E-billing is better on the Web

A growing number of businesses and consumers are choosing to view and pay their bills, invoices and statements online directly at their billers` Web sites rather than through an e-mail interface. According to recent research from Gartner, 30 million people use e-billing services today, and the firm expects that number to reach 100 million by 2005. The same study shows that customers are calling for banks to present their bills online rather than by e-mail. Some 60% of respondents to a Gartner survey said they go directly to their billers` Web sites to access their bills, while only 27% opted for e-mail.

E-mail delivery should not be viewed as a standalone solution, but rather as a component of a broader Web-centric approach.

John Ziniades, CEO of Consology.

While online billing presents convenience, customisation and service to customers, for enterprise the return on investment (ROI) is equally compelling. Significant savings are achieved through a reduction in churn, deflecting calls to call centres or sales opportunities through cross- or up-selling.

Credit card companies and telecommunication companies have been the most active in developing e-billing Web sites and developing customer service functionality around them. They have had success in gaining consumer adoption and almost all of this has occurred at their own Web sites. Yet many firms employ the `e-mail only` philosophy when billing their clients. The solution in solving the e-billing delivery problem is to strike a balance. E-mail delivery should not be viewed as a standalone solution, but rather as a component of a broader Web-centric approach.

The ideal solution should include the best components of e-mail and SMS - push notifications - with the functionality of the Web`s `pull` environment.

For a small company, the generation of an invoice from within an accounting package into a PDF format, ready for delivery, is the ideal simple solution. A huge investment into a Web-delivery system does not need to be made at this level. For companies that value customers and that are in the high-volume business-to-consumer space, and especially for organisations with complex business-to-business requirements, e-mailing of statements is fraught with problems.

Proponents of the e-mail delivery method argue that no costly Web infrastructure is required. However, the simplicity and cost-effectiveness of e-mailing statements evaporates as soon as any two-way interaction is required between the company and the end-customer.

If that customer wants to do grouping and charting, manipulate the data, make a payment, dispute a transaction or look up a past statement, for example, it will require interaction on a Web infrastructure. The e-mailed bill is therefore only a first-phase, part-solution to the overall problem. At best, e-mail bills are an elementary static representation of the physical equivalent.

The Web, on the other hand, offers an intimate customer environment. With the Web model, the basic offering of bills, statements and invoices can be used for self-care, marketing and cross-selling to make the experience of visiting a company`s Web site that much more meaningful. The bill or statement can now form the foundation for an ongoing dialogue with the customer, which never existed in the physical world.

E-mailing this information to customers may seem like convenience for the customer initially, but will almost guarantee a sharp decline of Web traffic to the biller`s site and a lower level of interaction with customers, as they get their information pushed to them.

Other problems with e-mail include:

• .         In-box overload: With the Web you don`t have to store or archive invoices. You just read and delete notification e-mails, as your bills are stored online;
• .         Change of e-mail addresses: With the Web one does not have to re-route e-mail. Losing mail is not an issue as bills are available online.
• .         Personal e-mail at work: Web billing ensures your bills are still available if you leave a corporate environment, if an exchange server deletes an e-mail, or if for space reasons you cannot store the e-mails on a company server.
• .         Many people have free mail services with limited space which makes saving e-mail bills difficult because of size limitations. They will also not be able to download encryption software unless they have access to their own personal PC.

The ideal solution is a combination of Web and e-mail - push a notification to customers (via e-mail or SMS, that contains a summary of what is available in a full rich format in the biller`s online environment) and pull the customer back to the biller`s interactive online environment in order to provide a rich interactive environment. An e-mail push, if not used smartly, will end up driving customers from any interaction with the biller.

E-mail poses some security headaches too. Attachments are stripped off by corporate firewalls - and most people access their e-mail and Web services from work. Most companies have strict security policies in place that prevent any users from downloading any unauthorised applications and installing them on their machines. Encryption software, which keeps e-mailed bills from unauthorised users, typically takes the form of .exe files which would never make it through corporate firewalls.

The audit trail offered by e-mail delivery is a slight improvement in the `cheque`s in the post` guarantee of the physical world. One can tell when the `bill` was sent to the recipient`s e-mail address, but there is no information to tell if the user has received, successfully downloaded and opened the message. If users are on holiday and away from their computer environment, they will be unable to access the billing information. E-mail offers no embedded payment capability either. In the online world the company would know when you have sent the notification to the customer and whether or not that customer has logged on. You will therefore know if there are customer issues and would have escalation procedures in place to deal with these issues.

The ROI for billers that make use of e-mail to deliver invoices is entirely based on the savings that will be achieved with the elimination of paper and postage costs.

This was the grand promise at the inception of e-billing in 1996, and most companies realised quite quickly that parallel paper and electronic systems would have to be run for a significant period. The real benefit of communicating electronically with customers is lost by simply replicating a physical process via e-mail, that at best provides one with the same static view that was expected in the paper world.

The Web is the way forward for e-billing because it offers a wide range of interaction options. E-mail has a role to play but, as Gartner says, Web-based billing is set to skyrocket. South African firms should get ready for it. Many companies are already putting the online infrastructure in place and some first runners are already enjoying the customer competitive advantage offered by complete self-care solutions.