Credit and Collections Issues for Bill-Me Offers (2,137 words)
Explains Carl Tomasello, vice president of The Credit Index, "The primary use is for suppressing offers. After a marketer rents lists and runs their merge/purge, they send them to us and we streamline them and give them back a list."
This enhancement sometimes boosts response, but the main goal is to increase pay-up rates.
While The Credit Index is a consumer reporting agency governed by provisions of the Fair Credit Reporting Act, Tomasello says its data is completely different than the data compiled by credit bureaus, since few publishers or other direct marketers report bad debt to credit bureaus.
The service can be used not only to streamline lists before mailing, but to screen credit prospects who respond through a less targeted medium, such as DRTV, the Internet or a space ad in a mass-market publication such as Parade magazine.
Explains Tomasello, "If a consumer initiates the transaction and the company decides not to fulfill the order, by law the company must send a letter explaining why and where they got the negative information about them. They may require upfront payment, a credit card or additional credit history information."
Getting Delinquents to Pay Up
Despite your best efforts, some carefully screened prospects will turn delinquent. That's when your billing series kicks in.
Explains North Shore's Harpham, "You need to design a billing series that motivates them to respond."
A billing series requires a variation on direct-mail expertise, with some of the creative rules turned upside down. Hallmarks of a successful billing series are strength and clarity, and the primary motivators—guilt and fear—are negative.
According to Harpham, a bill's creative must do three things:
1. Tell the reader why you're writing: They owe you money.
2. Tell them what to do: Write a check, make it payable to XYZ, return in the enclosed envelope.