There are many ways an agency can operate strategically. Each agency must cater their strategy based on portfolio type, staffing, inventory, client demand and regulation. Today I’m going to discuss a few of the strategies we’ve implemented throughout the years.
When I first entered the collection industry we didn’t have dialer technology to help us work our inventory. Each collector was assigned a number of accounts for which they were accountable while at their desk. During what we called “prime time,” collectors would spend the majority of their time manually dialing in an effort to make contact with the consumer. During non-prime time hours we would use various skip tools and contacts to obtain updated location information for accounts that didn’t have accurate information. Now we have an automated process that sends a batch of skip accounts to our skip trace vendor freeing up more time for the collectors to make phone calls.
In the early 2000s we began using auto dialers to reach consumers and actively work our inventory. In the beginning we utilized the dialer only when inventory was behind and service level agreements had to be met. As our business grew we became more dependent on the dialer and used it the majority of the day. We found many benefits to using the dialer including increased penetration rates, campaign and agent reporting, local caller ID packages and time zone/area code mismatching. As we all know, attorneys have made a living suing companies for alleged TCPA violations due to the use of an auto dialer. Agencies had to change how they did business or deal with frivolous lawsuits. We not only changed the technology we used to dial phone numbers, we also changed our collection strategy.
Scoring Strategy
We currently score all of our business allowing us to segment our inventory in tiers focusing on accounts with the highest probability to pay as opposed to those with less lower scores. The scores also allow us to strategically target accounts using a letter strategy. We send the initial letter upon placement on all accounts received. After 45 days we then target the higher scored accounts with a payment arrangement letter. The final letter of our series is a settlement offer letter that’s sent 45 days prior to recall.
Trigger Strategy
Triggers are another way to focus on accounts with a higher probability to pay. There are hundreds of triggers including contact, credit available, positive improvements, new trade lines and inquiries. Each agency will have to determine which triggers are most effective for their line of business.
For many years we used a standard strategy and segmented our inventory using the data our clients provided. There’s nothing wrong with using a standard strategy. Listed below are a few of the ways we segmented our inventory:
• Last payment date
• Charge-off date
• Balance
• Co-signers
• Number of years account was open
• Total number of payments made
• Received date
• Settlement authority
We would also segment the business based on data we obtained through our work efforts:
• Previous contact campaign for closers
• Postdate campaign to upgrade arrangement
• Calling at different times throughout the day
• Manual place of employment calls during typical business hours
• Creating a debt settlement company team to handle those accounts
• Not-Sufficient-Funds (NSF) roll over to the house collector after so many days
Our industry continues to evolve and it’s important that agencies change with the times. While most strategies are similar and don’t require reinventing the wheel, we as leaders must continue to think outside of the box and come up with new ways to contact consumers.
Sam Eidson is the Director of Operations at Delta Outsource Group. He is also a member of the board of directors for the Missouri Collectors Association.