client retention, client referrals: sharing best practices

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Sharing Best Practices

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Client Retention, Client Referrals: Sharing Best Practices examines proven approaches to DMP provision. The presentation reviews factors that lead clients to leave their program prematurely, as well as a variety of measures you can implement to increase client success. In addition, attendees will learn how to develop strategic community relationships to increase the reach and scope of their credit and housing counseling programs.

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Page 1: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

Page 2: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

2

Areas of Focus

Stabilizing Client Base

Aiding Client Success

Community Engagement

Creditor Trends

Page 3: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

3

ENGAGE CL IENTS TO “GET THE WORD OUT”

Stabilizing Client Base

Page 4: Client Retention, Client Referrals: Sharing Best Practices

4

Sharing Best Practices

Referral Programs

Referral

programs can be

beneficial to the

community, and

your agency.

Page 5: Client Retention, Client Referrals: Sharing Best Practices

5

Sharing Best Practices

Referral Programs

However,

compensation

referral programs

can be in

violation of many

state and federal

laws

Page 6: Client Retention, Client Referrals: Sharing Best Practices

6

Sharing Best Practices

Referral Programs

As we have seen,

non-adherence to

state and federal

guidelines can

draw unwanted

attention

Page 7: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

7

Successful Referral Programs

Ask clients to refer family members, friends, and

colleagues

Management drives the message

Instilled in agency culture

Consider every touch point as an opportunity to reinforce

messaging

Page 8: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

8

Agency Culture Drives Results

Client Base of 10,0000

50

100

150

200

250

50

200

Traditional Agency Re-ferralsEngaged Re-ferral Culture

Traditional Agency

receives .5% Referral

Enrollment Rate (of client

base)

Referral Culture agency can

receive as much as a 2%

Referral Enrollment Rate (of

client base).

Monthly Enrollment

Page 9: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

9

Stabilizing Client Base

Attrition (4% Monthly)

Traditional Agency Referrals (.5% Monthly)

Engaged Referral Culture (2% Monthly)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

400

50

200

350

200

Public Outreach & Advertisements

New Clients From Free Referrals

Client Base of 10,000

Page 10: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

10

Every Touch Point Possible

Page 11: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

11

Every Touch Point Possible

Page 12: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

12

Economic Messaging

Addresses current

economic issues

Builds a relationship

of comfort and

guidance

Page 13: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

13

Industry Messaging

Educates as to the

dangers of debt

settlement

Offers solutions for

friends, family

members, and

colleagues

Page 14: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

14

Congratulatory Messaging

Build positive rapport

Encourages future

referrals

Page 15: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

15

Completion Messaging

Congratulates client

on their success

Encourages client to

share success with

others

Page 16: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Additional Touch Point Opportunities

There are many

opportunities to

engage clients for

referrals

Client Services interactions

Account correspondence (i.e.

statements, client letters, e-

mail, etc.)

Phone technology

Educational material

Page 17: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

17

CREATING A SUCCESSFUL EXPERIENCE

Aiding Client Success

Page 18: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

18

First Few Months of Enrollment

Clients can be:

Cautious,

Unsure, and

Fearful

Page 19: Client Retention, Client Referrals: Sharing Best Practices

19

Sharing Best Practices

The Road to Plan Success

Comprehensive

Budgets

Accurate

Implementation

Set Expectations

Urging Client to

Save

Page 20: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

20

Roadblocks to Success

Some Examples:

Poorly Constructed

Budget,

Unclear DMP

Expectations, and

Declined Proposals

Page 21: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

21

Budget Construction and Success

Average Length on Program (in Months)

0 5 10 15 20 25 30 35 40

Comprehensive Budget Rudimentary Budget

Based on Cambridge Internal data

16+ Expenses

10 or Less Expenses

Page 22: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

22

Basic Budget vs. Comprehensive Budget

HousingUtilitiesAutoLiving ExpencesChildcareInsuranceMedicalEntertainmentMedicalMiscellaneous

DaycareAllowanceSports / HobbiesApp DownloadsBirthday / Holiday GiftsDiapersFormulaApparelBaby FoodChildcare Items Toys / Video GamesTuitionChild Support

Automobile Loan / Lease PaymentAutomobile InsuranceExcise TaxGasolineMaintenance (Scheduled and Unscheduled)

ParkingRegistrationRepairsTolls

Examples of counselor digging into category expenses.

Page 23: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

23

“An Ounce of Prevention…

First DMP summary the client

agrees to should not be altered!

Second guess enrollment

Become confused

6% to 14% default on first

payment- range

2% default on first payment –

Cambridge “- is worth a Pound of Cure”

Page 24: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

24

Common Proposal Decline Reasons

Creditor Needs Increase

Age of Account

Recent Activity

Account Insurance

Incorrect Client Information

Invalid Account Number(s)

Inaccurate Balances

Misspelled Client Name

“Promo” Plan

Page 25: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

25

Accepted Proposals

Average Length on Program (in Months)

0

5

10

15

20

25

30

35

40 38

33

28

All Proposals AcceptedOne Proposal DeniedTwo or More Declined

Based on Cambridge Internal data

Properly implemented plans increase success

Page 26: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Setting Expectation

Transparency

and engagement

enhances DMP

success

Full Disclosure

Benefits, and more importantly

Challenges

No room for error (missed payments)

Inability to secure responsible financing

Past due accounts

Reinforce Through Communications

Counselors

Support Staff

Educational and Program Material

Page 27: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

27

Managing Past Due Amounts

In 2010, 29.8% of common creditor accounts audited during the fourth month of

enrollment had some level of delinquency status, even though 98% of the

common creditors had all of their benefits in place

Past due amounts on statement cause confusion and uncertainty about plan

effectiveness

Ways accounts can be brought up-to-date

Eligibility for re-age through a DMP

Will be brought current in time

Additional payments to make up past due amounts.

Page 28: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Past Due Amounts on Statements

Number

One reason

clients leave

program

Examples of accounts brought

current over time:

Citibank, HSBC, Discover

Examples of accounts not

brought current over time:

Bank of America, Chase,

Capital OneBased on Cambridge Internal data

Page 29: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Video Education Program

Cambridge

developing

video campaign

to prepare clients

for DMP

transition

Page 30: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Agency Culture: We’re not just a

way out of debt…

Engage clients

to actively

participate

with the

program and

build savings

Page 31: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

31

Client Savings Enhance Plan Success

55.6%

71.0% 65.8%54.7%

71.7% 65.5%

85.2%93.3%

77.6%

Clients who Reviewed Budget Clients that Tracked their ExpensesClients who Built Savings

Page 32: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

32

FAITH BASED, CREDIT UNIONS, OTHER NON-PROFITS

Community Engagement

Page 33: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

33

Council of Churches of Greater Springfield

75 member churches.

50,000 local parishioners.

Our counselors provide:

Foreclosure Intervention, Pre-purchase Education,

Post-purchase Education, Financial Literacy, and

Credit Counseling

Page 34: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Faith Based Programs

The faith based

community has been

receptive to debt

relief services

Community has largely lost faith in debt relief

services

Pastors have the faith and trust of parishioners

Pastors routinely council parishioners on

personal finance matters

Most pastors are not aware of credit and

housing counseling services

Organization like the Council of Churches exist

throughout the country

Page 35: Client Retention, Client Referrals: Sharing Best Practices

35

Sharing Best Practices

Faith Based Outreach

Cambridge held

it’s Hope, Faith,

and Healing

Financial Forum

for clergy and

public officials in

March of 2011

Page 36: Client Retention, Client Referrals: Sharing Best Practices

36

Sharing Best Practices

Credit Union Collaboration

Cambridge produced

the Credit Union

Partnerships video to

educate Credit Unions

about the benefits of

collaborating with

Credit Counseling

Agencies

Page 37: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

37

Mission Overlap

Credit Union Philosophy:

Seven Cooperative Principles.

Open Membership, Democratic Control, Member

Economic, Participation, Autonomy, Education,

Cooperation, and Concern For The Community

These principles work in unison to ensure the best interests of

members are upheld

Page 38: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

38

Credit Union Collaboration

Place brochures in branches

Provide pre-purchase counseling education

Facilitate Credit Union financial literacy programs

Provide educational content to members

What other value can we offer?

Page 39: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

39

Collaboration and Funding

Although the NFCC participates in a

national venture with the United Way,

there are local opportunities .

Cambridge participates with our local United

Way’s Income Stabilization efforts

Provide expertise into the development of

grant making, public policy/advocacy and

community engagement strategies.

Create linkages between housing,

workforce development, financial

management and basic needs focused on

holistic approaches to service delivery

Page 40: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

Are You Listed In Your Local

United Way’s 211 Directory?

2-1-1 is a free

telephone directory,

available

throughout most of

the United States,

offering access to

health and human

services information

Page 41: Client Retention, Client Referrals: Sharing Best Practices

41

Sharing Best Practices

Employee Involvement

Your employees

may have

relationships with

friends, family, or

through alumni

associations, and

philanthropic

endeavors

Our employees serve on boards and advisor

committees with agencies and initiatives such as:

Habitat for Humanity,

United Way,

Science, Technology, Engineering, Mathematics

(STEM 21),

Junior Achievement,

National Association for the Advancement of

Colored People (NAACP), and

Association of Latino Professionals in Finance and

Accounting (ALPFA)

Page 42: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

42

CREDITOR POLICY UPDATES

Trends

Page 43: Client Retention, Client Referrals: Sharing Best Practices

Sharing Best Practices

43

Chase CTA

CTA usages varies between 15% to 70%

Average 35%

Chase Review

20 agencies

20 random accounts

Areas of Concern

Household where spouse unfamiliar with debt

Business owners use of credit card to fund operations

High lifestyle expenses

Page 44: Client Retention, Client Referrals: Sharing Best Practices

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Sharing Best Practices

New Trends

Creditor

policy

changes

BOA

Proposals declined if agency proposes

more than client paying on their own

Citi – One and Done

If client misses a payment and does

not make it up by next payment, they

are dropped from plan permanently

Consider waiting to send proposals

until qualified payment is received

Page 45: Client Retention, Client Referrals: Sharing Best Practices

Thank You

Christopher VialePresident and CEO Cambridge Credit Counseling Corp. [email protected]