Companies Find Gold in Customer Billing Process

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TORONTO - Billing and collection specialist North Shore Agency says that after more than a few notifications and reminders, Canadian advertisers are finally beginning to get the message: There's marketing value in the customer-billing process.


Over the last 12 months, North Shore, Great Neck, NY, has seen a "substantial" increase in the number of Canadian companies interested in using billing as a customer-retention and upselling tool.


Perry Simardone, director of sales with the firm's Toronto office, said companies have traditionally viewed billing as a necessary evil. But with increasing emphasis being placed on developing and nurturing long-term customer relationships, it is now looked at in a new light.


The emerging perspective is that each bill sent out represents a contact point with the customer, so billing should be treated not as an expense but as a marketing opportunity.


For example, said Simardone, most delinquent customers eventually pay their bills, and payment generally indicates a continuing desire to do business with the firm. Reminder notices, therefore, should emphasize the company's interest in retaining the individual as a long-term, valued customer.


Further, if a company views late-paying customers as profitable over the long term, it should use reminder notices to promote the sale of additional products and services.


"Clients are looking at billing more and more because they see the cost of keeping a customer as being less than the cost of acquiring one," he said.


Simardone added that the most common weaknesses with bills is that they look like every other bill. "We go in with a letter that doesn't look like anything the customer has received before.


"We're going to charge more per mailing, but we raise response rates so fewer bills need to be sent and overall costs are lower."


Simardone says most Canadian companies have historically handled billing in-house, explaining "they haven't spent a lot of time on it because it's been viewed as a business afterthought."


But he says many are beginning to see it as a communications specialty best left in the hands of experts.


"We're seeing much more openness to full-service outsourcing in the last six months than we did in the 48 months before that."


In the US, where North Shore has been in business for more than 30 years, most of the company's business growth is generated by its billings division. Collections still represent about 70 percent of total revenue, but that's because the company has a large established base of collections clients.


In Canada, revenue is split equally between billing and sales.


Simardone said the five-year-old Canadian division has been making progress in selling its billing services, but not to the same extent as in the US.


However, he said the company's recent decision to focus on the credit card and telecommunications sectors should pay off soon in increased billing revenues. To date, North Shore's Canadian division has focused primarily on the direct marketing and publishing sectors.


Simardone says credit cards and telecommunications, including wireless phones and pagers, are fast-growth areas of the economy in which marketers have a sophisticated view of customer retention.

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