TELEMARKETING: A line on quality - The UK may have more call centres than the rest of Europe, but are standards as high as they ought to be? Ken Gofton reports

The UK leads Europe in the telephone revolution. Neil Taylor, head of marketing for BT’s CiB call centres, calculates that across Europe there are 600,000 call-centre seats, of which 250,000 are British-based.

The UK leads Europe in the telephone revolution. Neil Taylor, head

of marketing for BT’s CiB call centres, calculates that across Europe

there are 600,000 call-centre seats, of which 250,000 are

British-based.



But are we talking quantity rather than quality? Have companies grasped

the idea that the telephone enables them to give a better service and

not just a cheaper one?



Teleperformance, the French-based bureau network with 70 call centres in

26 countries, hands out annual awards based on an international mystery

shopping survey it conducts into call-handling standards. The UK, it

claims, performs little better than average in the international

rankings. It trails well behind the US and Canada and a number of

continental countries, including Switzerland, Belgium, Austria and

Norway.



Global reach



The survey is a major undertaking, although Teleperformance is the first

to admit its limitations. Twenty mystery-shopper calls are made to each

of at least 100 companies in 21 countries worldwide. Results are

assessed according to ten criteria, including speed of response, warmth

of the greeting, product knowledge and overall efficiency.



This year, 54,000 calls were made to more than 2000 firms.



’We don’t try to pretend it is totally scientific,’ says Neil Perring,

joint managing director of BPS Teleperformance, the group’s UK arm. ’As

the basis for the awards, it’s intended to have significance, but also

to be a bit of fun. Because of the cost, it’s just not possible to

include everyone. On the other hand, having 100 call centres as our UK

sample takes in all the really significant ones.’



The UK results show financial services performing best. Richard

Branson’s PEPs-to-pensions operation, Virgin Direct, was the UK winner,

followed by telephone bank First Direct and car brand Audi. Travel and

consumer goods - two sectors where a quarter of all calls went

unanswered - performed worst and pulled down the UK average (see table,

page 36).



It is widely acknowledged that international comparisons are tricky.



Some experts suggest that you would expect the smaller continental

countries with high living standards and smaller call centres to provide

a better service than the UK.



James Wilkinson, vice-president of telemarketing consultancy TSC Europe,

has an intriguing alternative suggestion: the UK led the way with

telemarketing in Europe and has now entered a more mature second phase

ahead of other countries.



’Everyone starts off with very good standards, but then they have to

justify the cost of maintaining that level, and you find that standards

slip slightly,’ he says. ’However, you have to balance that against

customer perceptions. People quickly notice if it takes longer to pick

up calls and if the operators don’t seem to be as well trained and

informed as they were previously.’



Across frontiers



Controlling standards is difficult enough at the best of times, but how

do you manage it when you run call centres in several different

countries?



American Express took the international prize in this year’s

Teleperformance awards. Jim Hobby is head of the company’s European

customer service centres, including its ten call centres. He answers

this question by pointing to Amex’s mission statement: to be the world’s

most respected service brand.



That aim is carried through to every level of the organisation, Hobby

claims. The company believes that satisfied staff mean satisfied

customers, and ultimately satisfied shareholders.



Satisfaction scores are regularly monitored, as are service levels. ’We

use a balanced score-card approach, covering both productivity and

quality,’ says Hobby. ’For the call centres specifically, that means

traditional measures such as answering within 20 seconds and reducing

the numbers of lost calls. But all my call centres are set the same

service targets; I see no reason to differentiate between them.’



The Teleperformance survey suggests that financial services are setting

the pace in the UK and may have something to teach other industries. The

truth is, although the sector reflects some best practices, it also

reflects some of the worst.



Leading the way



BT will soon be publishing a major piece of research carried out on its

behalf by the Futures Foundation, looking at the use of telemarketing in

various industries.



’It is absolutely true that there is greater penetration in the

financial services sector than anywhere else,’ says BT’s Taylor.



’As many as 80% of companies in the sector claim to offer some services

on the telephone. It’s estimated that financial services account for 26%

of all telebusiness, making them the biggest by far.’



But Taylor is sceptical about overall standards, away from some of the

high-profile examples such as Virgin Direct, First Direct and Direct

Line - all of which had a revolutionary vision when they were first

established.



Financial services, he argues, lend themselves to being sold over the

phone. However, the companies were pushed down that route, some of them

unwillingly, because of a combination of deregulation and the impact on

their businesses of pioneering phone-based banking and insurance

services such as First Direct.



Diverting resources



Look at the high-street banks, for example. TSC Europe claims that banks

now receive more phone calls than visits to their branches. In many

cases they have coped with this by diverting calls to regional call

centres.



Customers believe they are speaking to their local branch but they are

not.



In theory, this shouldn’t matter if the right systems are in place.

However, TSC’s Wilkinson says it is a transitional mode; the regional

call-centre staff are trained to handle particular queries very well,

but lack the flexibility of local counter staff. The study by the

Futures Foundation suggests that among people who have contacted their

banks by telephone, only 16% consider the service excellent.



’We found that there is a clear recognition in financial services that

they need to improve customer services over the telephone,’ says BT’s

Taylor. ’They know they have to do better, and their willingness to

recognise the problem is probably higher than in any other sector.



’However, they tend to think they’ll do this through the use of more

advanced equipment, or by encouraging more e-mail and internet

business.



In short, they’re looking to new technology as a panacea.



’But it is no good getting an efficient front end to your business if

the processes that support it are archaic. All that does is further

reduce customer satisfaction. There is nothing worse than unfulfilled

expectations.’



Wanda Goldwag, Air Miles’ director of sales and relationship management,

agrees that technology does not solve everything. Telemarketing is

central to running one of the country’s best-known loyalty schemes, and

the company has a large call centre at its Crawley headquarters with 920

staff.



Air Miles is a particularly complex operation. Telephone staff need to

be able to switch from confirming how many Air Miles a customer has

collected to consulting airline timetables. They also tap into British

Airways’ database to confirm availability of flights and make

bookings.



Last year things began to go horribly wrong. The general surge in use of

the phone, which has made telemarketing one of the UK’s most dynamic

industries, was compounded in Air Miles’ case by its own rapid

expansion.



Delays in responding to calls rapidly reached unacceptable levels.



The company will be opening a call centre in Warrington in October,

initially with 200 staff and expanding to 800. Partly in an attempt to

take pressure off Crawley, a web site was launched in November

(www.airmiles.co.uk). Collectors can use it to check their totals and

look at flight availability.



Speeding the process



Goldwag says: ’We’re now getting several hundred hits a day. What

happens at the moment is that people visiting the web site do quite a

lot of work themselves. It’s likely that they will still want to speak

to someone, but by the time they do they are more sure of what they

want, so the calls are shorter. But I don’t think web sites will replace

call centres for some time.’



Perring, at BPS Teleperformance, says that one of the clear trends to

emerge from his company’s annual bout of mystery shopping is the growing

use of technology to channel calls - if you want accounts press 1, if

you want the systems department press 2, and so on. Used properly, it

saves everyone’s time, but it can be a source of frustration if

customers are unsure which department they want.



’Looking back over ten years, I’d say that overall call-centre standards

are higher,’ says Perring. ’But the number of really excellent companies

is still roughly the same. And an odd feature seems to be that, with

very few exceptions, companies seem to go through cycles of

excellence.



’The reason is that it is almost impossible to maintain excellence for

ever. In bureaus it is not such a problem; after two or three years

staff have generally been promoted or have left. But in in-house call

centres it is quite possible to find people who have been doing the same

job for ten years, and in time that could become 20 or 30.



’How do you keep staff motivated and fresh over that length of time?



It’s not easy. All I can say is, hats off to companies like First Direct

who put lots of emphasis on training and, broadly speaking, seem to be

able to pull it off.’



WINNING LINES



Virgin Direct’s call centre in Norwich must be one of the few in the UK

to have been ’feng shui-ed’, to provide a harmonious environment for its

200 operators.



Needless to say, that is not the sole explanation for how it came to be

voted top UK call centre in this year’s Teleperformance international

awards.



’There is always a Virgin way of doing things,’ says marketing manager

Gordon Maw. ’It is always about trying to find a different way, and

adding value for customers in a manner they can’t get anywhere

else.’



Being one of the first companies to offer a cheap-to-administer tracking

fund PEP, which shadows the FTSE index, was one reason for its early

success.



Another was the decision to staff the call centre with salaried

operators who do not receive bonuses or commission and are under no

pressure to sell hard.



’Buying financial services on the high street can be an intimidating

experience,’ says Maw. ’You are at a disadvantage: you’re on their

premises and they have the expertise.



’We believe that the telephone puts the customer in charge; they can

always put the phone down. What we’re all about is making it a

pleasurable experience.



’We’re not scripted and stale; we want to come across as friendly and

personal. We want a relationship.’



A GROWTH BUSINESS



Telemarketing overtook direct mail in 1995 as the biggest element in the

UK direct-marketing industry, according to a recent comprehensive review

of the sector, The Telebusiness Report.



UK expenditure on telemarketing now exceeds pounds 1.2bn - a figure

which is expected to double by 2005, although by then the rate of

expansion will be slowing.



The number of call centres in Europe quadrupled between 1994 and 1997,

reaching more than 36,000 last year. This compares with more than 90,000

in the US.



The report suggests that in two years the number of call-centre seats in

the UK will have risen from around 250,000 to 500,000. This will

maintain the UK’s 20% share of the European market.



Technology will also continue to advance. Speech recognition is tipped

as one of the key developments.



Computer telephony integration is forecast to bring big advances in

productivity, with the majority of call centres expecting to adopt it in

some form over the next two years.



The Telebusiness Report is published by Haymarket Management Reports,

priced pounds 450. For further information contact Morice Snell-Mendoza

(tel 0171 413 4412, fax 0171 413 4138), or visit the web site at

www.managementreports.haynet.com.



Teleperformance mystery shopper test How UK call centres perform

Sector                   Total   Answered   Overall     Overall   Total

                         calls        (%)  attitude  efficiency   marks

                     attempted                  (%)         (%)     (%)

Financial services         312       86.9      70.0        71.0   64.6

Other services             302       92.7      65.5        70.0   62.9

Automotive                 346       80.3      65.5        65.0   11.98

Mail order                 125       96.0      63.5        55.0   11.93

Insurance                  337       84.6      66.5        57.5   11.58

Retail                     109       91.7      60.5        50.0   11.53

High-tech                  204       84.8      61.0        62.0   11.44

Travel                     301       75.4      42.5        54.5    9.91

Consumer goods             194       72.7      42.0        45.5    8.44

Total                     2230       84.1      60.5        59.5   11.36



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