The move to paperless statements for utilities, healthcare, telecom, cable, insurance, credit cards, banks, and virtually every other consumer segment has been underway for two decades, yet many customers still insist on paper.
With annual costs per account from $30 to $60+ to generate and mail statements, your business could be losing millions every year because of hold-out customers.
And postage, labor, and paper costs continue to rise at an accelerating pace, making it even more imperative to quickly convert as many of your paper statement customers as possible.
The Easy Wins are Gone for Converting Customers to Paperless Statements
Early in the transition to paperless, many companies successfully converted customers with one-size-fits-all communication campaigns that highlighted the convenience of digital statements and benefits to the environment.
To increase their chance of success, some companies also leveraged their customer service interactions to prompt conversion, optimized the enrollment process, and even gave a small monthly discount for going paperless.
These tactics may still work somewhat, but conversion has dropped significantly because customers who are responsive have already moved to paperless. This means your return on investment (ROI) for continuing with a traditional approach may be low, or possibly even negative.
If you still have a large number of customers who haven’t converted to paperless, there is an approach that can deliver strong results and ROI with your hold-outs.
Analyzing Customer Data Can Identify Key Trends in Your Historic Paperless Statement Conversion
Your existing customer data represents a powerful tool for transitioning more customers to paperless statements, and a little analysis can deliver big results.
The first step in finding actionable trends is to assemble and analyze two data sets: those who’ve converted and those who haven’t. This will enable you to identify any differences between the two groups.
Characteristics that might emerge as indicators of having converted versus not include: age, geography, length of time with your company, product or service mix, whether or not they’ve provided an email address, profession, household size, household income, the channel through which you acquired them (e.g., direct mail, email, social media, site traffic, 1-800, etc.), as well as others.
While many consumer companies have rich customer data, even if your company doesn’t, you may gain actionable insights with just a couple of datapoints.
Once you’ve identified a few key customer characteristics that show measurable differences in your historic conversion rates you’re ready for additional analysis.
Identifying Segments Can Lead to Targeted Paperless Conversion Strategies
Using the key characteristic that stands out the most as predicting conversion, continue your analysis by adding a second factor.
As a first example, if there’s a pattern showing age has a negative affect on conversion (e.g., overall conversion declines with each rising age bracket), you can introduce another characteristic that also shows some predictive power, like geography. You may find in certain areas that age has a substantially negative impact on conversion, where in other geographies it doesn’t have much impact at all.
As a second example, you may find there’s a significant difference between customers who’ve provided an email address and those who haven’t. If that’s the case, introduce another variable, like age. If you see age doesn’t seem to be predictive try another characteristic, like the length of time they’ve been a customer. You might find that for customers you’ve acquired before a certain date, irrespective of age or other factors, you have the lowest percentage of email addresses.
For the first example you may consider a targeted conversion strategy focused on certain age brackets, in specific geographies, that have lower conversion.
In the second, maybe the reason you don’t have an email address is that when the customer was acquired your onboarding path wasn’t optimized to request it. In this case you might start with a simple paper statement outreach to ask for an email address, and then follow up via email with your paperless conversion program.
The outcome of this deeper analysis can help lead the way past a spray-and-pray approach, and on to developing programs specifically designed to appeal to targeted segments, resulting in strong conversion of your hold-outs.
Strategies to Ensure Strong Conversion from Your Segmented Paperless Conversion Program
Having identified specific customer segments you want to target, you can now begin developing your customized outreach program.
Your program might include:
- Concentrating on specific communication channels that are most embraced by the segment (e.g., some segments might prefer direct mail, while others will respond more strongly to social media or SMS messages)
- Customizing messaging because one segment might respond to convenience, while another to concerns regarding delayed mail, impact on the environment, etc.
- Deploying a communication series that has different benefits highlighted every month, testing which message gets the best response by segment
- Leveraging social proof by using a statement like: “78% of our customers in your area have already gone paperless and are enjoying convenience while helping the environment, are you ready to join them?”
- Offering incentives like gift cards, a monthly credit, a one-time credit, a promotional item with your logo, access codes to something they’ll find appealing, movie tickets, planting a tree in their name, etc.
- Allowing the customer to select a charity, from a list you provide, to which you’ll donate when they go paperless
The above is just a small sample of the many approaches you can take to generate strong segment-specific results.
How to Make ROI-Based Segment Targeting Decisions
Nearly every strategy you deploy will have a cost, either internal or external. To ensure you generate strong ROI on your efforts, you’ll want to first identify the full incremental per customer annual cost of paper statements versus paperless.
The reason to look at incremental cost is that even digital statements have some ongoing cost.
As an example, let’s consider a media company that has an annual paper statement cost of $65, while digital is $18, for an incremental $47. This means that if the target is to break even within 12 months, the maximum that can be spent per converted customer is $47.
In your analysis it’s important to identify every cost of a segment-specific campaign. Some costs will apply to the entire segment (e.g., communicating across multiple channels, sending direct mail, etc.) whether or not customers convert, while others, like incentives, will only apply to those who converted.
One final consideration for projecting your total ROI is the potential for upselling products and services.
When customers take action to go paperless, it demonstrates engagement and signals a potentially long-term commitment to you, and therefore presents an opportunity to immediately follow-up with offers for additional products and services.
Even if a small percent convert from an upsell campaigns it can quickly add meaningful revenue and profit.
Offering an Incentive Can Significantly Boost Conversion to Paperless Statements
Incentives have consistently demonstrated the power to move customers to paperless, so it’s smart to include one in your conversion program.
Choosing the right incentive, however, is a challenge that carries four big risks:
- Many targeted customers might not find it appealing
- It doesn’t feel valuable enough to some
- Fulfillment turns out to be complex and/or costly
- You spend more than necessary to hit the conversion target
One popular incentive choice is a gift card for a specific retailer or restaurant brand. While fulfillment can be streamlined by digital delivery, the drawbacks are that the brand won’t appeal to everyone, the face value might not be high enough to drive action, and you may be able to reach your goal with a less costly incentive.
Another choice is a code for streaming a movie. While the cost is low and it can be delivered digitally, many customers already have multiple subscriptions with access to any movie they want, and the perceived value of a single stream is low.
Given your objective of strong conversion, the ideal incentive will have mass appeal, feel valuable, be easy to fulfill, and have a low relative cost.
Entertainment®’s Dining Advantage®: An Appealing Incentive with High Value for Low Cost
Dining Advantage is a perfect paperless statement conversion incentive because it delivers incredible savings on dining out which appeals to virtually everyone, it has a high perceived value, it can be digitally fulfilled, and the price point is very attractive.
Dining Advantage is available in $25, $50, $100 and even custom increments, and can be delivered as a physical card or a digital code that can be sent via email or SMS. Cobranding is also an option.
Dining Advantage provides access to several hundred thousand valuable dining deals from our Entertainment discount network, the largest curated collection of local and national restaurant discounts in North America.
Unlike a branded gift card that can only be used with one brand, Dining Advantage is redeemable for deep discounts at restaurants across all dining categories and cuisines. This includes everything from fine dining, casual restaurants, pizza, ice cream shops, and even attractions and shopping!
With restaurant dining, including carryout, a significant portion of consumer spending, your customers will love the instant savings at neighborhood favorites and national chains. Entertainment’s best-in-class buy-one get-one free and up to 50% off offers will make their savings add up quickly.
How it works is that your customers use stored credits to select the specific discounts and offers that appeal to them, and then they simply show their mobile device to redeem the offer. It’s that simple.
With Dining Advantage, your customers will appreciate the great incentive you provided that helps them save over and over and, at a cost to you of only a few dollars per card, the ROI on your paperless statement conversion campaign can be very high!
Would you like to learn more about Dining Advantage and our other powerful customer incentive products? Let’s connect! Tell us about yourself and our team of incentive experts will evaluate how we can help your business reach and exceed its revenue and profit goals.