Should More Banks Be Considering After-Hours Contact Strategies?

Deciding the appropriate time to contact customers is sometimes a difficult choice, with many businesses assuming customers will not respond to communications outside of normal working hours. This has at times meant waiting until the next day before contacting customers around suspicious and potentially fraudulent activity, but is this necessary, asks Daniel Melo

Deciding the appropriate time to contact customers is sometimes a difficult choice, with many businesses assuming customers will not respond to communications outside of normal working hours. This has at times meant waiting until the next day before contacting customers around suspicious and potentially fraudulent activity, but is this necessary, asks Daniel Melo

Based on recent work with two of our banking clients, we have discovered that after-hours contacts can be effective. In fact, they can sometimes be more effective than contact during working hours. Success depends on when you try to make contact after hours, and through which channel.

After-hours interactive SMS

 

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One of our clients, a large European credit card issuer, implemented a two-way SMS strategy for possible frauds. In this case, after the initial suspicious activity was identified, a text was sent to the customer with an explanation of the situation, the process, and the need for them to respond. Then a subsequent message was sent with transaction information, asking the consumer to confirm if the activity was genuine or fraudulent.

Contrary to conventional wisdom, response rates after hours (between 8pm and 8am), were significantly higher at 66% than business-hour rates (8am to 8pm) at 50%. Interactive texts for simple transaction verification were clearly effective and acceptable to these consumers.

We also found that the speed at which consumers responded to after-hours SMS alerts was very good. Of those consumers that responded, more than 80% did so within 15 minutes of the initial contact, which means that issues were resolved far more rapidly.

SMS invite for inbound calls

Another European card issuer pursued an SMS-to-call strategy. Here again, conventional wisdom suggests that you shouldn’t contact customers and invite them to call outside of normal business hours. However, the client sent customers SMS messages immediately to alert customers of suspicious activity on their cards or accounts after business hours. Customers were instructed to call and confirm if the activity was genuine, or speak to an agent if it was suspicious.

For card transactions, about 30% of consumers responded when contacted between 8pm and 8am, while 60% responded for internet or telephone banking transactions. The response rates for the latter are significantly higher, because the sums tend to be larger and are often transfers to friends or relatives, vs. card activity where the value is often smaller, and people have other payment options (other cards or cash).

 

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After-hours strategies are applicable in many other situations, besides fraud management. For example, financial institutions can use after-hours contact methods to effectively and unobtrusively flag payment schedule changes, service interruptions and billing irregularities.

Customer acceptance of after-hours contact is clearly shifting, so implementing a contact strategy that engages customers quickly, and cuts overall transaction time is well worth implementing. It also increases customer satisfaction because it allows the consumer to resolve the situation on the same day, rather than having to wait for in-hours contact. This factor has helped alleviate the typical "morning rush" of call volumes, reducing consumer wait times at peak hours and further bolstering customer satisfaction.

With such clear benefits to a revised approach to customer contact, do you think more banks will implement this strategy?