Read all the trade magazines, blogs and press releases relating to legal collections and you’ll know there’s been a seismic shift over the last few years toward empowering the consumer to expect and receive the best possible customer outcome.
When you think about it, before Treating Customers Fairly (TCF) became enshrined in our culture, we all got a bum deal in one way or another, whether it was PPI, disproportionate bank fees or for those of us old enough to remember, being pressured into taking endowment mortgages out when we really wanted repayment. I was personally escorted from a bank when I stood my ground and refused the endowment option. Very embarrassing!
So, why should businesses embrace TCF? Well, why wouldn’t they? Customer loyalty is priceless; it costs five times as much to acquire a new customer as it does to keep an old one. It is far easier to keep an existing customer happy, you have a growing relationship to nurture, you know how they operate and what their preferences are, and you can anticipate their needs until you finally become…a preferred supplier!
As much as 70% of churn is affected by a poor customer experience, regardless of whether the price is right or not. Firms don’t want to do business if the suppliers behaviours and culture do not match their own and why should they, alarmingly 91% of unhappy customers say they will not do business again but according to the authors of Leading on the edge of Chaos reducing your churn rate by just 5% can yield a 25%-125% increase in profits over 4 years and the surest way to reduce your churn is not to hack your customers off in the first place!
Furthermore, it is a fact that the likelihood of selling to existing customers is 60% -70% but drops to 5%-20% for new prospects. If you can earn the loyalty and trust of your customer, word will spread, social media savvy firms now are more likely to check you out on the web before returning your call or responding to your sales pitch, company checkers, linked in, chat rooms, blogs, there are many places you can be seen. American Express say that “social customers tell an average of 42 people about good customer experience but tell 53 when it is bad”.
As customers ourselves, we all know what we will and will not accept, we expect complaints to be entertained promptly fairly and sincerely and we want to be talked to in way that leaves us feeling good about the conversation, valued even, even if the details are contentious or upsetting, and let’s be fair Legal Debt Collections is often both! But financial difficulties are a fact of life, the stigma no longer exists and individuals can expect to be dealt with on a case by case basis taking full account of their personal circumstances, there are no one size fits all solutions anymore, no standardised bulk processes. Our obligations as customer facing businesses means we must now look said customer in the eye and deal with them as an individual appropriately.
And if these reasons aren’t compelling enough to deliver the best possible customer outcome, then know that this is the primary demonstrable requirement of any firm seeking FCA authorisation and woe betide any firm who chooses to ride roughshod over a customer once these chaps ride into town.
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