Are you trying to shortlist a Collection Agency by looking at their Google reviews or Yelp rating? According to inc.com – 88% of customers read an online review, influencing their buying decision. But, a single bad review can undo the value of 40 good customer experiences.
Those online review methodologies work well for restaurants and doctors, but the same criteria does not work well for the Debt Collections industry.
- Most negative reviews are left by debtors who hate debt collectors anyway. That is because the Collection Agency recovered some money from them, which they were not planning to pay.
- Some disgruntled employees who could not adapt to the pressure of being a Debt Collector leave a negative review about the job or the workplace. Maybe they could not make enough money as a debt collector and left a negative online Google review.
- Many clients submit highly disputed debts to a collection agency and expect that those debts will somehow be magically recovered. If a debt is highly disputed or too old, even a collection agency may not be able to recover those. No collection agency will recover 100% of the debts assigned.
- Satisfied people are often thankless. Not many clients who get good returns take the pain to leave a review for a Collections Agency on Google or Yelp. No one wants to publically announce online that they use the services of a collection agency. Some clients leave positive reviews because their Collection Agency Rep requested them to do so. Dissatisfied customers are more vocal, and so are the debtors.
- Competitors may intentionally try to plant fake negative reviews to sink the business of their rivals.
- Many businesses, including collection agencies, often hire “Reputation management firms” and professional marketing firms to ensure good online ratings, which has almost nothing to do with the real recovery rates of that collection agency. They attempt to game the online review system.
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We are not saying there is no way to gauge a collection agency, but due to the nature of the job they perform, they simply cannot be evaluated by general public reviews.
Many people from the accounts receivable industry crack jokes by saying that it is quite possible that a Collection Agency with horrible ratings on Google could be the best one (since it recovered so much money, it landed up annoying too many people). We are not recommending you use this judgment criterion either.
Many agencies that are rated higher on Google do so by requesting their employees, friends and only satisfied customers to leave 5-star reviews and thereby artificially raise their ratings. Unlike sites like Amazon, where we have a “Verified Buyer” tag next to a review, generic online reviews like those on Google/Yelp have no way to know whether the reviewer has even used a service or if the reviewer is a debtor, employee or someone else. Therefore these reviews are subjected to manipulation.
Some agencies simply push their ratings higher to take advantage of Search Engine Optimization. However, some agencies are genuinely rated higher, but we are talking very broadly. Better Business Bureau (BBB) ratings are a lot more reliable.
The right way to gauge a collection agency is by their recovery rates, product offerings, adherence to the debt collection laws, and the experience of their management and staff.
The medical industry uses Collection Agencies a lot. May you have a friend who is a doctor, he can recommend a good collection agency.
References:
www.inc.com/andrew-thomas/the-hidden-ratio-that-could-make-or-break-your-company.html