The FDCPA Paradox of Targeted Voice Messaging Technologies

Most consumers, if given an option, would rather speak with a live operator than a computerized recording when seeking out customer service.  Computerized recordings, though programmed to sound human, empathetic, and helpful, often won’t bend the rules the way a live agent will.

When dealing with a live customer service representative, consumers feel like they have some control of the situation.  They can plead their special cases to a human being with feelings – feelings that can be appealed to, so that, when the tale of woe regarding the color printer that only prints in blue (though of course through no fault of the owner or the owner’s toddler) is told, there may be some sense of leniency (“Receipt?  But what if I didn’t keep that?”) and a satisfactory resolution for all.  If, by “all” one really only means the consumer.

That need for the human touch, for human interaction, dries up, however, when the topic of collections calls is raised.

Consumer debt growth shows no sign of abating any time soon; and with that debt comes delinquency.  Hence the collection calls.  The first step of almost any attempt to collect a past-due debt is to alert the customer, either by phone or by letter.  And when it comes to phone contact, most consumers would rather deal with a computerized voice mail recording than they would a live agent.

“A lot of that has to do with shame,” says Matt Edmunds, Vice President of Industry Marketing and Analytics at SoundBite Communications.  “A computer program or voice mail message doesn’t know or care what kind of debt you have.  Customers want to feel more in control.”

The emergence of debt purchasing as a true market force in the ARM industry has had an effect on the strategic thinking at traditional third-party collection agencies.  Both increased portfolio pricing and higher liquidation expectations are now factoring into collection agencies' recovery strategies at an increasing rate.  The usual arsenal includes both manual and predictive dialing environments.  However, in a paradigm where over 50 percent of a collector’s time could be spent wading through wrong-party connections and answering machine pickups, these usual routes to recovery may negatively impact an agency’s bottom line.  As Edmunds explained, “Collection agencies are using dialers and manual dialing to contact debtors , both of which contribute to collectors talking to wrong parties.”

Which brings us back to SoundBite, and firms like it, which provides advanced/targeted voice messaging technologies.

Advanced/targeted voice messaging technologies offer an attractive and effective way of contacting debtors.  There are three common types: Alert Messages, which require no live agent and don’t solicit a customer’s response; Interactive Voice Messages, which are automated, two-way communications that generally guides the recipient through an agentless transaction, such as an automatic payment; and, Direct Connect Messages, which connects the recipient with a live agent after verifying that it has reached the right party.

In these cases, a computer program does the heavy lifting, leaving collection agents free from wrong number time-sinks and voice mail messages.  More than that, though, voice messaging firms suggest that these technologies actually boost revenue by ensuring optimal penetration.  SoundBite further suggests that, by making it easier to collect the same or more revenue with fewer full-time employees, agencies can realize greater profits by decreasing overhead expenses.