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¡Bienvenidos! Best Practices for Using Welcome Calls in Your Hispanic Customer Service Strategy

Tony Malaghan
June 30, 2009

Many companies have adopted strategies to welcome their newly acquired customers. These contacts most often take place in the form of letters or packets mailed to the customer via the postal service, an e-mail, a pre-recorded outbound broadcast message and/or a live outbound telephone call from a customer service representative. The type of industry, purpose of the initial contact and cost to deliver the message drives the strategy and the tools utilized in a welcome contact. We have seen that many companies underestimate the benefit of welcome calls, especially to their U.S. Hispanic customers.

Census 2000 showed that more than one person in eight who lives in the U.S. is of Hispanic origin, and the U.S. Hispanic population continues to grow much more rapidly that the non-Hispanic population. By 2012, nearly one person out of every six living in the U.S. will be of Hispanic origin. By 2025 that figure will have increased to one out of every four! According to the Selig Center for Economic Growth, in sheer dollar power Hispanics' economic clout will rise from $862 billion in 2007 to slightly over $1.2 trillion in 2012. Based on these numbers, this market is certainly one worth taking, pursuing and developing specific strategies to target and retain these customers.

In nearly every industry, a welcome contact that thanks the customer for their business and congratulates him on selecting your company as his provider helps form the foundation for a successful long-term relationship. In today's competitive landscape consumers have many choices when selecting providers for their banking, lending, insurance, landline/wireless telephone service, cable TV, home security, etc. I think it is fair to say that in today's highly homogenous marketplace, consumer decisions are initially driven by price and businesses have to look elsewhere to find that key differentiator between their product/service offering and that of their competitors.

One area where businesses can develop a real competitive advantage is providing excellent customer service. In the general market, low-cost postal mail, e-mail, and automated message strategies are effective tools to welcome customers and familiarize them with your products, services and payment methods. Except for the very young customer, who may be a first-time user of your service, general market consumers are fairly experienced in commonly used business practices. However, the U.S. Hispanic market is comprised of individuals who vary greatly in their level of acculturation to the social/cultural life, as well as business practices in the U.S. Those unacculturated and partially acculturated Hispanic consumers may be unfamiliar with U.S. business practices, processes, and tools that can be accessed to answer questions or resolve disputes and will benefit greatly from a live outbound welcome call by an experienced bilingual customer service representative.

Immigration has been a major contributor to the growth in the Latino population which means adult consumers who are newly arrived to the U.S. must research, shop, and purchase the basics and luxuries to function in their new environment. Most of these consumers have used banking, insurance, telephone, utilities, and other services in their native countries, and will seek similar services in the U.S. However, the way companies in these industries operate in other countries can be vastly different than in the U.S. because they function under different laws and regulations and use other business practices. For example in some Latin American countries industries which are very competitive in the U.S., such as telecom, operate under a monopoly which means that immigrants to the U.S. must learn how to navigate, understand and make decisions in a complicated and competitive environment. Many of these issues and concerns are tackled in the sales process where sales people take the time to describe, explain, and answer questions about your product or service. Additionally, many companies provide Spanish-speaking sales representatives, and Spanish-language websites, marketing collateral and documentation as tools to educate the customer and close the sale.

However, let's be realistic: How many salespeople describe how a customer will be billed, the consequences of late or missed payments or other servicing issues? Sales people are motivated, remunerated, and driven to close sales and move on to the next prospect. Therefore this information is generally ignored. Since Hispanic customers are less experienced in billing and payment processes in the U.S., it behooves companies to deploy a high-contact strategy to ensure your customer understands your products, services and the importance of making timely payments.

The objectives of a live outbound welcome call to your new customers are best delivered by a bilingual customer service representative and may include one or more of the following:

Verify and correct account information
Answer any questions the customer may have about the product/service
Educate your customer on how to maximize his relationship with your company by further describing your products and services
Emphasize the importance of on-time payments to reduce delinquencies, service interruptions, etc.
Increase customer loyalty to improve retention and reduce churn
Identify relevant cross-selling opportunities for the future

The ideal timing for a welcome call will depend on the type of service your company provides, but optimally will take place within a few days of service activation. Do not underestimate the importance of the welcome call and the long-term benefits you will reap. This is the first contact you have with the customer following the sales process.

The tone of a welcome call is friendly, informational and inviting. In best practices, the content of the welcome call includes the following steps:

Welcome the customer and ask if they have any questions or concerns about the service.
Verify the customer's contact information and ask for additional or missing information. These include verifying the correct spelling of the name(s) on the account, billing and/or property address(es), and home, work, and mobile telephone number(s). Ask for and record alternate telephone number(s) where the customer could be reached (beeper, pager, etc.), employer name, employment position and location, and spouse and/or co-signer contact information. This information is invaluable if the customer's account falls into collections.
Explain your billing process:
How your company will bill the customer and what the bill looks like: payment or coupon book, monthly billing statement, invoice, etc.
When he should be receiving his billing statement (or other payment notifications).
The payment due date: explain the terms of your payment agreement or contract.
Advise the customer of the due date, grace period (if any), how minimum payments are calculated and the penalties and/or consequences of late or missed payments. These could include late charges, credit line reductions, account closure, service suspension, etc.
The tools you provide to your customers to verify their charges and account such as a call center, Internet website, ATM, branch, etc.
Close the call by thanking the customer for his business and selling the benefits of your product or service. Reassure the customer that if they have any problems with their product/service, then you are only a call away.

Another opportunity for a customer contact is after the customer receives his first billing statement and before the first payment is due. This is particularly relevant to the U.S. Hispanic market as we have found that many companies in the U.S. who are servicing Hispanics do not provide bilingual or Spanish-language billing statements. If your customer's preference is to speak Spanish and you are providing billing information in English, this further emphasizes the importance of making an in-language call to explain your billing and payment process.

The tone of a statement education call is friendly and informational. In best practices, the content of the statement education call includes the following steps:

Ask the customer if they have received their bill and ask if they have any questions or concerns about the content or the amount owed.
Highlight the payment due date and explain the terms of your payment agreement or contract. Advise the customer of the due date, grace period (if any), how minimum payments are calculated and the penalties and/or consequences of late or missed payments. These could include late charges, credit line reductions, account closure, service suspension, etc.
Educate the customer on two important points: the importance of establishing good payment habits with your company and how to build their credit history.
Describe all the ways your company makes it easy to make on-time payments. Your payment methods could include as many of the following as is reasonable for your company and industry: postal mail, Internet, electronic bill pay, branch, pay-by-phone service, credit or debit card, electronic funds transfer, ACH, cash center, money order, mobile banking, third-party vendor service, etc. Based on the customer's preferred payment method, it is wise to advise him of how many days he should allow for the payment to be credited to the account.
This is an ideal moment to offer a recurring payment program where payments would be automatically debited from the customer's credit or debt card or checking or savings account. Offer an incentive for the customer to enroll in an automatic payment program, as this may provide the motivation for the customer to sign-up and, therefore, reduce the likelihood of missed or late payments in the future.
Close the call by thanking the customer for his business and selling the benefits of your product or service. Reassure the customer that if they have any problems with their product/service, then you are only a call away.

On a welcome and statement education call your customer service representative is building rapport with your customer and, possibly, identifying potential dispute, collection, fraud, or other problems. You are giving the customer an opportunity to build loyalty and trust with your company, so that if he does have a problem in the future he will not feel nervous about calling you to discuss his situation sooner rather than later. Depending on the product you are servicing, you may also want to mail the customer a welcome packet in the customer's preferred language with the above information in writing. The mailed material should not substitute for a live welcome call from a trained bilingual representative from your company as many studies have shown that U.S. Hispanic customers respond favorably to person-to-person contact.

The types of calls discussed in this article can be an invaluable tool to cement long-term relationships with your customers. In the Hispanic market, where customers respond favorably to personalized contacts, these calls give you additional opportunities to create customers who will not only happily utilize your company's products and services, but also pay as agreed, providing a boost to your accounts receivables.

Tony Malaghan is CEO of Arial International, a multilingual, muticultural consulting and training firm. Contact him at Tony@arialinternational.com.

Three Years’ Results in Two Days

Jeffry Pilcher
June 24, 2009

How does $35 million in deposits and 800 new members sound? That's what Advantis Credit Union just did—in only two days.

A recent grand opening sales event helped fuel one of the best first quarters ever for Advantis, with membership swelling by more than 4,000 in just the first three months of 2009 — impressive results for a credit union with $700 million in assets and around 40,000 members.

Most financial institutions usually have fairly limp grand openings — tea and cookies with the mayor and maybe a few giveaways. Not Advantis. Together with their ad agency partner Weber Marketing Group, Advantis took the grand opening of its new Orenco Station branch — the credit union's sixth — very seriously. The campaign's major components included:

Offers — 5% 11-month CD up to $50,000, 2% cash back on auto loans and Fusion Checking, a “rewards checking account” that paid 4% (currently 3.5%)
Major sweepstakes — trip to Hawaii
Two-day event — Friday 9-6 and Saturday 10-2. Free food, drinks, and “thousands of dollars in instant prize giveaways”
Newspaper ads
Direct mail targeted to members and non-members; included “match-and-win” instant prize numbers to help fuel traffic back to the branch
Radio broadcasts —live from the event to help drive traffic
Coordinated staff/planning

And here's the campaign's scorecard:

$35 million in new deposits
804 new members
1,125 visitors attended the two-day event
579 11-month promo CDs
409 savings accounts with a $694 average balance
25% increase in loan volume

This isn't the first grand opening sales event Weber Marketing Group has produced. They've been perfecting their strategy for the better part of a decade. Weber Marketing says branch traffic at these grand openings is phenomenal. Thousands of people show up and some credit unions have had to hire off-duty policemen to direct traffic on the streets and in the parking lot.

Despite staffing the event with around 20 employees, Advantis didn't have enough time to get accounts opened for everyone interested in the CD offer. “They had to hand out rain checks and scheduled appointments out for five straight weeks out,” Ruth Kapcia, Advantis account manager at Weber Marketing told The Financial Brand.

Location, Location, Location

A huge factor in this branch's success is its location. No matter how good your offers are, you won't get the big numbers if you have the branch in the wrong spot.

Reality check: Most credit unions don't use much more than gut instinct when picking future branch locations.

Many financial institutions think they know where their next branch should go: “Right here, at this busy intersection.” Some credit unions have even used member polls to ask, “Where should we locate our next branch?”

Advantis didn't use their intuition or rely on their knowledge of the market when locating its latest branch. They partnered with the financial facilities experts at Momentum, who deployed highly sophisticated software that maps out ideal potential locations based on traffic patterns/volumes, proximity to retail centers, density of existing financial providers, residential growth/decline, retail growth/decline, home prices, median income, ratio of owners/renters, etc. It's called geodemography.

This kind of plan is usually good for around five years out, and can map out where you should put your next x-number of branches. It also looks at your existing branch network to see which ones might need to relocate or close. Sometimes, a branch only needs to be relocated as little as a 1/4-mile down the road to improve its performance 4-5 fold, which more than compensates for the cost of relocating it.

Momentum also performed an extensive break-even projection for the brand eight months earlier. “Our process, developed with our partner CEO Advisory Group, creates an ‘eyes-wide-open' benchmark for management,” Jim Haack, president/Momentum, told The Financial Brand. “We utilize up-to-date market data, demand-side assumptions and expense projections that include both capital investment and operating expenses to yield our performance projections. The results at Orenco relative to projections were outstanding, exceeding the first year's goal during the event,” Haack said.

Bottom line: The average branch doesn't usually reach breakeven until around its fifth year, no sooner than the third. By picking the right location and using a robust grand opening sales event, Advantis's Orenco Station branch will reach profitability 1-3 years sooner. $35 million in deposits for one branch and 10% member growth in one quarter is phenomenal by any measure.

Direct mail piece. The front of the DM piece (when folded) is shown above. The inside of the DM piece is shown below.

Two-color print ad.

Weber Marketing Group worked closely with the financial facilities firm Momentum to create a new, branded branch prototype for Advantis including branch architecture, interior design. and merchandising.

Written and published by Jeffry Pilcher, www.thefinancialbrand.com is an online publication that focuses on issues and strategies that affect credit union brands. Reprinted with permission.

The Role of Succession Planning and Leadership Development in Successful CU Mergers Addressed in New White Paper

CUNA Councils
June 17, 2009

The role of succession planning and leadership development in successful credit union mergers is discussed in the first of two CUNA Councils white papers.

“Converging Executive Teams: The Role of Leadership Development and Succession Planning in Successful Credit Union Mergers” by the CUNA Councils offers a glimpse into credit union mergers, and the various approaches for bringing together a leadership team, depending on the scope and circumstances of the merger. Current merger trends and the reasoning behind those proposed consolidations are addressed, along with the potential impact of a lack of succession planning.

The paper concludes with three credit union merger case studies detailing how a chief executive was selected, an executive team was brought together, and a leadership development program was created to ensure the merger strengthened the continuing organization and its ties to members.

The second new white paper examines strategies for customizing collections to fit a credit union’s membership and market. “Collections: Not a Cookie-Cutter Operation” by the CUNA Lending Council examines program structure, industry trends, and working with collections agencies. It also looks at collections philosophies of helping members versus managing numbers.

Dana Rawlings, lending council executive committee member and senior vice president and chief operations office for Smart Financial CU in Houston, believes that collections objective should echo credit unions’ “People Helping People” philosophy. “So many credit unions focus on how many calls you make, and on keeping [delinquency and charge-off rates] down,” Rawlings said in the paper. “But if you help members, the numbers will take care of themselves. And those members will send others to your credit union.”

CUNA Council members are entitled to complimentary copies of these white papers; non-members may purchase the white papers for a price of $50 per copy.

The papers are available online in the white paper section of each council site - choose the “Cross Council” tab for the mergers paper or the “Lending” tab for the collections paper.

Nine Morals for Member-Centric Branding

Credit Union Magazine
June 17, 2009

"Creating beliefs in the hearts and minds of your customers about you, your company, your values—your brand—is the core element of success. That means keeping the promises you make … and even the ones you imply," says author Scott Deming.

Deming uses children's stories and fables to communicate cutting-edge principles of sales and service. He sums up his lessons through branding morals, by sharing his experiences, and by taking a look at successes and failures of other companies.

Here are nine morals to help your credit union brand live happily ever after:

Moral 1: Advertising, marketing, and branding are not the same animals

The differences may seem subtle, but you must recognize your uniqueness among competitors to be successful, says Deming. Advertising and marketing connect your credit union with its members. Successful branding, on the other hand, creates and supports a powerful perception and image of the credit union based on unique, emotional experiences—so powerful that the perception or image becomes a belief.

Branding is a feeling, says Deming. "You feel trust, loyalty, comfort, love, need, desire, and happiness for brands because of beliefs derived from very precise experiences. Maybe the advertising or marketing efforts of a company got you interested in the product, but they're not the factors that are going to build brand loyalty. That requires interaction with the people and with the brand, and these differences shouldn't be overlooked."

Moral 2: Be careful what you promise. When you don't deliver on brand promises, you fail to create or maintain uniqueness in your brand category. That yields no brand loyalty among members. They're just as likely to select a competitor's product or service over yours. In the reverse scenario, when a credit union overdelivers on its promises, it creates a feeling of belonging, culture, and family.

"It's this delivery that amounts to the ultimate customer experience," says Deming. "In turn, the ultimate customer experience creates just the sort of customers you want: ones who bring you more business." You want them to feel married to your credit union, he explains. "When you marry someone, you expect that person to remain monogamous, and that's the same feeling you want someone to have about your brand."

Moral 3: Separate yourself from the pack. When businesses get mired in sales quotas, short-term goals, statistics, and so forth, management and staff become robotic. Their eyes focus not on how the brand is doing, but on what the numbers tell them.

Instead, focus on exceeding member expectations, suggests Deming. Start by getting rid of impersonal member service techniques, such as e-mail or automated telephone services. Be proactive, he adds. If your members aren't happy, focus on rebuilding relationships.

"You must consider what you can do to differentiate your business from all the others that offer the same services or products," says Deming. "The differentiator must be the level of service, the unique experience you offer each of your customers. You have to engender loyalty in them so they'll go out of their way to shop with you, regardless of how far out of their way they have to go to get to you."

Moral 4: Perspective is everything. To really experience the credit union, step out of your own shoes and walk in the paths of members and employees. Ask "If I were one of the members right now, what would I want?"

Next, gauge staff loyalty. Loyal employees provide the ultimate experience for members, says Deming. Encourage loyal employees who stand behind your company's brand, he suggests.

When you walk in your members' and employees' shoes, he says, "Your perspective widens, and so does your concern about what's important. The benefits you receive from changing your perspective will far exceed those reaped from a narrower vision that includes only the bottom line."

Moral 5: You (and your brand) probably aren't as great as you think they are

The "Lake Wobegon effect" is a phenomenon common among many businesses, says Deming. It's the human tendency to think we're better than we actually are.

When you think your credit union is the best, you don't work as hard to keep making it better, he explains. "Always keep part of your gaze directed outward. And always be ready to re-evaluate your brand. Constantly ask yourself how you can improve on the experience you offer your customers. Finally, focus not only on what's working, but find aspects of your brand that aren't succeeding and do everything you can to improve them."

Moral 6: Understand your credit union's 'reach of influence'. Think about the ripple effect. You throw a rock in the water and ripples radiate out in all directions. Even after the water at the starting point returns to equilibrium, ripples continue. Your actions can create a similar ripple effect with members, explains Deming. Focus on actions that show you acknowledge and understand their needs. This creates a brand with a far-reaching, positive ripple effect. Evangelists will be ready to sing your credit union's praises near and far.

"Be aware the ripple effect works both ways," says Deming. "Just as happy customers sing your praises, unhappy customers will be quick to spread the word about poor service. If you break your brand promise, you'll suffer the effects of negative word-of-mouth, which can be more damaging to a business than a direct, negative experience. Your brand promise is inextricably tied to your reputation, and you want to make a big enough splash that delivering on your promise ripples indefinitely."

Moral 7: Don't pretend to be something you're not. Everyone has a brand identity, but they don't all understand it. However, you can't develop an authentic, sincere brand without this understanding, says Deming. Branding is not a matter of putting on a persona that others will like. It's not playing a role, putting on a mask, or pretending.

You don't want members to feel like they're being "sold" based on a false business persona, he explains. "When you're sincere about trying to understand your customers' needs, desires, and what they'd truly love from you, a genuine connection is made that's the foundation of trust between you and your customers," says Deming, adding that people who trust a business keep coming back.

Moral 8: The easy way isn't always best. Technology has made communication easier. But if you're not careful, too much reliance on technology can erode your brand, says Deming. While texting, e-mailing, and instant messaging are great ways to communicate, they bring reduced personal contact. Essentially, you lose the opportunity to create emotional connections and build your brand, he says.

Technology should help you streamline your operations, create new opportunities, reach a broader customer base, and reinforce your carefully developed brand, he adds. Effective use of technology is achieved, in large part, through mastery of your brand.

"Regardless of whether or not your business is brick and mortar or Web-based, remember to use technology to transcend, not replace, your brand," says Deming. "In the final analysis, don't let technology be the end of your brand. Let it be the beginning of expanding, extending, and sustaining it."

Moral 9: Don't drive members to a flawed service. Appearance without substance—advertising and driving people to your business without a powerful brand identity—leads to failure, says Deming. "Your values and sincerity are your brand, and any marketing or advertising efforts need to be based around that brand identity. Your brand can be created only by you and the relationships you develop."

"All these lessons work together to bring us to one critical conclusion: If you want to be successful, you must build a powerful, emotional brand," he says. "You must stop looking at customers with dollar signs in your eyes and start creating relationships with them. This may seem like an expensive proposition, but it's less expensive in the long run than neglecting relationships."

When members see that you truly value them and care about the service you provide them, they'll be members for life, says Deming, adding, "That's the real secret to long-term success."

Recent News

Tips for Successful ACH Usage Discussed in New Council White Paper

¡Bienvenidos! Best Practices for Using Welcome Calls in Your Hispanic Customer Service Strategy

Three Years’ Results in Two Days

The Role of Succession Planning and Leadership Development in Successful CU Mergers Addressed in New White Paper

Nine Morals for Member-Centric Branding