Entry #2: Use a Marketing Approach to Debt Collection

 All companies need to collect their Accounts Receivables to be successful.  But that becomes difficult if we start treating our customers as delinquents or write-offs, which is happening more and more in this economy.  When you consider the cost to obtain new customers, isn’t it worth the effort to build a stronger relationship with your customer before they become delinquent?

Develop a Marketing Strategy for Collections.  In today’s collection model, we need to sell the delinquent customer on the value of paying the bill by framing it in terms of fiscal responsibility and openness.  Consider a multi-channel marketing strategy to create numerous favorable impressions.  This could include case studies of other successful customers, inserts, websites that provide helpful business tips, social media and more. It can’t be faked—you really have to care about your customer and develop solutions that work for them and your business.  Of course, that also requires listening, counseling, longer talk times and courtesy regardless of their initial attitude.

Start With Education.  Before you can collect a delinquent bill, your customer must be listening.  At Access we decided education was the best way to get them listening.  So, we created an unbranded website (www.whycreditmatters.net) to encourage our delinquent customers to learn about their credit, credit scores, bankruptcy, credit repair, debt settlement and more.  A “win-win” requires giving something in exchange.  Your gift is to educate your customer, and their gift is paying their invoice.

Offer Special Finance Programs for Delinquent Customers.  One example of compassion and flexibility is asking the customer to sign a confessed judgment in exchange for extended payment terms on an interest-bearing note.  Continue to ship to them during their struggle with tighter controls on new products.  This will strengthen your position in case of default and also assist your customer through a difficult period.  The company that stands by me during hard times and even continues to ship me goods is the one I’m going to be loyal to once I’m back on my feet.

If You Build It, Will They Come?  Your goal is to create a non-threatening helpful, friendly, and understanding environment.  Our multi-channel approach is designed to entice the customer to go to our site, explore their options, create a desire, and motivate them to action.  It should always be easy for the customer to contact you to pay their bill or discuss their situation (have you ever navigated your company’s website from your customer’s perspective?).  The more channels of communication you have available, the better.

And remember, your delinquent customer is not the enemy.

Best Regards,
Tom Gillespie
President
www.access-receivables.com
www.whycreditmatters.net
Direct  410-494-1751
Fax  410-583-8602

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About Dan Gallo

I'm a small business lifer, starting/running businesses since I sold seeds door-to-door as a kid in The Bronx. I've played guitar and enjoyed baseball since I was 5 (born a NY Yankees fan). Just prior to marrying Kim in 1983 I became a Christian. We have two sons; Daniel's a musician & social media expert with a smart, insightful sense of humor, and Adam who recently graduated from Brooklyn College double majoring in Creative Writing/Literature and Anthropology. Adam now works in the non-profit sector. Since 2002 one thing we love to do together is go on service/missions trips to Belize. We've collectively spent 60+ weeks in Belize with this missions organization http://twaw.org. I started my 1st company in January 1985, and been self-employed ever since. I sold my last company, Mentor Communications Group, in '04. After 2 years w/ the acquiring company I started The Allasso Group, LLC doing Small Business Consulting, Fund Raising/Capital Raise-up Campaigns, Sales Strategy, Outsourced Sales Agency work, & Digital Marketing Programs (Social Media, SEM, etc.) since April 2006. Notable projects: Hired as Small Business Advocate and Social Media Director for IBM's "Supplier-Connection" - Feb '11-Dec '13. Hired as COO to help turn-around late stage start-up software company myVRM. Jul12-Dec '13 Hired as CEO of CoupleWise.com, a Digital Health2.0 app, to write business plan, raise seed capital, & completely redesign and relaunch the app. Aug '16 I won a Finalist spot for MassChallenge UK's 2016 fall cohort in London from Sept thru Nov. Started Oct15 - Current. I enjoy helping turn-around struggling small businesses, and launching new business ventures. Feel free to contact me with opportunities.
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