Do you really rely on your customers for the payment of your invoices? Of course, you cannot pay outstanding debt for them. Nevertheless, you can impact them more than you think.
How? It is a matter of empathy and using adapted tools. These 5 steps will allow you to follow the right strategy to have efficient payment reminders.
1. Choose the right channel
The way you send out payment reminders has to match with the relationship you have with your customer. The channel that you use – e-mail, SMS or IVR – has to be the one that the customer knows as a customer. For instance, in a B2B environment, it is much more appropriate to send payment reminders per e-mail, whereas in a B2C context you will obtain more results using SMS. If you address a large range of target groups, a mix of channels may be the good option.
2. Adopt the right tone
An intrusive SMS will dissuade your customer instead of motivating him. A not so engaging message will not make him react. The right tone for your message will make efficient payment reminders.
3. Choose the right procedure
Think in terms of procedures instead of individual actions. The right flow – a sequence of well-timed actions – can do miracles. For example, you can start with an SMS when your payment deadline is almost expired, followed by an e-mail a week after the due date.
4. Combine and experiment
All options are open. When you are well prepared, meaning when you have chosen your channels and the tone that suit your customer, you will quickly have results. But nothing prevents you from doing better. Do an A/B test to see what can be improved. Divide your users into two groups. Each group will receive a different message and you will see which message works best. You can use this to test new channels, new wording of your message or a new flow. Chances are that you will discover things that you can improve to get more efficient payment reminders.
5. Measure and evaluate
What does the use of payment reminders imply for your business? You can easily find it out. Analyze the average late payments of your customers after a few months and calculate the return on investment of your efforts.
For example: you observe that every day of late payment costs you 10 euro per invoice. You have 1.000 customers per month that pay on average with 5 days delay. This costs you 5 000 euro. After the implementation of automated payment reminders, the delay drops to 3 days on average. Your win? 2.000 euro per month. It’s that easy.
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