Retailers Leading Move to Web-Enabled Technology

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LONDON -- Retailers selling goods through the Internet are expected to take the lead in introducing Web-enabled technologies to their traditional call centers in Western Europe, according to a recent study by research firm Frost & Sullivan.


Because of the enhanced selling capabilities of collaborative browsing technology -- which gives agents the ability to "push" pages onto a customer's computer screen -- companies are expected to adopt these technologies for their call centers in the next few years.


In addition, increasing consumer bandwidth is expected to allow for the introduction of additional Web-based communication tools for call centers.


"Finance and telecom are the two biggest sectors, but then I see retail sort of taking over at the end of 2003," said Ian Rowlands, a research analyst at Frost & Sullivan. "That will become the biggest sector, mainly because of this cross-selling aspect."


Although telephone agents have long been trained to upsell and cross-sell products to consumers who call in via traditional phone channels, the ability to add a visual component stands to greatly increase selling efficiency, he said.


"The opportunity to cross-sell and upsell is absolutely massive," Rowlands said. "I think one of the major benefits of shared browsing is that they can actually see the product in front of them.


"With just a phone call as your selling tool, you can only describe things verbally, but with shared browsing, consumers can actually see a picture of their hotel, or see a picture of their jumper or dress."


Although the retail sector is not one of the leading industry segments using Web-enabling call center technologies, Rowlands predicted that this would soon change.


He estimated that total sales of Web-enabled software -- including callback technology, live Web chat and collaborative browsing technology -- were only about $18.3 million last year.


Spending by finance companies accounted for about 45 percent of that amount, and about 35 percent was investment by telecom and technology companies, while investments by retailers accounted for only 4 percent.


By 2006, however, the market for Web-enabling technologies will grow to $603.6 million, and retailers will spend 35.8 percent of that amount, Rowlands predicted.


While most European companies are just beginning to experiment with basic Web-enabling tools such as Web buttons for callbacks, voice-over Internet protocol -- or VOIP -- technology eventually will take over as the leading medium for Web-based communication, Rowlands said.


VOIP, which is just gaining ground in the US, is still viewed as an inferior medium for communication in Europe. It also requires more bandwidth than most consumers have, but Rowlands said he expects it to gain ground quickly.


Callback buttons on the Web are still the most widely used technology in e-commerce centers, representing 56.5 percent of investments, while 43.5 percent of investments were in live text chat technologies, according to Frost & Sullivan's research.


Rowlands said that by 2002, VOIP would be about 17 percent of the market, and that by 2006, VOIP would be the dominant medium for communication between consumers and call center agents, accounting for 65.8 percent of the market. By that time, he said, text chat technologies will account for 17.6 percent of the market, and callback technology will comprise only 16.6 percent of technology investments.


"There's going to be a dramatic turnaround," Rowlands said. "The companies I spoke to will include VOIP. It's just a matter of the demand from consumers."


Rowlands identified several barriers to the widespread use of Web-based technology in call centers, including the cost of implementation and the lack of clear-cut evidence that such technologies would have a positive impact on the bottom line.


"There [have] been a lot of people saying that it has made their call center more efficient and [has] increased productivity, but there's a lack of numerical information to back this up," Rowlands said.


"So a lot of companies are putting off investing in Web-enabled call centers until they've seen the figures to back up this sort of investment."


In addition, companies need to develop strategies for integrating their e-commerce communication functions with the rest of their operations, Rowlands said.


Companies that did not conduct transactions through their call centers must suddenly establish communication between their call centers and their production facilities when they launch e-commerce operations. That adds a layer of complication to Web-enabling the call center.


"Before, agents were seen as sort of a help desk point person when [a] customer had a problem with a product or service," Rowlands said. "Now they're sort of seen as actual salespeople."
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