Customer Relationship Management has perhaps been the most significant area of investment for businesses across the world over the past 10 years. As the channels of communication broaden and the effects of digitisation widen, businesses are presented with more media than ever before that they must invest in, to acquire new customers and win new business. And while companies have put a lot of focus into automating sales, marketing and fulfilment to win new business and sell more to existing clients, there has been a clear lack of investment or thought process into how we manage that customer once they begin interacting with the back office.
Who has considered the contact strategy for customers once they begin transacting and purchasing from the business?
We all know the familiar adage 'It costs five times more to acquire a new customer than to retain an existing one' yet the world over, companies are guilty of assuming that once the customer is secured, the communication efforts should only be reserved for marketing purposes – cross selling / upselling etc.
FRM needs to bring to the back office, what CRM has brought to the front office
High DSOs, invoice error rates, high processing costs are all symptomatic in companies that have maintained the status quo when it comes to antiquated back office processes. It is time to reinvent how we deliver perhaps the most important content, the invoice, to the customer. When we engage with clients to review transactional communications, it becomes quickly apparent that the invoice / statement communications are somewhat taken for granted. Nowadays the consumer demands much more than the simplicity of a printed invoice sent in the post.
An invoice is an invoice, right?
Time and time again we see customers blocking out the day (or days) to print, sort and post the invoice run, rendering key staff of limits. Sometimes, we manually pull out invoices that should not be sent. Occasionally, we send the wrong invoice to the wrong customer. Sometimes, we send invoices via PDF yet the customer claims to have not received, perhaps due to firewall issues. Sound familiar?
REDUCE COLLECTION EFFORT UP TO 75%
There is no reason why the back office needs to manage AR communications in the same way as ten years ago. Systems have evolved; simple software can enhance how we deliver, and more importantly, engage with our customers when it comes to the al important time to make payment.
20% OF INVOICES ARE SENT TO THE WRONG PERSON
30% OF INVOICES HAVE INCORRECT INFORMATION
Businesses that continue to rely on manual processes are exhausting AR resources and are often unable to handle multichannel delivery, offering zero flexibility to respond to the customer.
Studies have shown that customers will respond quicker and pay on time with fewer queries, if the bill is clear, easy to understand and most importantly delivered in the preferred manner which the customer wishes to receive. Providing the customer with online channels to pay or query bills also contributes to reducing the resources required to collect cash and lower DSO.
REDUCE PAPER BILLING UP TO 95%
Consider the platforms that marketers have been using to improve engagement with prospective new clients. How could you leverage these platforms to improve back office engagement with customers? Self-service portals, e-billing, self-help dashboards, channel preference to deliver physical and digital invoices and statements. This is not future thinking technology. This is technology that your business has been investing in from a marketing and sales perspective for a long time.
eINVOICING COULD SAVE UP TO $21.69 PER INVOICE
FRM will align how your business engages with clients at the front end
to how you successfully interact and transact with customers at the back end
Make it easy for your customer to pay:
Send the invoice / statement via the channel the customer wishes to receive: Physical Mail/Email/SMS/Web Portal
- Give the customer access to self-help tools
- Ensure your invoice is clear, easy to understand
- Build automated triggers into the payment cycle, to prompt speedier payment Widen the communication touchpoints – your AR staff should not be the only
point of contact for customer queries
Don't produce invoice / statements that are look inferior to the marketing and sales content sent to the customer or that are sent via inferior channels. The customer needs to see that the invoice / statement holds as much brand integrity as the marketing content, the invoice is as important, if not more so.
IMPROVE PROMISE TO PAY UP TO 80%
REDUCE BAD DEBTS UP TO 90%
The accounts receivable interaction is typically the final step in the transaction lifecycle, yet ensuring a positive customer experience is often limited or non-existent.
1 BILLION INVOICES ARE EXCHANGED IN
AUSTRALIA EACH YEAR
We advise clients to start by reviewing all current billing communication, statements, invoices, overdue notices etc. Could they look better, clearer to read and understand? Does the customer pay on invoice or statement? Is there an opportunity to merge documents together to reduce time, labour and costs? Does the AR function need to embrace digital technology? Would the customer prefer a digital invoice? How much time is spent dealing with the same queries from several customers, when the invoices have been sent? What impact is this having on your staff resources that should be spent chasing debt?
There is a world of options available to quality control the accounts receivable process – from the method of invoice delivery to giving the customer several options to interact with you and ultimately pay on time. Often, the solutions are simple enough to requi
re little or no IT involvement and the payback is almost immediate. I often ask customers to reflect on the activities of their marketing teams. Have they stayed true to just physical direct mail to win customers? No. They have evolved their activity, embraced CRM, embraced digital, to stay ahead of the game and win new business.
Credit managers need to realise that the same ethos
needs to be applied on the back end, to improve the performance of the AR function.
By Symon Cook, National Sales Manager – Digital Solutions for Neopost AustraliaNeopost Australia is one of the country's leading AR solutions providers, specialising in workflow automation, AR efficiency and document in and output management.
October 2017 - BSBCUS501 - Manage quality customer service - FNS51520 Diploma of credit management and BSBCUE203 - Conduct customer engagement - NS40120 Certificate IV in credit management
*Data Source, Billentis