12 Aug When Converting Customers to Paperless, Small Incentives Earn Big Results
By Jim Techtmann
Driving customers from paper and direct-mail billing can be challenging, but the many benefits in the conversion are certainly worth the heavy lift. A small incentive can go a long way in helping a customer over the finish line.
The United States Postal Service RARC Report claims a mix of paper and digital systems costs 80 cents per bill for businesses. A fully electronic system costs 32 cents per bill. The costly combination of paper statements and digital payments is used by 75 percent of customers. If you are billing monthly (as many utilities are), the expenditures become daunting.
Getting customers to go digital isn’t easy, but there are big benefits beyond saving money on postage and fulfillment. Fast processing and timely alerts decrease the likelihood of late payments, fees, and credit-score hits. Furthermore, customers are willing to switch: Fiserv’s billing survey discovered that more than half of participants were open to converting paper bills to e-bills given the proper motivation.
So why are many customers still receiving paper bills? For some companies, the approach has been flawed. They use constant reminders to ask consumers to switch to e-billing or apply surcharges if they receive paper bills. This ‘stick’ approach can feel punishing to customers. A much more favorable tactic is to provide a ‘carrot,’ a reward for going digital.
In this case, the “carrot” can be an engaging rewards program that drives desired behaviors at a very low cost. Many utility companies are looking for this kind of solution, as it’s hard to find high-value, low-cost incentives that can be delivered electronically. Programs with multiple rewards are complex, costly, and hard to execute. So, get ready for a helping hand.
The Ultimate Results
A successful incentive delivers on all five of these goals, improving revenue, retention, relationships, and ROI.
1. DRIVE BEHAVIOR: Incentivize customers to switch. Reward them to stay.
2. GENERATE SAVINGS: Save money and time for customers.
3. IMPROVE SATISFACTION: It’s the best way to retain your customers.
4. STRENGTHEN COMMUNICATION: It’ll boost customer engagement.
5. IMPACT THE BOTTOM LINE: Customer savings mean considerable benefits for all
Choosing the Right Rewards
When developing rewards and incentive programs, here are the core considerations:
Universal appeal: Everybody loves to save money, Customers benefit when incentives are relevant to their lifestyle. Dining out has universal appeal: According to Gallup, 60 percent of Americans eat out once a week, and that number increases to 70 percent among millennials.
Brand consistency: Do the rewards reflect your corporate values? Stick with a consistent message—in this case, saving money and time. If your brand attracts customers who focus on deals and savings in the local community, you can become a hometown hero.
Cost effective: Does it improve the bottom line, with strong ROI? Look for rewards with low cost per customer and high perceived value, then compare them to the cost to send monthly mail communications. You’ll likely see a six-to-one ROI! Develop programs with predictable liability to ensure the budget won’t change dramatically during the program.
Long shelf life: Will the program keep members interested over the long haul, and can they use it throughout the year? Returning to the dining example, variety helps. Including several restaurant options in your rewards program ensures the reward remains engaging.
Ease of implementation: What internal resources are necessary for support, and how long will implementation take? Create programs that are predictable and simple for your organization to execute and easy for the customers you want to reach.
Find the right partner: Is your rewards partner experienced? Do they have examples of work that show results? Reward programs are both a science and an art. Find a partner with the experience and data to help develop the perfect reward program for you.
Remember, going paperless doesn’t just save companies and customers money on each transaction. A successful campaign has much deeper effects on brand awareness and perception. The results of a strong rewards program will be new opportunities for customer engagement, increased satisfaction, and a positive experience with your brand.
Jim Techtmann is the VP of National Sales – Corporate Marketing Solutions at Entertainment.