Tag: small business

Why customer feedback is so important for your small business

By on January 30th, 2020 in User Experience

Everyone knows that customers are the backbone of a business; if people don’t use your service or buy your product then you won’t have a business for very long. In order to solve this problem, companies often work to bring in as many new customers as possible, but you can’t forget to nurture relationships with consumers that you’ve worked with in the past. 

According to Adobe, 40% of eCommerce revenue comes from returning customers which make up only 8% of total visitors! That number alone should inspire you to get out and talk to your old customers and figure out what they think, but there are quite a few more reasons you should cherish customer feedback and use it to strengthen your company!

Building brand promoters

The omnipresence of social media means that consumers that are excited about your company will shout from the digital rooftops to endorse you. Unfortunately, the power of social sharing also means that the opposite is true: if a person has a particularly negative experience with your brand, they will spread the word around fairly quickly. 

Properly managing customer feedback can dramatically improve your brand’s reliability. A Net Promoter Score measures customer’s satisfaction with a business by asking: “how likely are you to recommend this (product/service) to a friend?” Customers that rate your business at a 9 or a 10 are considered promoters and are your best friend when it comes to spreading the word about your brand. 

Maintaining a high NPS score is challenging, but by focusing some efforts on gathering and listening to customer feedback, you can gradually build effective, organic branding that sets you apart from your competition!

If maintaining customer relationships is so important, you may be hesitant to try and collect on debts for fear of negative feedback. But digital debt collection solutions can support your brand and your bottom line!

Incorporating feedback and iterating

Not every review will revolutionize your business. If you take every negative review to heart, you might start to feel a bit down on yourself, but by analyzing customer feedback in aggregate, you’ll start to see patterns emerge!

These patterns won’t appear overnight, and even some patterns may not give you the direction you’re looking for (it is still your business after all). That said, if you have dozens of customers asking for a new feature or piece of content, imagine how many more customers want the same thing that aren’t asking!

By listening to customer feedback and building new tools that your customers are looking for, you can demonstrate that you listen to them and further improve retention. Plus, incorporating these changes into your customer lifecycle can pay big dividends! 

Promoters will continue to support your brand, bring in new customers, and in the long run, they will continue to spend more as your brand relationship improves. A survey by Bain & Company shows that customers actually spend more in months 31-36 of their relationship with a brand than they do in the first six months.

Creating a self-sustaining system

Feedback helps your business to grow and meet the ever-expanding needs of your market. If you don’t listen to your customers and build in a vacuum, you may soon realize that you were not solving the root of a problem. This isn’t to say that every customer suggestion or idea is the right one for your business, but if you take the time to listen to your customers you’ll build their trust and might just find the next right step. 

Tips for hiring a debt collection agency for your small business

By on January 16th, 2020 in Industry Insights

In any industry where money is exchanged, debt is an inevitability. For small businesses, even small transactions can add up quickly and late payments, delinquent accounts, and chargebacks can start to bury an otherwise thriving business. This is where a debt collection agency can help your business succeed. 

Recovering payments on otherwise lost accounts probably sounds great, but let’s do some research before you get started! Here are a few things to consider when you begin looking for a collection agency for your small business.

1. Where can they collect?

Collections agencies can provide financial services to businesses ranging from those in their local area to companies across the country, but it’s important to validate that they can operate in your state! Local collectors may not have the licensing authority to collect across state lines. 

Larger collection agencies may also work across the country and even specialize in collecting certain types of debt for a given industry, such as point of sale transactions, credit card, rent to own products, loans, etc.

2. What industries do they serve?

The needs of B2C (business-to-consumer) businesses are dramatically different than those of primarily B2B (business-to-business) business lenders or tech start-ups. Collectors that specialize in specific verticals can ramp up and start collecting effectively, faster because of their familiarity with consumers in that space. Don’t be afraid to ask a collector for their experience working with other businesses like yours!

3. Are they legally compliant?

Beyond the local and state level access, federal regulations play a large part in a collector’s operational ability. Keep your business safe and verify that the company you’re interested in working with has a comprehensive compliance management system.

A proper system will be designed to be in compliance with the Fair Debt Collection Practices Act as well as other state and federal regulations.  Also, ask what preparations the company has made for compliance with the upcoming Consumer Financial Protection Bureau’s newly proposed rules.

When you begin your research into new agencies, consider visiting their Better Business Bureau page or looking through their Google Reviews. Consumers that have had particularly negative or even legally questionable experiences with the business may help you to recognize red flags before they become an issue for you and your team.

4. What is their pricing structure?

The price on any purchase for your business can make or break the decision to invest in a new product or service, and finding a debt collection agency at the right cost is no different. Most debt collection agencies will be priced in one of three ways: flat fee, contingency, or a hybrid model. 

  • A flat fee is a one-time service payment that coincides with signing a contract and will vary depending on the volume of accounts that are being collected on.
  • A contingency payment plan is a performance-based payment model where the collector only profits from the accounts they are able to collect on. Signing a contingency contract will typically outline the percentage that they will collect per account and may change from portfolio to portfolio. 
  • A hybrid model is often a custom solution that begins with a flat fee contract and expands out to accomodate more accounts if the collector is exceeding expectations. 

5. What communication channels are they using?

The debt collection industry is undergoing a massive change, and many collections agencies are struggling to adapt. Call-based collections has been the norm for decades, and a large percentage of debt collection agencies still rely on sending letters (91%) or making phone calls (89%) as their preferred contact channels. 

Unfortunately, these channels are no longer the ideal channels for consumers. Collection agencies that embrace digital channels (email, SMS messaging, etc.) are more likely to reach consumers when and where they like to communicate, and help to humanize the collections experience.

If you’re interested in learning more about the future of communication strategies in collections, you can read here!

Working with a debt collection agency may seem like a risk, but finding the right solution for your business can mean recovering revenue that would have otherwise been entirely lost. Just make sure that your new partner is the right one for your business. What other questions do you have about what it means to work with a collection agency? Let us know!