Fingerhut Direct Marketing, Inc.

Situation:  
Fingerhut Direct Marketing Inc, Eden Prairie MN, is an emerging direct to the consumer marketing company selling a broad selection of general merchandise. Products are marketed through catalogs and the Internet to consumers nationwide. The Fingerhut brand has a long, successful history serving the unique merchandising and financing needs of its broad customer base. 

Target:  Existing customer base

Objective:  
Create a customer friendly remittance operation that reinforces the Fingerhut mission and provides a successful 1 to 1 customer relationship management experience. 

Strategy:  
Incorporate the United States Postal Service’s Origin Confirm® service into the Fingerhut outbound billing and collection processes.  Fingerhut prints a unique origin Confirm code on each remittance coupon in every outgoing statement and collection letter.  The remittance coupon is then placed in a window envelope by their customer when sending a payment. When the return envelope hits the mail stream, the USPS provides unique scan data back to Fingerhut who loads scan data into an analytical database. The data is matched against active accounts to determine a course of action. The beauty of this process is the unique identifier code which allows Fingerhut to use Origin Confirm to identify each and every customer! 

Using Origin Confirm enabled Fingerhut customer service representatives to provide positive service when customers asked about the status of their payment. They were able to confirm that a payment had been mailed or provide the option to obtain an electronic payment helping the customer to avoid late charge assessment and created a positive customer experience.  

Prior to using Origin Confirm, over 25% of Fingerhut customer payments would cross in the mail with a collection letter or call. In the past, Fingerhut simply did not know if the “check was in the mail”.  Now, with Origin Confirm, they do know if the “check’s in the mail”.  Collection letters and calls are postponed to allow payment to make its way through the payment processing system. Fingerhut found that 98% of all scanned items contain account payments. 

The Collection Area saw the greatest ROI. The Origin Confirm scans provided Fingerhut with the leverage to increase money collected and drive more paid accounts.  

Results:  
The Origin Confirm project provided full payback in three months on a total investment of less than $50,000. The successful implementation of Origin Confirm allowed Fingerhut to realize $300k annualized savings through productivity gains and cost avoidance. They were able to remove over 25% of delinquent accounts from the collection process; have better control and earlier detection over payment stream delays and improve customer service.  Moving forward, the positive experience with Origin Confirm was a catalyst for Fingerhut to begin testing Destination Confirm and piloting OneCode Confirm™ on both letters and flats. 

Source: 	Fingerhut Direct Marketing, Inc.
John Deibel, Vice President Collection and Recovery