engage. These follow on communications campaigns are created and optimized with compliance rules and conversion goals at the heart of the analytics model

Days 2-4

Based on the actions, or lack of actions, over the previous 24 hours, the collection automation system now begins to optimize and expand the contact strategy, introducing new contact channels to the strategy. In this stage of the campaign, expanded contact options such as a collector chat/assistance option or a “Click to Call”button are introduced to some, but not all consumers utilizing the web payment system. Based on certain actions performed by the consumer or inferred by the system during the web session, such as payment intent or exit intent, new communications options are presented to the consumer in the web payment session based on their actions or perceived intent. As consumers interact with different communications tools, the system identifies patterns and measures actions against predetermined collection campaign goals, and provides attribution to the different communication channels, giving credit to assisted conversions across the different engagement channels utilized. By measuring the number of touches, and identifying the different channels the consumer engaged with, the collection automation system will continue to learn and optimize the most effective strategies.

Days 5-10 

Over the next 5 days of the campaign, the collection automation tool will now begin to incorporate selective outbound calling campaigns, but tailored to actions in near real time that identify a consumer’s likely intent to engage. Based on actions such as opening an email for a second or third time, visiting a payment site and viewing offers but exiting without making a payment, or visiting the payment site or opening the email from given type of device such as a mobile phone or desktop device, the marketing automation system can direct the dialer to make an outbound call to the most likely number the consumer will answer based on the device they were previously using. The system might also opt to just send a text message to the consumer directing them back to the payment site for a new set of offers available only for a limited time. This one-to-one contact strategy is designed to present the right offer, on the right device, at a time that the consumer is most likely to receive the communication and be able to act upon it.

The Collection Manager of 2020

In the new data driven collection environment, managers will view portfolio performance with a new set of metrics, balancing total liquidations against channel cost and time decay. Managers will leverage multi variant testing tools to develop complex champion challenger tests, constantly testing every aspect of each communication from verbiage, to color, to logo placement and even designing dynamic messaging down to the recipients preferred email provider or device model. This begins to look like marketing at this point instead or collections.

Testing will become a science in and of its self with complex champion challenger tests designed to squeeze the maximum number of basis points of liquidation from every file. The collection manager of 2020 will be data scientist first, and collection specialist second, with a strong background in direct to consumer marketing functions. The collection managers of tomorrow must be focused on the science of consumer engagement first in order to compete with the constant barrage of messaging and communications consumers will be presented with in multiple channels.

The Connected Society of 2020

Credit bureaus will be forced to become more responsive, leading to the requirement to add and delete records in 24 hours or possibly in real time. Credit applications will be originated using electronic applications or device based apps, virtually eliminating the need for paper applications. Consumer communications will be almost exclusively electronic as society moves to a near 100% connected status.

Durable goods and large ticket items will be enabled with GPS communications and location tracking systems that allow remote diagnostic and servicing as well as lockout and disable functionality in the event of non-payment or default. Retail brick and mortar establishments will continue to suffer as consumers make more purchases through online outlets and rely on retail locations for same day Pick Up convenience or showroom services.

In the connected society of 2020, hard currency will become almost non-existent with biometrically protected mobile wallet applications replacing the need to carry currency or credit and debit cards. Barriers of language that exist today will be gone in 2020 and reading anything in another language will be as simple as snapping a photo on a cell phone or looking through the viewfinder on a camera.

Massive personal databases housing all types of information on millions of Americans will become connected and consolidated, aggregating personal, financial, medical history, genomic/DNA, lifestyle and behavior data that will be accessible by the government, employers, insurance providers and financial services companies under the auspices of protecting consumers and the nation. A medical diagnosis or treatment immediately updated in this database may automatically trigger a search for DNA or other genomic information to treat the condition or simply implement an abatement of collection activity against a person with an outstanding debt.

As communication changes from personal to electronic over the next few years, the few agencies and law firms that embrace that technology will be the big players in 2020, the ones that shun technology as a collection tool will fade away. If you’re interested in learning which of these tools now exists and how you can get on board call Phillip W. Duff CEO of Lighthouse Consulting today at 904-687-1687.