Engaging with customers in debt journey – by David Murphy

2022 was another exciting year for our ReachOut service as we partnered with many more leading UK brands – and secured further awards for our unique approach to engaging with those in debt, identifying vulnerable circumstances and getting customers to the holistic help they need.

Having won awards for our partnerships with Anglian Water and Nationwide Building Society (amazing organisations that work hard to support customers) people are keen to hear what we’ve learnt through our ReachOut approach about customers, their debt journey, and the best ways to engage / support them to resolve debts and improve outcomes.

Our insights have been gleaned through our own conversations with people that hadn’t engaged with the traditional collections journey – based on their lived experience – which we hope you will find helpful when considering how to enhance your own debt communications.

The feelings of customers

Firstly, we looked at words customers use to describe how they feel when bills land, and the feelings that can generate.

We saw key themes and the regular use of words such as “stressed”, “panicked” and “fearful”. The feelings of fear can be very overwhelming for some, and for others it’s the struggle to understand the content of collections letters that can lead to feelings of anxiousness.

For those struggling financially, especially with deficit budgets, we can clearly see there’s a real fear of being asked for money they simply don’t have. Regularly customers talk of the impact this has on their wellbeing; whilst some get frustrated as they feel there’s more important things, such as food and rent, to worry about.

This can, and does, lead to customers avoiding creditors with letters left unopened and examples of a lack of trust with their suppliers (often unjustified or as a consequence of how they’ve been treated by other organisations). This is a real shame as often letters detail a raft of amazing support on offer, although where this appears on the reverse of a letter customers tell us it can appear like an afterthought.

Around 6% of people our ReachOut Pathfinders speak with are in extreme crisis with a multitude of complex challenges, including around their ability to manage bills and other money or mental health matters.

As 100% of customers referred to ReachOut have problem debt and aren’t engaging with their creditor, many talk about loss of employment and long-term sickness. We also hear of bereavement, grief, a relationship breakdown, or addiction – and increasingly around hopelessness and thoughts of suicide.

Customers talk of how things escalate and get out of control very quickly – meaning early engagement is key to good outcomes.

Behind each debt is a personal story, and it’s only through understanding the real challenges – and connecting customers to support – that you genuinely get sustainable debt resolutions (as well as more loyal customers and brand advocates!). Key to this is creating a safe space for customers to open-up, asking the right questions, giving people time to talk and really listening.

The application of our learnings

ReachOut has grown extensively because of our team, the way we work, and the outcomes we achieve. Another marker of success is that many businesses now approach us to talk through our strategy in their quest to explore broader conversations with customers.

Our message has been the same to those looking to reach out to the vulnerable:  be prepared to make your customers feel visible, valued and validated, and then they’ll be more likely to open up to advisors who must be trained and ready to lead these difficult conversations.

There’s absolutely no silver bullet to solving any issue around debt and vulnerability, but there are practical steps every organisation can take to make it more likely for your customers in debt to respond and engage.

Those steps include the following four areas:

• Remove consequences and promote support:  Support can sometimes be relegated to the back of a debt letter. When the customer sees reference to the actual debt this may trigger anxiety and they may not read on. Consider including a letter early in your collections journey that focuses solely on the support available and doesn’t mention the debt.

• Consider tone, language and font: Softer language and an empathetic tone promote engagement – whereas red, bold and capitalised text has the opposite effect. Lots of words can overwhelm and jargon can be a barrier to comprehension, so consider if there’s a simpler and shorter way to get across your key message using plain language.

• Use different styles and channels: Have a diverse range of contact channels, techniques and partners. The more variety you have in your approach, the more likely your customer will hear your message.

• Use trusted partners: Where you can’t engage with your own customer then use a partner who can. Success here requires partners who are experienced and have a track-record of guiding people back to a wide range of much needed support and which they may not be aware of. Expertise in this area, really is worth its weight in gold.

Engagement is king

To sum up, even if a customer remains unable to pay their bill there’s a lot of benefit in having the conversation, understanding why and identifying vulnerable circumstances.

It allows you to offer support, strengthens the customer relationship and their trust in you, and creates opportunities to signpost to further support. This all helps reduce anxiety and helps customers towards getting back in control – which is a win-win for everyone in the long run.