Get the Letter Opened
Think Like a Marketer
One goal of every collection agency is to get their collection letters opened, read and understood. How do you ensure this? You have to think like a marketer. Design letter campaigns that effectively get you in contact with your debtors. Debtors are sophisticated; they don’t answer the phone and they don’t open letters that look like collection letters. A series of basic envelope packages with generic look, offer and verbiage won’t help you outperform your competitors. Below are a few strategies that will help you get your letter opened.
Vary Letter Packages. Alter the outward appearance of your letter. Some package options that are generating increased response rates are closed face envelopes and self-mailer packages. A closed face envelope – one with no windows – mimics the appearance of hand generated correspondence. It’s also possible to address the envelope with a handwriting script and blue ink. Marketers often utilize closed face envelopes because of their increased open rates. Advances in letter production have made closed face packages much more cost efficient to produce. Another option that has proven to be successful is the self-mailer. Self-mailers are packages created from one sheet of paper that is folded to create a secure document.
Segment Debtors. Every debtor is different and in turn, responds differently. Therefore, the same package and offer should not be sent to every debtor. Moreover, not every debtor in your database is even worth talking to. It pays to develop statistically significant clusters or cells of debtors who behave and respond similarly. Once these are identified, develop unique collection strategies for each debtor segment, using verbiage and offers relevant to them. Tailoring collection strategies to debtor segments will ensure an increased ROI.
Test Your Strategies. Any new package or verbiage/offer should be tested against a standard control mailing. The largest gains are made through testing of models over time. Fortunately, multiple tests can be executed simultaneously. Experience with multi-variant testing and reporting is essential to ensure significant results. Your letter vendor can help you in designing and analyzing these tests.
Collection letters need to generate a response. With postage prices rising, blindly throwing letters (and postage money) at the debtor is not the solution. Though few agencies have the time and resources to totally re-invent their communication strategies, by taking a few strategic steps and relying on the expertise of the partner letter vendors, agencies can see a reduction in their postage costs and an increase in response and ROI.
