Consumer behavior and expectations have been rapidly shifting for years. We’ve experienced a constant arc of change through the global pandemic and into the cost-of-living crisis. Customers falling behind on bills was once seen as black and white; they either have the financial means to pay, or they don’t. Now the situation is much more complex.
In Symend’s 2022 consumer research, 89% of respondents with past due bills indicated that their perception of future risk or financial uncertainty makes it more difficult to make quick, effective financial decisions. That same survey also found that 78% of respondents that are behind on bills suffer from digital fatigue. What this tells us is that your customers’ mental bandwidth is scarce, which means that your cure rates depend on a frictionless path to payment.
Why focus on journey optimization:
- Improve digital engagement
- Generate actionable customer insights
- Accelerate desired results
Improve digital engagement through the understanding of consumer behavior
The reality is most customers expect a negative experience when they fall behind. So, while service providers are investing in their digital capabilities and driving customers towards digital over live contact, there are many barriers in place that can prevent this from being effective starting with the very first touchpoint. Unfortunately, damage has been done when it comes to collecting payments from customers. Symend’s 2022 research found that 69% of respondents who were behind on bills feel overwhelmed and anxious when they receive messages from their service providers. The good news is, these behaviors can be influenced if you understand what’s driving them.
Psychology Today explains that anxiety can often result in avoidance behaviors or “avoidance coping”. While there are many ways that customers can behave when they are feeling anxious, avoidance is a common threat to collections performance due to the bad reputation of debt collection processes and the potential shame that comes with being behind on bills. Avoidance can occur for many reasons and at many points in the customer’s journey. Our 2022 consumer survey revealed the top three reasons why providers ignore messages from their service provider:
- 63%: If the same service provider is sending too many messages.
- 53%: If messages aren’t relevant or personalized and they feel generic.
- 39%: If messages are too long or complex and have no obvious point.
So how can you get your customers back on the digital path and keep them there? It all comes down to managing the investments of your customers’ time and energy, which is achieved through journey optimization.
Generate actionable insights leveraging your consumer behavior data
Getting to the root of the problem starts with meaningful, actionable data. As a science-driven company, Symend will observe trends in behavior and develop hypotheses as to what the barriers are, and then what will shift the behavior within the customer’s journey. We asked ChatGPT what the top essential types of data are that are crucial for optimizing the customer journey, and here’s what it said (italicized).
Data types:
- Behavioral Data: Understanding how customers interact with your website, app, or physical store is foundational for optimization. This includes tracking what products or services they view, add to their cart, purchase, and how often they visit. Behavioral data helps you identify patterns and preferences.
- Customer Feedback and Reviews: Feedback from customers through reviews, surveys, and feedback forms provides direct insights into their experiences and pain points. Addressing these issues can lead to significant improvements in the customer journey.
- Website Analytics: Tools like Google Analytics provide data on user behavior on your website. Information such as page views, bounce rates, and conversion rates helps you understand how customers navigate your site and where improvements are needed.
- Customer Satisfaction (CSAT) and Net Promoter Score (NPS): These metrics offer quantifiable measures of customer satisfaction and loyalty. Monitoring changes in CSAT and NPS scores can indicate the effectiveness of your optimization efforts.
- Demographic and Psychographic Data: Segmenting your customer base based on demographic factors (e.g., age, location, income) and psychographic factors (e.g., values, interests, lifestyle) allows you to tailor your messaging and offerings to different audience segments effectively.
ChatGPT noted that these lay the foundation for journey optimization. However, the behavioral data described by this AI, and the broader market, is just one sliver of the wider behavioral data that is available. This includes understanding their underlying motivators, behavioral science-based attributes and common responses from those that fit within a similar customer profile. This is done via behavioral engagement—a more personalized approach to digital customer engagement. Let’s learn more.
What is behavioral engagement?
Behavioral engagement is the key to customer journey optimization for higher cure rates with a lower cost to cure. It is a problem-solving process that is founded on the concept of solving the root cause of every problem: what are the perceptions, attitudes and barriers that are driving your consumers’ behavior?
We now know that customers fall behind on their bills for many reasons, which means a one-size-fits-all solution will never cut it today. There are four steps to achieving behavioral engagement:
- Interact to gain insight: facilitate interactions that allow you to gain insight into the barriers that are keeping your customers from engaging and making decisions.
- Understand to empathize: Understand the underlying motivations, perceptions, needs, biases, circumstances and contexts that are driving your customers’ behavior and decision-making.
- Experiment to personalize: Leverage your understanding of your customers to create experiments that determine the behavioral drivers that are most effective for each unique customer, at a specific point in time.
- Engage to convert: Capture your customers’ attention and empower them to make effective decisions by applying the insights you’ve gained to every aspect of your interactions, optimizing for conversion.
The point of this process is that it is continuously uncovering and addressing the barriers that are preventing your customers from engaging with you and completing the path to payment, so you can keep your customers balances manageable and keep them out of collections. However, the benefits don’t end there. Customers are seeking personalized experiences and delivering against that desire can serve your business in more ways than one, we dive into that next.
What can be achieved?
We noted that optimizing the digital engagement experience requires data, and it likely feels like a hill to climb, so why do it? Put simply, it can:
Improve your NPS and/or CSAT scores: Happy customers are more likely to share their experiences. In fact, 76% of customers will share a positive experience with 6 or more people. If a customer is not happy, 13% of them will share their experience with 15 or more people. These actions add up to your overall brand reputation and ultimately, your satisfaction scores.
Improve loyalty and reduce churn: The challenge when customers are unhappy is that only one in 26 will voice that dissatisfaction to their provider. What happens to the rest? They just leave. Research from PwC shows that one in three customers will leave a brand they love after just one bad experience, while 92% would completely abandon a company after two or three negative interactions.
Improve cross and upselling motions: When you understand what they need and when, you’re able to tailor your interactions and offerings to suit their needs. More than 85% of customers want proactive communication and contact from a company. With the right data, you can provide exactly what they’re looking for when they’re looking for it.
Optimizing the customer journey is the key to creating a repeatable, positive experience that customers, and you, can rely on to create win-win outcomes. With nine out of 10 businesses competing based on the customer experience alone, those who are leveraging the right data, approach and maintaining a keen eye on delivering a positive experience will be the ones that stand out and continue to win customers mind and wallet share.
