Promoting Direct Debits
Paying by Direct Debit offers benefits for both the payer and the collecting organisation, so here are a few simple ideas to help promote Direct Debit to your payers.
- Explain the benefits to payers
- Offer flexibility of payment date.
Your payers will be much more likely to pay you by Direct Debit if you give them enough options on dates or times that suit them. Everybody has a different preference and most people prefer to have their Direct Debits go out just after they themselves have been paid.
Ensure you and your team are fully trained and up to date. Training will help you to reduce the number of unpaid items, improve the customer experience and reduce indemnity claims. If you are getting more people signed up then why not keep more of them also.
- Make it easy for them
Are you taking full advantage of all the paperless channels to get more direct debit customers. Paperless can vastly improve the number of sign ups especially with a multi channel approach and it needn’t be difficult to set up. We can help you to implement new paperless Direct Debit Channels and stay ahead of the competition.
In most cases collecting by Direct Debit will be significantly cheaper for you to administer and will offer you much improved cash-flow. Why not pass some of this saving on to your customers.
- Straightforward discount: The favourite of the telecom and energy companies who are not only keen to get new customers on board in the most cost effective way but also are at constant risk from people “Switching” service suppliers. They favour providing a discount that is ongoing as new customers are more expensive than creating loyalty amongst their existing ones. Advantages – Easy to understand, good deal for customers, incentivises loyalty.
- Discount initial period: If signing up new customers is the main aim and you are likely to be able to create loyalty in other ways then why keep giving the discount away every month or year. Publications often offer the first few copies for free if you sign up to a 12 month Direct Debit. Your local gym will often give you the initial month for free in the same way. Advantages – Easy to understand, the word “Free” is a powerful marketing tool. Longer term margins are not affected.
- A free gift: Cuddly toy, Cuddly toy. Is there something that you can offer that doesn’t cost you the earth but has real appeal or value to your customer base? It would be a bit odd for a charity to offer a discount however those of us that have a soft spot an animal charity may find that cuddly lion cub too much to resist. Advantages – It maybe more ethical or attractive than a financial incentive. Subtly branded goods can also be a useful as a constant reminder.
- Prize Draw: The hook for Council Tax payers in Greater London recently was the potential of £25000 in prize money. If you have a big enough customer base or a captive audience this might be a low cost initiative with a decent size prize. Again it doesn’t have to be a one off, you could have a regular draw for all of your Direct Debit payers and shout about the winners in your newsletters and on your website. Advantages – Only one prize to give away, easy to administer, can generate additional publicity.
- Additional time to pay: Business to Business environments are often looking to reduce debtor days and the good news is that DD customers pay on time and don’t need chasing. You could reward people for choosing to pay by Direct Debit by offering them improved payment terms. You still get the benefit of being in control.
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