According to NFCC’s Financial Literacy Survey, roughly 1 in 4 U.S. adults do not always pay their bills on time. Depending on where your business falls on the priority scale of all the monthly bills your customers receive, it is inevitable that many of your customers will make late payments, or even skip payments altogether. Here are four steps to better billing that will encourage your customers to pay you on time, or even early:
1. Offer convenience. A recent Pew survey reported that nearly three in ten adults say the most common way to they take care of their regular monthly bills is by an online or electronic payment. Furthermore, the Federal Reserve has found that roughly one-third of consumers and three-quarters of businesses express willingness to pay a fee for payments that have faster availability to the payee. The best way to cater to this need is to implement an online invoicing and payment process. An automated billing system not only gives your customers easy access to their bills and the ability to pay, but can also be set to send your customers friendly email and SMS reminders.
2. Communicate a clear and colorful call to action (CTA). Adding color to messages can increase engagement rates by up to 42%. Additionally, color can aid in improving your customers’ memory. Studies have proven that color can help people process and store images more efficiently than black and white. By adding color to your CTA, customers are far more likely to engage and pay their bills. Try orange or another bright color! According to QuickSprout, orange CTAs boost conversion rates by about 32.5%, and red CTAs boost conversion rates by about 21%.
The CTA should be eye-catching so your customers are compelled to read it and act. When you clearly state exactly what you want your customer to do, it eliminates guesswork and encourages action.
3. Be consistent. Consistency is key to your customers knowing exactly where to find their balance each time they receive their bills. Online and printed bills should be identical, making it easy for your customer to quickly scan their bill to find how much they owe and when they need to make their next payment.
4. Utilize Incentives. Try positively incentivizing customers to pay you early. Incentives might include a 1 to 2 percent discount if payment is received within a specific timeframe. Early payment rewards work particularly well for companies you are billing that have a separate accounts payable department. In fact, they tend to cut checks first when they see incentives for early payments.
To learn more about how to optimize your billing and increase the amount of on-time and early customer payments, contact Lanvera today.