Archive for September, 2011

Treating Debt as a Chronic Disease

by Kael Kelly on September 28, 2011 in 2011, Kael Kelly, Varolii News with 2 Comments
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Lessons from the Healthcare Industry on Communicating with High-Risk Customers

Healthcare providers typically approach high-risk patients differently than other industries, such as financial services and its approach to high-risk borrowers. In healthcare, companies like Staywell, ActiveHealth and Alere contract with payers (health insurers) as well as employers to identify patients at-risk for chronic diseases like diabetes, hypertension, cardiac problems and so forth, and work to educate and inform them about behaviors and lifestyle changes that positively impact their health. The objectives are to stabilize their health issues or even move them out of the risk group altogether. The healthcare industry has clearly recognized that there is a huge opportunity to reduce healthcare costs, improve quality of life, and make happier, healthier more productive consumers by taking the time to educate and inform high-risk patients.

On the flip side, the financial services industry faces risk in the form of lending money – be it a secured loan like auto or home or unsecured credit card debt – to someone who ultimately may not or cannot pay the money back in the manner agreed upon in the lending arrangement. How does the financial services industry deal with this risk? They put the person into a general collections process and rely on various means to resolve overdue debt.

The collections process is an important and necessary part of business. The problem is that it's treating the symptom, not the cause.

The cause is that a consumer in collections has made a series of decisions that led them to a place where they are unable to meet their financial obligations. Sometimes unavoidable circumstances occur, like a workplace injury or unexpected health problem that derails an otherwise prudent borrower. Regardless of the reason, people sometimes overextend themselves based on things like false optimism about how much they'll be making, inability to plan, or simply not budgeting well. But what if the financial services industry took the same approach as healthcare, identifying financially at-risk consumers and embarking on a financial management education program, rather than punishing them with high interest rates and painful lending terms? Many banks and lending institutions are already doing this and can see positive results.

Imagine if we could re-wind the clock to 2005 and we had a robust financial management program in the U.S. targeting high financial risk consumers. A program whereby high-risk consumers were programmatically educated around financial risk and counseled periodically by financial management experts, much like a wellness plan engages at-risk members using an engagement specialist or skilled nurse? What if 20% of the people who ultimately have or will default on their mortgages instead decided that no, with a $14,000 annual salary, I can’t buy the $720,000 home (which really happened in central California)? What if there were 20% fewer defaults? Would the economy today be 20% "better?" We don't know. But to me it's an intriguing idea worth considering.

Finally! Congress considers updating the TCPA

by Brian Moore on September 26, 2011 in 2011, Brian Moore, Compliance, Varolii News with No comments

Are you worried that your company may be at legal risk when you communicate with customers on their mobile phones, even when they should welcome the call or message because it protects them from fraud, missed flights or late payments?

Well, perhaps you should be.

The Telephone Consumer Protection Act (TCPA) requires you to have the prior consent of your customer to autodial, text or deliver recorded messages to their mobile phone. While the FCC (who enforces the TCPA) has declared if a customer provides their mobile number to you when they apply for credit, they are giving their consent for such communications, that's a pretty small needle to thread. So despite the proven benefits of timely and efficient customer contact on the device where they are most likely to be reached, some companies are limiting their communication attempts to the dwindling number of customers with land line phones.

But relief could be on the way. Thanks to the lobbying efforts of broad coalition of industry associations in financial services, air travel, higher education and utilities, a bi-partisan team of congressional representatives have introduced the "Mobile Informational Call Act of 2011". They propose to modernize the TCPA by exempting informational calls to wireless phones from auto-dialer restrictions, clarifying the “prior express consent” requirement, while continuing the prohibition against the use of assistive technologies to call wireless numbers for telemarketing purposes.

However, just because the bill has been introduced, it’s a long way from law. This is where you come in.

Please email your representatives and senators to urge their support of the bill. Tell them efficient communications improves service to your customers while lowering your company's costs, allowing you to grow the business and boost our economy.

That's what I am doing as soon as I post this blog.

Care Continuum Alliance Forum Recap: The Need for Member Follow-through

by David McCann on September 23, 2011 in 2011, David McCann, Industry News with No comments

Dave McCannCCA Care Continuum Alliance Forum Recap: The Need for Member Follow throughEarlier this month, I had the opportunity to go to the annual Care Continuum Alliance Forum, a conference for dozens of disease management companies and health plans. It is a great opportunity to share the latest trends and perspectives on U.S. member/patient engagement. I had the chance to join several interesting conversations on the topic. Here are some thought-provoking factoids that came up during our dialogues:

  • Messaging to consumers in the U.S. is rising at a prolific rate – at least an 11% growth, if not more, when you look across email, texting, and voice.
  • Disease management companies are really wrestling with four problems:
    1. How to segment their member populations so that they can initiate the right engagement campaign to the right group. To get the segmentation right, they are looking at lots of analytics tools to "bucket" groups of patients into right-sized clusters, for whom they apply the right techniques.
    2. Once they get members segmented, they all admit they aren't getting the member engagement/adherence they want. So, they can segment, and get lots of information, but they can't accomplish compliance/adherence goals. This is obviously a big frustration.
    3. Phone access: most admitted they can't get members on the phone with nurses or call center staffs, at the right time or skill level they want. So they know they are trying to accomplish a Sysiphean task. ( remember, rock up the hill Greek guy ? )
    4. Most admitted they need to do more outbound, proactive interception of the patient/member.

In sampling about 40 people in one meeting, a high percentage admitted they hadn't yet achieved the right balance between personal dialogue with members and automated intervention. And economically, they all admitted that their budgets for staff are NOT going up at a prolific rate. Yet they are under pressure to do "better" next year. So there is a real squeeze going on. They have to do more, but with flat budgets at best.

It is clear that our healthcare economy spend can't go up. In one CCA executive meeting, CEOs and senior vice presidents of major health management companies, insurers and industry consultants acknowledged that cost has to come out of the service chain somewhere. At 16 percent of our U.S. GDP, we can't have costs continue to rise. There just isn't the money.

All companies are on the hunt for better efficiency. Efficiency came to the car industry. To the financial industry. Now efficiency is "in" at healthcare companies. And patient/member interaction is a huge potential cost zone. Talking to 100 million disease management members a year, just in the U.S., could cost up to $25 billion. Companies just can't absorb that cost. They need to put that money into their member communications infrastructure, considering the regulatory mandates they are all urgently striving toward.

So more, personalized, targeted, patient reminder technology has to happen. Our economy has digital consumers; who are now "digital" patients. For instance, a recent study out of the University Health Network in Toronto shows patients are far more likely to use their blood pressure monitors if they receive automatic phone calls or texts reminding them to perform the checks, or alerting them to negative trends in their results.

My Prediction: patient/member digital engagement will continue to rise, and accepted methods for reminding, informing and "nudging" patients into action, will only get more frequent, more accepted, and more sophisticated. What do you think?

Personalization Pays Off - Part 2

by Brian Moore on September 8, 2011 in 2011, Brian Moore, Call Centers, Consumer Svcs, Varolii News, Wireless/Telcom with No comments

When communicating with customers, does personalization  matter? Can you expect a return for the effort and expense of recognizing your customers as individuals?

In Personalization Pays Off - Part 1, we discussed the tension between your customer's desire for personal treatment and your company's need to keep costs low by delivering products and services that are essentially the same for large segments of your customer base.

Striking a proper balance between these two competing forces is critical to ensuring customer satisfaction and company profitability.

Whole books have been devoted to this topic; I'm not trying to boil that particular ocean here.

That said, there are a few practical adjustments to "business as usual" you can make that will pay for themselves by improving customer loyalty, lowering operational costs and driving better business performance:

  • Track and act on customer's explicit and implicit preferences. An example of an explicit preference is a customer request that communications be in a language other than English; an implicit preference might be inferred from the fact that they only answer your calls between 10AM and 2PM.
  • Provide time saving conveniences to reward customers who choose to self-serve. Offer to securely store their bank or credit card account information when they make a phone or online payment so they don't have to enter it again next time. Also, configure self-service menus on web pages or IVRs to provide easier access to previously used functions.
  • Look for any and every opportunity to treat customers as individuals. Start by using their name, not their account number, when you greet them. Reference the name of the unique product or service they are using. Be specific about account status, including reference to any recent conversations, payments and purchases - all the better to prove you are talking to them about their unique situation.

The importance of this last point is hard to overstate, particularly when you are automating communications via interactive voice messaging, SMS text or email. Personalization helps cut through the noise in these channels, allowing your message to stand-out as timely, relevant and respectful.

Consider the following experiment we ran with a wireless carrier (I'll call them XYZ Mobile) who uses interactive voice messages to encourage their prepaid subscribers to "top up" their accounts by making an immediate payment. In this experiment, the target customers were randomly assigned to either group A or group B. The only difference between the messages delivered to the two groups was in the greeting - Group A were asked to confirm they were owner of the assigned phone number, while Group B were greeted by name:

• Version A

“Hi. This is XYZ Mobile calling for the owner of <206-555-1212>. Press any key to continue.

• Version B

“This is XYZ Mobile with an important reminder.  If this is <Brian Moore>, press 1.  Otherwise, press 2."

Which do you think got better results?

If you said the one that asked for the customer by name instead of by number, you're right! Over three quarters more customers indicated they were the right party and almost two-times as many topped up their accounts in direct response to the interactive voice message in Version B than in Version A:

Greeting Test2 Personalization Pays Off Part 2

Needless to say, our client concluded the experiment by treating 100% of their accounts with Version B, no doubt with a nod to Bob Seger and the Silver Bullet Band.

Communications are Converging

by Mary Cook on September 7, 2011 in 2011, Call Centers, Consumer Svcs, Mary Cook with No comments
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Where is customer communication headed? [1]

It is clearly becoming individualized. This isn't new.

We've talked about relevancy in one‐to‐one communication for years, but talking about it and making it real are two very different things.  Now it is not just becoming real; it is becoming an expectation. Companies that don’t segment their customers (or can't do so because they are siloed either by organizational structure, the way they have aligned their different communications channels, or even by just their beliefs or mindsets) consequently will have a fragmented view of the customer and will be unable to entertain a coherent conversation.

It is happening in Real Time.

The reality is that technology has fostered this need for instant gratification. But many of us have a batch mind set, and a batch process that we are still relying on, and when the expectation is that you are going to communicate with me in an individualized way, and you are going to do it right now, real time can become very difficult unless you know how to do real time mass personalization.

Interactivity and Multiple Channels

We now have the ability to engage in any dialogue, and we are engaging in that dialogue across multiple channels. This is also a challenge because of silos, and the ways we tend to silo our messaging channels:  e‐mail here, social there, SMS and still another place for everything else…

This is also, however, because customers' behaviors and expectations have changed. They expect to be known.  They expect to be treated as individuals, not an e‐mail address, not a phone number, and they expect that the interaction that the enterprise is going to have with them is going to be across their channel of choice.  And you know what? They are not staying in the channel you might have initiated that conversation in. They are moving to whatever channel suits them at that particular point in time, and those expectations and behaviors are changing constantly.

And what is next – or right here? Convergence.

Communications are coming together.  It's about the fusion of marketing and services, and it is about all your customer touch points.  The reality is that over time, the channel chosen is going to become very incidental to the message that you are trying to convey, as the consumer is going to be fluidly moving in and out of those channels. So we should all start looking to become more adept at how we manage that flow of communications as opposed to individual channels.

[1] In an effort to understand this, I first had to define communication. So, as a recent MBA student who was forbidden to accept Wikipedia as a reference source, I of course leapt this social free encyclopedia.  It is defined as the “activity of conveying meaningful information…communication requires a sender, a message, and an intended recipient, although the receiver need not be present or aware of the sender's intent to communicate at the time of communication; thus communication can occur across vast distances in time and space." (This, by the way, made me laugh and think about the Star Trek time and space continuum.)