By Karen Kosh, OnProcess Technology

The world as mobile carriers know it is changing. The days of subsidized mobile phones are quickly giving way to financing and leasing plans, to the tune of $37 billion by US carriers in 2015—and $50 billion by 2017. While there’s a lot of good in this for carriers and customers, there’s also a significant amount of financial risk.

The good is very good. These new installment plans offer customers a much easier way to pay, compared to traditional lump-sum payments. As a result, more customers are more likely to sign up for the latest mobile devices. The plans also help carriers remain competitive with other carriers’ offerings, which is crucial in an increasingly commoditized industry.

And the bad? Early-life, non-pay cancellations are steadily rising. And because recovering leased and financed devices is fraught with complexities, carriers are losing tens of millions of dollars annually from slow and non-returns, and stand to lose even more as these plans become more popular.

Adding to this is the huge challenge of collecting what are often large balances. Instead of a $200 termination fee, which is typical with subsidized phones under contract, carriers often end up chasing $1,000 or more for the average customer with two financed phones. Clearly, these debts are much harder and more costly to collect. Plus, the collections process strains the carrier-customer relationship, when what you really want to be doing is strengthening it.

So what can carriers do to mitigate the risk and financial impact? To make the bad better? In simplest terms, get customers to quickly return financed devices that aren’t fully paid for at termination, and leased devices that are early-life, non-pay cancellations – before collections activities kick in.

Getting customers to do this is part art, part science. First, you need to artfully show customers you’re their advocate, not their adversary. In a consultative fashion, explain why reducing their debt and avoiding collections by quickly returning phones is in their best interest. And then, make it very easy to return the device, for instance, by helping the customer obtain contacts and emails beforehand and using the lowest-cost transportation channel that’s convenient to the customer.

To accomplish this, it helps to have a specialized mobile device recovery program. A program that leverages the science of advanced and predictive analytics, along with rules-driven processes, to gain insights into customer behavior and actions you can take to accelerate recovery rate and velocity. A program that also enables carriers to prove “control of asset” from an accounting standpoint, which is required for leased devices.

In these changing times, carriers need to be more astute than ever about how to manage the post-sale financial customer relationship. If you want to achieve results that are more of a win-win for everyone, contact us to learn more.