Receivable/Accounts - Information for Credit and Collection Issues

Wednesday, June 6, 2012

Social Media and the Collections Industry

In this day and age, most businesses are embracing social media.  And using it to good effect – point in case: I wanted to purchase cell phones for my children for Christmas, and I researched online, and found Petro Canada to have the best plan with unlimited texting and a cap on calls to prevent $5000 phone bills from calling Guam.  The problem?  I went to five different Petro Canada locations, and all of them were out of the model of phone I wanted to purchase.  Frustrated, I tweeted about it, and within 30 minutes, Petro Canada not only noticed, but messaged me that two phones had been reserved at a location in Kitchener for me.  Well done, Petro Canada.

However, the credit and collection industry is tentatively approaching social media, and rightly so – it is not ideally built for our industry.

The challenge is that while a collection agency may represent a hundred different clients, they are attempting contacting tens of thousands of consumers and businesses who owe money on a daily basis.   These are not the end-users, or the clients of the agency, but they are the focus of attention.  And very few people enjoy being contacted and advised they owe money.

The result of our industry’s business model means that there are thousands of complaints, cries of foul, better business bureau records, and disgruntled consumers on the internet, all reflecting negatively on a given company, or our industry as a whole.  And for the most part, the credit and collection industry remains silent.

What is Out There?

Third party collections is a highly competitive industry – many agencies are all vying for the same client base.  So there are many websites, blogs, and news pages all geared towards selling agency services.  However, as these pages are all available for viewing by creditors, competing agencies, and consumers, they are typically devoid of real facts or useful information -- The noise to content ratio is high.

Many other industries have taken advantage of third party collection companies failing to represent themselves in social media, and promote their services while demeaning or villanizing the collection industry – credit counseling services, debt settlement companies, law firms, bankruptcy trustees, and consumer awareness groups.  Some of the negative press is certainly warranted for agencies that have overly aggressive practices, but all collection companies get caught under this flood of consumer pique.

Facebook, Twitter, and community groups are the domain of the consumer – meaning that collection agencies seldom have traction here.  Often complaints arise from consumers who have suffered at the hands of agencies.

However, Linkedin primarily serves business needs of individuals and companies, and is far more receptive to the credit and collection industry.  While shameless sales and self promotion are a good portion of the communications here, specific industry groups, company pages, Linkedin Answers, blog links, and individual profiles often have real content about the industry, and honest discussion between fellow credit and collections professionals.

Finding and Contacting Consumers

The internet never forgets.  I can Google my friends’ posts to Usenet made back in university in the 80’s.  Web pages that have long vanished can be found with the Wayback Machine.  Information provided by individuals is gathered and collated in search engines on a regular basis.

Which means that collection agencies, when seeking consumers, can find facebook pages, message board posts, cell phone numbers, email addresses, and more.  And on an increasing basis, this information can lead to contact with consumers.

However, there are strict rules about agencies violating third party confidentiality – so while consumers can speak about the agencies, the agencies are bound to remain silent on specific collection matters, or cannot address individuals online with specifics. 

Creditor and Collection Agency Reputations

Because collection agencies, by reason of volume of consumer contacts, and a percentage of disgruntled consumers indignant over debt or how it has been presented, inevitably have negative feedback on the internet, it is crucially important that agencies invest time and effort into social media to give positive content and open a door for consumers to reach out in a positive manner to deal with them.

Collection agencies should be in the business of consequences.  And these consequences should be brought to bear with responsibility and restraint.  However, on a large scale, they can make an effort to educate consumers on what the consequences for non-payment are, and in creating awareness, build positive reputation for both their company, and by extension the creditors they represent.

While it isn’t likely that an agency’s Facebook page is going to have thousands of likes, and a constant stream of consumer contacts through their website because they put a friendly face on their banner graphics, creating an opportunity for communication with consumers over the internet is a growing concern and will inevitably be a need to fulfill.  Some agencies advertise a consumer ombudsman on their corporate websites – this is a step towards accountability to consumers online.

Something interesting to look at – go to Google Places and search for collection agencies in your area.  See how many have Google+ pages, or even have reviews.  Of the handful of reviews available, how many are satisfied clients, and how many are disgruntled debtors? 

Where Is This Going?

Whether there is a want or not, the credit and collection industry is being slowly dragged into social media, to participate in one form or another – while most agencies are unsure how to handle the scrutiny and exposure social media can bring to bear.

Potential clients may research their company, and determine trust by the number of negative reviews available.  Debtors can have an immediate impact on a creditor or collection agency’s brand with a simple post on the internet. 

While our industry is radically different now than it was ten years ago, and no one has a definite vision of where it will be, I personally believe that the credit and collection industry, and third party collection agencies specifically need to start thinking about their public image and put some effort into presenting a positive reflection of their company through social media and the internet.  This can be through consumer awareness articles, involvement in their local community, or some honest insight into their work process.  With some effort, these companies can be presentable to the internet community, if not accountable or even reputable.


I am very passionate about the role social media takes in credit and collections, both from an agency and consumer viewpoint.  If you have questions or would like to speak about this topic in length, feel free to contact myself at Kingston Data and Credit. 

Blair Wettlaufer
Kingston Data and Credit
Cambridge, Ontario


  1. What you're saying boils down to this: people prefer to do business with people. Putting a "face" (humanity, character, likeability) on any company makes it more attractive to deal with them. Social media is an ideal way to do this.
    Great article!

  2. Blair, this is such a fantastic post! I couldn't agree with you more. I think you're spot on when it comes to the "why" of debt collection agencies needing to have a presence on Social Media.

    I tell the collection agencies I work with that whether you like it or not, consumers are online having conversations about your business, and if you're not listening online and able to quickly engage and respond to critics, your brand suffers immeasurably.

    Since we live in a society where "Googling" someone is as common as using a telephone, a collection agency's online reputation - especially how it is portrayed on the first page of Google Search results - is everything.

    Potential clients, regulators, business partners and others are going to check out your agency on Google, and Google Search quickly indexes and shares all types of social media updates that mention your agency or employees by name.

    That means if you're not "listening" online, and if you don't have a positive, proactive and professional presence where you can quickly engage with the people who are talking about your agency, you're in trouble.

    The best agencies are not only "listening" online, but they're also quickly jumping in and interacting with angry consumers or other critics. Because while you won't always convert a critic into a supporter, you might be able to influence the "online peanut gallery" of people who are watching every online exchange your agency makes.

    Think of it this way: Imagine the next time you have a phone call with an angry consumer, there's a set of bleachers across from your desk. People are watching intently, taking notes and gathering impressions about whether or not you're the type of agency they'd want to do business with, or if they should start suing you (consumer attorneys are ALWAYS watching, aren't they!?) or launch an investigation into some alleged misdeeds being attributed to your agency.

    Well, that's what's happening on Social Media! Countless people can - and will - watch every interaction you have with a consumer online, and if you just ignore the online chatter about your business, it gives the impression that (A) the negative allegations are true or (B) you don't care.

  3. This is an excellent and thoughtful post, Blair.

  4. Interesting point about social media and the Collection industry. I think though, many people will not want to complain too much in social media or else risk outing themselves as debtors.

    I agree transparency is becoming a larger issue and I've based my company on it, creating web-based reporting solutions for Collection agencies and their clients.

    I believe that the future of transparency is between Collection Agencies and their clients, not social media. Learn more in my eBook on transparency - The Transparency Effect: (click link)