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Social reminders play a crucial part in customer relationships and payment behavior. But what exactly are social reminders?
It’s not just about reminding customers of outstanding invoices; it’s also about maintaining a positive relationship with them. By using personalized reminders through various channels like email and SMS, you can effectively guide your customers’ payment behavior without straining the relationship. In fact, they may even perceive it as an added service! Additionally, social reminders offer an opportunity to improve customer satisfaction by demonstrating that you value their experience and are open to discussing any payment issues they may have.
How organisations implement social reminders
Depending on their circumstances, organisations consciously choose between social or regular reminders. Our clients have been using social reminders in their daily operations for about three years now. For organisations offering services with low monthly costs, social reminders can sometimes be too expensive, so they use them less frequently.
It’s important to note that regular reminders don’t necessarily exclude the social variant. By combining the two, you can operate more flexibly. Many FIQAS clients have found that the reminder process can be made much more effective. This is possible by leveraging available data, such as reversal codes, and useful credit management tools like arrange a payment plan. Often, this starts with modifying a single step, which triggers further optimisations. In other words, start small and manageable, and achieve increasingly better results.
Our view on social reminders
Social reminders operate on the assumption that people want to pay but sometimes temporarily can’t. This approach focuses on the positive rather than the negative—and it has proven to be a winning strategy.
The focus of social reminders is on customer retention rather than punitive measures like fines. Customer retention can be achieved through flexible collection moments, a clear payment plan, and (at a later stage) debt counseling. This means helping your customers rather than punishing them. And what’s the outcome? In addition to collecting outstanding debts in a people-oriented manner, you also see higher customer satisfaction and increased job satisfaction for employees in your accounts receivable department.
Preparing organisations for Social Reminders
Not everyone has the same understanding of social reminders. Therefore, it’s essential to educate organisations about the underlying principles. Some companies appreciate the social aspect, while others are more interested in practical benefits like faster payments.
It’s often more effective to find common ground, such as the quicker collection of outstanding amounts, rather than opposing existing (negative) perceptions. These perceptions will eventually fade as the positive results become evident.
A well-organised credit management system makes a significant difference when implementing social reminders. Even though you may add several steps to your reminder process, this doesn’t necessarily mean more work. It’s a matter of smart and effective automation!
For example
- First, make phone contact. Self-learning customer profiles quickly reveal whether it’s an isolated incident or if there’s more at play.
- Providing a clear overview of the payment arrears and sending a payment link may sometimes be sufficient.
- Offering a payment plan (including automatic confirmation and installment reminders) is convenient for both the customer and the customer service representative.
- By linking a smart task system to the process, you ensure better oversight of all activities.
Why Social Reminders Are So Effective
Social reminders have led to a domino effect of benefits. A number of FIQAS clients consistently rank in the top three of customer satisfaction surveys. The dynamic and versatile nature of social reminders increases engagement within financial departments, strengthening the reminder process. We’ve seen reduced customer churn and a decline in outstanding receivables. However, keep in mind that the reasons for unpaid invoices are constantly changing. Fortunately, a good and reliable credit management solutions provider can always advise you in this area.
