How to improve response rates to customer communications

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If you want to get your customers to respond to an official letter, you might be best off avoiding the CEO’s signature. At least, that's the slightly surprising finding from recent research by the Financial Conduct Authority (FCA), the UK’s new regulator for the financial services sector.

The FCA has been looking at ways of using behavioural economics to understand consumers’ decisions better. And, although the research was specific to the financial services sector, the results provide some useful insight for any company seeking to improve customer response rates.

In a speech last month, Martin Wheatley, the FCA’s Chief Executive, described the subtle behavioural changes that can occur when customers receive an official letter from a company.

In this case, the FCA explored different options for a ‘redress’ letter by a company offering to refund money to customers following a problem. Incredibly, the FCA found that most people – sometimes up to 80% of recipients – ignored such letters.

The regulator’s research studied how to improve response rates for these letters. The study, conducted jointly with a company sending out 200,000 such letters, randomly combined small changes to the letters to test the effects these had on response rates. For example, some letters included the company’s logo on the envelope while others used bullet points to highlight key points for the recipient.

Through these different combinations, the researchers discovered that:

  • The response rate to a letter from a customer service team is likely to be much higher than one signed by the CEO, particularly among female recipients.
  • Simplifying the letter was also key. For example, using bullet points to highlight the key points at the top of the letter and minimising text both helped to ensure people kept reading and took action.
  • Reassuring recipients that the redress process would be short also helped to increase response rates.

By making amendments such as these to the original content, response rates for the letter jumped by more than 10% – equating to more than 20,000 extra customer responses.

The research provides some useful lessons for anyone writing customer communications. Namely, always aim to keep communications clear and to-the-point, and consider breaking up long or complex sections of text with bullet points to highlight important information to readers.

And, of course, tactfully suggest that the letter doesn’t necessarily need to come from the CEO.

Read the full research here.

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