Tracking Performance Data With Digital Debt Collection

By on October 21st, 2019 in Data Science, Product and Technology

Call centers are notorious for reaching hundreds, if not thousands, of consumers several times per week (and even several times per day!). The debt collection industry is plagued by the perception that collectors are relentless and uncaring, which makes resolving debts even more challenging. Digital debt collection strategies aim to alleviate the stress of incessant calling for consumers, and also provide unique, powerful solutions for creditors.

Collection metrics

Digital-first debt collection strategies provide creditors the ability to track and aggregate more objective performance metrics that help strengthen their collections strategy. Qualitative metrics from traditional call centers are still subject to the endlessly variable human element of a phone call. 

When outreach is entirely automated, it becomes easy to A/B test simple changes (new subject lines, different greetings, etc.) and determine which are the most effective. But how do we define effectiveness? At the end of the process, an effective collections strategy is one that leads customers to make a payment. 

There are a few key metrics that call centers use to drive customers to this end goal that can be easily supplemented or overtaken by digital collection strategies.

Calls per account and calls per agent

Traditional collection agencies, like any other sales call center system, track the total amount of calls made to each customer and by each agent on the team. When individual agents are responsible for contacting customers, they have to hit an outreach quota. This quota reflects directly back on the calls per account, or how many times an individual customer has been contacted. 

As agents are required to call customers and collect on accounts, the calls per account may increase to a point where customers feel overwhelmed and over-contacted (which can even lead to symptoms of anxiety and depression). At the same time, if countless calls are being made, and an account is not paying, there is a clear gap in effectiveness. 

One of the advantages of a digital debt collection strategy is that agencies can reach customers with relevant messaging at times that work for them. This can include hours in which call centers are no longer legally allowed to reach a customer—before 8am or after 9pm. With these legal limitations in place and the need for agents to meet quotes, traditional collections strategies encourage an artificial inflation of outreach numbers that may not be positive.

Hit rates, percentage of outbound calls resulting in promise to pay (PTP), and call quality 

Call volume is not the end-all-be-all of call center metrics though. Simply tracking output numbers isn’t enough when engagement is the key metric. Hit rate is defined as the total number of calls divided by number of those calls that are answered by customers. While this number can be helpful in narrowing which calls were more successful than others, it cannot reach the same level of detail as a full digital strategy.

In the case of a phone call, there are limited options once the phone has been dialed:

  • The customer does not answer
  • The customer answers but ends the call before promising payment
  • The customer promises to pay

Trying to understand what leads to a successful payment on a call is then dependent on the agent’s perspective. Digital debt collection conducted through machine learning is able to communicate using personalized and consistent content. Hit rate, PTP, and call quality analysis can then be expanded on, and performance can be measured by:

  • Email Deliverability
  • Email open rates
  • Link click rates
  • Website engagement (Including clicking on further links, filling out forms, viewing specific webpages, and more)
  • Online payments

These data points can help pinpoint where in the process a customer was lost, improve the next attempt at outreach with that data in mind, and eventually guide the account to a payment. With more data and longer periods of time, machine learning processes only continue to improve.

Updating your collections strategy 

TrueAccord takes our digital strategy a step further by looking beyond simply using digital channels and focuses on the power of machine learning to continuously improve our collections performance. We’ve come to understand that creating an effective, empathetic collections experience actually comes from creating a more analytical and AI-driven process.

With better visibility into performance, more granular data points, and more accurate reporting available than ever before, digital debt collection strategies strengthen the power of any collections team.

Industry Insights Webinar: Making the Most Out of Your Website

By on August 19th, 2019 in Industry Insights, Product and Technology

TrueAccord’s Julie Hughes, Senior Product Manager, joins Patrick Lausen of Convergence Acquisitions and Kelly Parsons-O’Brien of Pacific Credit Services on August 22, 2019 at 1pm EST to discuss the power of building your brand through you website. Here is the official summary from AccountsRecovery.com:

“Websites are windows into a company, offering a glimpse of what separates one company from another. Increasingly, for companies in the credit and collection industry, they are also portals for individuals to manage accounts and make payments. 

Managing a wide spectrum of objectives can be difficult for any collection agency website. In this webinar, sponsored by PDCflow, a panel of experts from the accounts receivable management industry will share their tips and tricks to help make the most of your website.”

Click here to save your spot now!

TrueAccord and the Future of Digital Debt Collection

By on August 6th, 2019 in Debt Collection, Industry Insights, Product and Technology

In January 2019, AccountsRecovery.net launched a survey of more than 100 companies in the credit and collections industry to “assess the penetration of digital communication tools and how much they are being used in the industry.” “Digital communication” includes channels such as email, text messaging, and web portals that work to reach to consumers. 

However, these channels are secondary to outbound calls and paper mail, practices that have remained unchanged for decades, even though 70% of companies believe that digital communications have had a moderate to significant impact on their collection rates! Updating these channels for the modern age can improve the collections experience for both the customer and collector. Let’s find out how!

Communication Channels

Email

According to the AccountsRecovery survey, more than half of the companies that took part in the survey are using email communication. A majority of respondents also said that they are sending emails to or receiving emails from fewer than 20% of their users. This means that 80% or more of their customers are regularly receiving calls from collectors to discuss resolving their debts rather than receiving digital communications. 

According to TrueAccord’s 2018 consumer survey, the majority of consumers using our site would rather resolve their debts online than through other channels. With such a large number of consumers interested in online engagement, it’s easy to see why we’ve leveraged digital channels to modernize the collections industry.

We use email communication as our primary form of contact at every stage of the customer lifecycle, and each message is customized for the individual.

Mobile and Text Messages

The prevalence of smartphones has made reaching out to users on their mobile devices an effective and essential channel for communicating with customers. Unfortunately, only 21.6% of collection companies are actively using text messaging as part of their outreach strategy! Even some of the largest agencies in the industry are only texting about ¼ of their customers. 

More than 65% of companies in the collections space that are not currently using text messaging as a channel are concerned about two things: a fear of being sued or not fully understanding what is and is not allowed of them. 

TrueAccord has taken steps to directly address these issues by hard-coding compliance parameters directly into our system, so we are able to securely reach our users where they are: on their phones. In fact, more than 85% of our web traffic comes from smartphones and tablets, and we are able to drive traffic to the right pages through push notifications on those devices. These notifications serve the same purpose as text messaging but are uniquely catered to that specific customer’s needs.

Web Portals

Portals and landing pages created for consumers should be exactly that: designed with them in mind. The vast majority of companies in the collections space have portals specifically designed for customers to manage their accounts, but 75% of those companies report remarkably low engagement through those pages. 

Creating an engaging portal means answering the question: “How can we make the experience personalized for the customer?” TrueAccord embraces this in its design methodology; Shannon Brown, TrueAccord’s Product Design Manager, says that our “we’re not pushing offers to them, we’re looking for information [about the nature of their debt] to customize for their needs.” Our design embraces our mission of giving consumer’s control of their financial health. 

You can learn all about TrueAccord’s design philosophy by listening to our full interview with Shannon here!

By focusing on developing interconnected, customized content that reaches users through multiple channels, we can reach consumers via email and mobile push notifications with the goal of bringing them back to our website. 

The debt collection industry at large has a long way to go to meet consumer expectations about financial services. Our machine learning algorithm optimizes which message to a customer to send on what channel, addressing those expectations and letting users manage their debt at their own pace. This is also why we work to provide our users with as much visibility into their debt as possible through easily accessible digital channels.

How TrueAccord Creates High Performing Compliant Content

By on July 31st, 2018 in Compliance, Data Science, Product and Technology, User Experience
TrueAccord Blog

In debt collection, the language one uses in customer communications makes a big difference on liquidation rates. At TrueAccord, compliant content is the lifeline of our system. We continuously create, test and revise our content to engage consumers more personably—which drives better results for our clients.

Our Goal: Create a Better Customer Experience

Communication styles in the debt collection industry are typically stiff and unapproachable. Most of the time, it sounds like “legalese,” which can be off-putting, if not intimidating, to many customers. TrueAccord has a digital-first strategy to debt collection, primarily with emails, supplemented by SMS and phone calls to effectively engage with our customers. We strive to make our content informative, actionable, and compassionate.

Our mission is to transform the debt collection industry by helping people regain their financial health. Thus, our content is written to reflect that. It’s not accusatory or condescending, but respectful and empowering. We focus on finding solutions and helping people by presenting options on how to resolve their debt.

How We Experiment with Content —and Continually Improve It

Our proprietary content management system (CMS) was designed to help us craft and edit content based on massive amounts of dynamic data. We track everything from the customer’s balance, creditor, where they are in the debt lifecycle, if they’re in a payment plan, and how long we’ve been communicating with them to craft customized emails.

We constantly run experiments to generate the right content for each person. We try new subject lines to see if we can get more people to open emails. We write different calls to action on our buttons to see what drives better engagement. We also consider how far a consumer has to scroll down in an email or a landing page to get to the call-to-action button. If something’s not working well, we try something else. And our machine-learning engine—which continuously learns from our experiences—helps us customize specific and customer follow-ups that resonate. All of these small experiments add up to get us very high open and click rates from customers.

How We Keep Content Compliant

The debt collection industry is heavily regulated and is inherently protective of consumers, as it should be. We always look at communications content through a customer-focused and thorough compliance lens.

Our system provides code-driven compliance, appending the appropriate disclosures and text to automatically comply with whatever is necessary for each user, such as debts unreported out of statute or specific state disclosures. Our compliance rules dictate the content parameters for each customer, making it easier for our content writers to focus on writing compelling content. And yet, because there is wide variation in our writing styles, syntax and payment options, our content is still engaging.

Our legal team gives our content a final review, and we get very granular to ensure the message is clear for every type of customer. We look at the actual message, the email layout and design (including button placement) and even the size of the font for our disclosures. We write content that engages customers but also clearly lays out the customer’s rights and responsibilities.

This process is highly collaborative. Our content and legal teams work in concert to continuously adapt new scenarios to see how different options might come across. Our communications library constantly evolves as we keep on improving our customer engagement.

Think About What You Can Say

Most of the industry is focused on what you can’t say, but they’re not thinking about what you can say. That’s why we spend so much time perfecting our content and why we end up with such great response rates and overall results.

How TrueAccord Scaled its Email Sends to Millions a Month

By on May 1st, 2018 in Data Science, Engineering and Data, Product and Technology
TrueAccord Blog

Scaling to sending millions of emails a month is a difficult task, and sending debt collection emails is exponentially harder. To prevent spam and abuse, email providers and infrastructure vendors developed tools and tactics that can easily hurt, blacklist, and eliminate not only the “bad guys” but also the uninitiated sender. Still, we scaled to sending millions of emails a month while enjoying high open and click-through rates that allow us to service consumers the way they want to be serviced (we use other channels as well, but focus on email here). We learned important lessons about scale along the way, through trial and error and calculated planning, and we’re sharing them today.

Challenges With Scaling Email

Email is one of the most penalized communication platforms. There are no filters or blockers or spam buttons when receiving a phone call, or picking up a letter from your mailbox, but email is equipped to keep the bad guys out and let the good guys in. ISPs (email inbox providers) design algorithms to keep the user happy and engaged, and an inbox full of spam is not very pleasant. Unfortunately, sometimes the algorithm gets it wrong, and what is actually an email with good intentions from a trusted sender gets filtered through as spam.

To further complicate the issue for email senders, each ISP has a different set of rules and regulations they filter for. What may be an acceptable email in Google is flagged as spam in Yahoo and vise versa. There is no clear rule book to refer to when attempting to scale emails to a very high volume. The algorithms are also always changing to react to real spammer behavior,  further complicating any attempt to create one clear step-by-step process for success.

The signals for spam prevention algorithms touch on many aspects of emails but include content, design, time, volume, and frequency of sending emails, consumer engagement, digital signatures, and many more. Getting everything right is complex, but if you get any of these wrong, you may find yourself indefinitely blacklisted and banned from emailing.

TrueAccord’s Unique Perspective

Operating in the debt collection space further complicates scaling emails. Even if consumers agreed to be contacted via email, they do not necessarily welcome them, leading to lower inbox placements than eCommerce brands. Despite this enormous hurdle, TrueAccord has similar engagement rates to that of eCommerce companies with up to 30% open rate and 14+% click through rates. IT took a lot of work and careful attention to detail to get us there.

TrueAccord uses machine learning algorithms to pick the best email to send to a specific person at the right time in their debt collections process. The team customizes content, time, and frequency of emails, slowly ramping up scale while monitoring performance. In addition, a lot of TrueAccord contact attempts are reactive, made in response to consumer action or feedback. Contacting consumers in context adds credibility and attracts consumer attention while they are still engaged, further improving their response rates. This close attention to detail coupled with engaging content and data driven targeting makes a significant difference. TrueAccord increases consumer engagement and signals to ISPs that its emails are legitimate, creating a virtuous cycle that improves inbox placement and consumer exposure to emails, again improving engagement.

Our Top Tips for Emails at Scale

We’ve polled our product and deliverability experts to offer you our top tips to follow when building a scalable email program. If you follow these you’ll have a better chance to replicate our success and experience engagement rates that will support, rather than hurt, your long term inbox placement.

Create Valuable Content

The most important aspect to scaling email is writing good content that looks reputable and is well designed. It’s important to earn the consumer’s trust and stay away from using words and phrases that trigger spam engines. TrueAccord accomplishes this by personalizing every email, and sending the right email at the right time during the debt collections process, while also passing every email through a robust approval process to maintain quality.

Consult Experts

Because consumer engagement and open rates are a cornerstone of our business practice, we work closely with a team of email deliverability experts and providers. They provide specific industry knowledge concerning each ISP and assist in the warm up strategy for each domain and IP address. Experts help audit deliverability programs as well as deal with ISP-specific challenges and knowhow.

Segment Domains and IP addresses

Utilizing segmented domains and IP addresses allows for growth and scale while limiting the risk to your reputation from a single mistake, which is one of the biggest traps for new email programs. TrueAccord segments email sends to manage sender reputation and distribute potential issues across multiple domains and IP so none of them see too many bounces or receive too many spam complaints, nor have a too high proportion of unopened emails.

Start Methodically and Slow

Scaling your program too early is heavily penalized even among high engagement senders. Most established companies who add an email strategy to an existing customer base make this mistake, which often cannot be undone. TrueAccord places strict limits on email volume growth to make sure ISPs don’t flag our systems.

This is especially important when starting out with a new client. When a new portfolio is added we will send a small group of several hundred test emails for a few days to measure general deliverability and bounce rates. This test cycle provides insight into the appropriate strategy to use for this specific portfolio. If bounce rates are normal, we can begin to send emails freely, but if the levels are higher than expected we’ll utilize high risk mitigation strategies.  

Measure Measure Measure

Set, measure, track. Data is the life blood of a scalable email program because you must track performance in of multiple indicators across multiple segments to detect any developing issue. TrueAccord created smart alerts that highlight engagement, spam issues, email features and other indicators across IPs, domains, receiver domains and several others. Together they provide us with a realistic view of how the program is doing as it scales, and where we may have opportunities for improvement.

It’s taken TrueAccord two years of trial and error and obsessing over data to scale to millions of emails sent each month. Our email scale will continue to grow as our consumer base and business grows, and we are confident that this strategy will support our growth.

How We Created Heartbeat

By on April 24th, 2018 in Data Science, Engineering and Data, Industry Insights, Machine Learning, Product and Technology
TrueAccord Blog

Sophie Benbenek, TrueAccord’s Head of Data Science, discusses the early days of building our machine learning based engine, Heartbeat, and how it has evolved since. Hear about our approach to machine learning, how we move from heuristics to statistical models, and other anecdotes from the early days of TrueAccord.

Scaling TrueAccord’s Infrastructure

By on April 12th, 2018 in Data Science, Engineering and Data, Industry Insights, Machine Learning, Product and Technology
TrueAccord Blog

TrueAccord’s machine learning based system handles millions of consumer interactions a month and is growing fast. In this podcast, hear our Head of Engineering Mike Higuera talk about scaling challenges, prioritizing work on bugs vs. features, and other pressing topics he’s had to deal with while building our system.

Conversion At TrueAccord: Tuning A Machine Learning Engine

By on April 3rd, 2018 in Data Science, Engineering and Data, Industry Insights, Machine Learning, Product and Technology
TrueAccord Blog

TrueAccord’s system is machine learning based, but every new product type requires a little bit of tuning to beat the competition. Hear our CSO and VP of Finance in this short podcast about the Conversion Team and what it does to make sure TrueAccord stays ahead of competition.

 

Using an Experimentation Engine to Improve the Debt Collection User Experience

By on March 27th, 2018 in Data Science, Engineering and Data, Industry Insights, Machine Learning, Product and Technology
TrueAccord Blog

Innovative automation processes are finally gaining traction in debt collection, as companies increasingly distance themselves from costly and unmanageable call centers. And now, with an eye on continuous process improvement, a new focus on experimentation is enhancing the way these companies recover revenue and create a more effective user experience. Experimentation engines – whereby various collection scenarios and features are tested and evaluated based on real-time data – empower creative and customized contact and offer strategies that improve liquidation as well as customer satisfaction.  

Typical Challenges for the Call Center Model

The traditional debt collection call center model faces multiple challenges. Because of their commission compensation model, collection agents often use aggressive tactics on the phone, pushing for an immediate lump sum payment, or a short-term installment option to speed payment. Even if the consumer picks up the phone at all (which in today’s smartphone culture is becoming far less likely), they feel pressured and may commit to a plan they simply can’t afford. The result is an installment plan that breaks, many times after the first payment, and consumers often charge back the phone payment because they felt antagonized about being pressured to begin with. The call center cost structure also cannot afford to support highly customized plans with irregular payment schedules, missing out on another segment of consumers. All of these add up to a significant disadvantage given today’s consumers and their financial needs.

Flip the System on It Head with a Machine Learning Based Approach
The modern approach to debt collection is omnichannel, digital-first, consumer-centric and leverages data and experimentation to determine the best course of action based on consumer preference and behavior.

TrueAccord’s system communicates with consumers automatically through a wide range of digital channels, including email, text and social channels. And because it’s digital-first and fully reactive to consumer behavior and preferences, it’s a far less aggressive, much more personalized collection environment that delivers superior results when competing with call centers. Historical data collected over several years, combined with machine learning algorithms that evaluate individual behavior and preferences, enables this highly targeted and personalized treatment. Two to three email interactions per week serve as a baseline, with added channels in support and reactive communications responding to consumer interactions when needed.

This approach is also highly collaborative, focused on educating consumers and treating them the way they want to be treated. When they’re ready to commit to a plan, they just view payment options online and choose the one that makes the most sense. The result is higher liquidation rates in the long run, higher payer rates, and higher consumer satisfaction that leads to fewer complaints.

Machine Learning Drives the Experimentation Engine

The most important asset in the TrueAccord model is the data collected and analyzed over time that enables us to accurately predict what messages people respond to, what payment offers work best, and for which type of consumer. This complex data-driven system is part of our DNA and entails a lot of moving parts that allow us to truly understand what resonates with each consumer.

The driving force behind the system’s ever evolving performance is an experimentation engine that allows us to test various scenarios to see how collection processes work and how they can be improved. Since digital-first channels are highly instrumented and offer real time tracking on our website, we can learn in short cycles and continuously improve. To launch an experiment, we establish a hypothesis we want to test, monitor what’s happening in the conversion funnel at each touchpoint, see how each product or plan is being used and where consumers are dropping off. Even when an experiment fails, we learn from the data and make future iterations in a continually improving system. We partner strategically with our clients to customize experiments for their product lines and make experimentation-based optimization an ongoing process.

A few sample experiments:

Aligning Payments to Income

The number one reason payment plans fail is consumers don’t have enough money on their card or in their bank account. Our hypothesis was that if you align debt payments with paydays, consumers are more likely to have funds available, and payment plan breakage is reduced. The experiment tested three scenarios: one as a control, one defaulting to payments on  Fridays and one where consumers used a date-picker to align with their actual payday. After testing and analysis, we found that the date-picker approach worked best, lowering breakage without negatively impacting conversion.

Self-service Payment Experiences Reduce Costs and Breakage

Consumers with debt often can’t always predict when they’ll be paid or how much.  Our hypothesis was that by allowing them to self-service their payment plans and make modifications along the way (based on changes in their lives), we would reduce the need for interaction and improve the customer experience while reducing breakage. This experiment was also a success, reducing breakage rate, and also lowering call rates because before its launch, consumers had to call to change their plan.  By making the desired functionality readily available, we were able to increase payment plan success rate and save agent time.

Even Failures Are a Learning Experience

One hypothesis we tested was that customers that dropped off our radar after not choosing a plan could be enticed to sign up for a new plan if offered longer payment plans. After sending texts and emails based on their behavior, we found that new sign ups simply didn’t materialize by just offering longer payment plans with referring to the consumer’s specific life situation. The offers had a high open and click rates, but not sign ups. This indicated that we were on the right track but needed to iterate and come up with an alternative solution.

An experimentation engine allows every company to test their own hypotheses to see if their customized solutions work or not. A digital-first, highly instrumented experience allows us to run dozens of experiments concurrently, learning from each experiment so we can progressively improve our experience and results. Even when experiments fails, they unearth insights that can be used to improve performance next time as part of follow on experiments. In the world of debt collection, testing and continuous improvement means better results in the long run.

Building An Experimentation Engine

By on March 20th, 2018 in Data Science, Engineering and Data, Product and Technology
TrueAccord Blog

TrueAccord beats the competition on many levels, and does that through rigorous testing and improvement. Hear a talk from our CTO Paul Lucas and Director of Product Roger Lai on our approach to experimentation.

 

To download a transcript of this post, click here.