Increasing Customer Contactability

In this tip of the month we shall consider the best time of the day an organisation should phone its customers in order to increase the customer contactability.

Connect Rate vs. Customer Contact Rate
In order to increase customer contactability an organisation first needs to understand what is meant by customer contact rate. A number of collection departments overestimate the contactability of their delinquent customers simply due to a misunderstanding of the terminology used.

Organisations often, when referring to customer contact rate, actually refer to ‘connect rate’. The connect rate is the number of calls answered as a percentage of the number of calls made. The ‘customer contact rate’ on the other hand means the number of calls, where the collector speaks with the customer, as a percentage of the number of calls answered.

A question that is often asked is which rate is more indicative of contactability and consequently effective collections. One has to bear in mind that not every connect is answered by the customer. Any person can answer the call, e.g. a fellow employee, a friend, etc. A collections call can, however, only be effective if the collector speaks with the customer. This is generally so because only the customer can resolve the ‘out of order’ status of the account and only the customer can make an arrangement to bring the account back to order. It therefore goes without saying that the best indicator to measure contactability is ‘customer contact rate’ and not ‘connect rate’. The higher the customer contact rate the higher the number of promises to pay and the higher the number of promises to pay the greater the amount collected.

Recent benchmarking exercises conducted by PIC Solutions showed that the highest connect rate during a day was achieved early in the morning between 09:00am and 10:00am. When analysing the ‘customer contact rate’ during the same day a completely different picture emerged. It was found that the highest ‘customer contact rate’ was achieved during the night from 18:00pm to 20:00pm. Based on the results of the aforesaid study it is clear that customer contactability, in the environment in which the benchmarking exercise was conducted, will increase substantially if calls are made at night as opposed to early in the morning.

The outcome of the benchmarking exercise underlines the importance of organisations establishing the best time to phone their customers in order to increase customer contactability.

Making calls at the right time not only increases customer contactability but also reduces costs because the collectors do not have to phone the customers again. This in turn increases the capacity of the collections department to action more accounts, which leads to an increase in collections.

Charl Van Rhyn is a Senior Consultant at PIC Solutions, the largest customer management solutions company based in the Southern Hemisphere. He has over 8 years of credit and risk management experience as a practising attorney, specialising in collections during all stages of the delinquency life cycle. At MBD Attorneys, a leading South African debt collection law firm, he served both in the capacity as Director Litigation and Senior Accounts Executive. Key responsibilities included the management of key business relationships within the banking, financial services, furniture retail, telecoms, utilities and health & leisure industries. He holds a B. Juris and LLB degree from the University of Potchefstroom. He is an admitted attorney of the High Court of South Africa and a member of the SA Institute of Credit Management.

About PIC Solutions
PIC Solutions provides customer management solutions to a wide range of blue-chip organisations. We are experts in the fields of credit, risk and marketing and have an established track record of success powered by solutions.

For more information on how PIC Solutions can optimise the credit life cycle of your business please visit www.picsolutions.com.