David Goldsmith is president and co-founder of MetaMatrix Consulting Group LLC. He spoke at the American Teleservices Association (ATA) conference last week in Sedona, AZ, and shared his views on the industry with DM News’ Giselle Abramovich.
Giselle Abramovich: What are the challenges confronting marketing strategists today, especially when it comes to teleservices?
David Goldsmith: A big challenge is the multidimensional buyer. That’s the consumer who uses a multitude of ways to interface with a company, including cell phone, texting, Internet access and live chat. Businesses need to service this customer effectively across all these channels, and that requires teleservices providers that have invested in new technologies, systems and people.
An example is DialAmerica. They’ve reinvented their call centers as multichannel contact centers with people [who have the] skills to serve customers across many different platforms. Companies that don’t make this transition will rapidly fall behind.
GA: How big is this market?
DG: According to the DMA’s Economic Impact Report, telephone marketing represented $47 billion of direct marketing and advertising expenditures in 2005. The same study found that the value of direct marketing-driven sales from telephone marketing in that year was $402.6 billion.
An estimated 6 million to 7 million people are employed in teleservices in the United States. These figures show that this is a big industry and it has a far-reaching economic impact.
GA:?What about the Do Not Call list; how does it impact the market?
DG: Prior to the initiation of the federal Do Not Call Registry, the combined total of all such lists then in place – those operated by state governments and trade associations – amounted to 20 million to 30 million records.
Now, there are over 145 million numbers on the federal DNC list. That’s an enormous change in the marketplace – one that swept up good companies like DialAmerica in a process that was really intended to eliminate abusive practices by some bad actors.
In many cases, however, individuals placed multiple phone numbers on DNC – their residential line, their home office number and their cell phone. So there’s another way to look at the numbers. Of the 75 million total households in the US, approximately half are on DNC. The good news is that the other half are receptive to being called and remain available to telemarketers. I should also point out that millions of names on the DNC can be called if they have an existing business relationship – an EBR – with a marketer. According to [some] teleservices experts, companies that have EBRs with households find they are very receptive to pertinent offers.
GA: What threatens the industry more than the Do Not Call list?
DG: I think a big threat is state-by-state initiatives that could potentially put further limitations on the teleservices industry – who you can call, when you can call, what constitutes an existing business relationship. These are the kinds of restrictions that could expand the impact of the federal DNC.
Another threat is the chase for the lowest cost-per-hour. It compromises a teleservices company’s ability to maintain a low supervisor-to-representative ratio. That ultimately results in poor customer communication and poor customer service, which eventually can translate into more government restrictions on the industry.
GA: Where are opportunities in the teleservices market?
DG: Whenever large new consumer markets are created, there will be opportunities for the teleservices industry. That was the case with the roll-out of high-speed Internet service and satellite radio. If any of the proposed universal health plans are enacted, millions of people will need to sign up. That could be a boon for the industry.
I also think there’s an opportunity for teleservices companies to connect with marketers looking to create tightly integrated programs.
The teleservices industry [today] needs to demonstrate how it can extend a print campaign, or support a Google advertising buy or handle a complex consumer transaction.
Finally, we’re seeing a growing consumer preference for call center reps who can speak English well. That trend could benefit companies like DialAmerica that operate entirely in the United States.
