Does a digital-first debt collection strategy mean digital only? | Flexys

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Does a digital-first debt collection strategy mean digital only?

by Paddy Gilling

Earlier this year, I attended the Money Advice Liasion Group’s South West meeting and presented a talk about digital transformation within collections and customer service. As well as the obvious benefits to customers– time-saving, reduced embarrassment factor, anytime/anywhere availability etc– I also raised some of the potential pitfalls of ‘going digital’ and the risk of isolating and under-serving non-digital customers. 

Recently, after a Utility Week customer workshop, Elizabeth Errington, Citizen’s Advice policy manager, tweeted:

‘One of the concerning features of the future vision for energy and water is the focus on a digital first journey. This can pose real problems if it means the complete removal of traditional contact methods.’

Digital engagement is often presented as an ‘all or nothing’ venture but research shows that digital preferences are much more nuanced than we think and that there are factors within the control of organisations that can both extend digital engagement and make sure non-digital customers are not excluded from the best service standards.

Taking a look at the digital experience of Millennials can be illuminating and provides valuable insight for all customer service providers. Millennials famously dislike using the phone. This is mainly because it’s time-consuming (think call waiting times and confusing menus). So, it follows that using Elizabeth Errington’s example, Millenials are prime candidates to migrate to digital-first energy suppliers.

 But if you look more closely at the graph above, you can see that challenger companies like Bulb and Octopus, for example, are also much better at answering customer calls quickly when compared to the big six suppliers. It’s a win-win for them. They attract digital-natives but they also serve all customers more quickly and these two factors are connected. 

So, what are these companies doing right that enables them to serve both digital and non-digital customers so effectively? 

The answer is they make it easy. 

It’s often wrongly assumed that modern interfaces are offputting to customers with low digital skills or low digital confidence levels but this isn’t borne out by engagement results.

The image above demonstrates the needless barriers that many websites or portals place in the way of customer engagement. interfaces that are offputting, not only to those with low digital skills but also to digitally-savvy groups who value their time too much to wade through a system that is a struggle to navigate and isn’t personalised to their needs. After all, this is what we have become acclimatised to through our use of the likes of Google, Amazon and Facebook. If you add in admin anxiety or stress due to mental or physical health challenges, then you have a recipe for failure and when those disengaged (or rather under-served) individuals turn to the phone lines, there are too many like-minded people also trying to get through. Lose-lose.

I concluded that one actionable aspect of the digital exclusion dilemma is to ensure your digital offering is fit for purpose– and that means fit for all customers, not just the digital-natives. By extending digital engagement, organisations can choose how to allocate the newly freed-up resources. This could be extra advisors manning the phones to improve first time resolution for non-digital customers, or it could be extending help to customers in very difficult circumstances, who may have affordability issues or be in vulnerable circumstances. 

The knock-on effect of digital transformation can, perhaps surprisingly, be to improve services for that relatively small but important group of customers who currently do not have the means, inclination or the skills to engage. Furthermore, as business requirements change, so digital systems can be configured, easily and simply, to keep up with fluctuating or developing circumstances. This makes digital transformation a good investment, both financially, automating a wide range of routine but time-consuming tasks and as a consequence, freeing up capacity and resources for those who still like to hear a human voice. . Win-win.

Read more:
Helping customers in vulnerable circumstances: what is the role of collections technology?