Europe Calling

TO JUDGE BY the way share prices for the sector are dropping, the boom in telemarketing in the United States is over. Whether this is the result of overoptimistic growth forecasts or a natural correction in a mature market depends on one’s point of view. Certainly sustaining 13 public stock offerings by telemarketing agencies in five years is asking a lot of investors.

But it does provide a stark contrast to the valuation being put on this sector in Europe. For comparison, shares in Teleperformance-the main multinational teleservices rival to Sitel, traded on the Paris Stock Exchange-have doubled in value over the last six months and tripled in the last year.

Europe still has a long way to go before call volumes are close to those experienced in America, either inbound or outbound. That means there is still tremendous growth potential. In addition, there are cultural factors that make the use of teleservices more quality-based than volume-driven.

“The big problem with the U.S. industry over the last five years is that it is very much outbound-oriented and product-led. It revolves around massive campaigns where quality is not the be-all and end-all,” says Neil Perring, managing director of BPS Teleperformance in the United Kingdom.

His agency carries out 10 million call campaigns in the United States, and has even done 50 million outbound call projects for one client.

“As long as you have got your target calls per hour, what they were like doesn’t matter to the client,” he says.

This is in sharp contrast to the United Kingdom. On average, a consumer will receive just six outbound calls per year, of which three will be hard sells and three more marketing-oriented.

The smaller size of markets in Europe is a critical factor in setting the tone for teleservices calls. If the entire population of a country is just 50 million, it’s impossible to undertake massive outbound volumes without improving the quality-if you fail with even just 10% of calls, there are not another 5 million prospects to replace them.

Another driving factor is the way global brands are seeking to roll out the same teleservices in every country where they are active. Sitel Europe’s senior vice president for marketing Robert Scott-Moncrieff says the key difference is between “multicountry organizations with offices in each country that have relative autonomy and multinational companies that tend to try and set the same standards wherever they are.”

Sitel has recently been appointed by Philips to handle its inbound consumer calls worldwide for the next five years. “It is part of the demand to recentralize the process by which it delivers brand messages. It is about consolidating all the procedures at the core with common guidelines for recruitment, training, infrastructure, even scripting,” he says.

For a global teleservices group like Sitel, this is where the major opportunities lie, especially in developing markets. And it is only the international service providers that can offer consistent quality.

The best insight into the quality of inbound call handling around the world comes from the Teleperformance Grand Prix telephone services awards. Every year Teleperformance makes over 50,000 calls to more than 2,000 companies in Europe, North and South America and the Asia/Pacific region. In each country, 20 “mystery shopper” calls are made to at least 100 organizations. Calls are graded between 0 and 2 on 10 criteria, ranging from time to answer through quality of listening to overall attitude and efficiency, allowing a maximum score of 20.

Across all countries, the average score achieved was 11.3. Although the United Kingdom scored 11.4, it was still beaten by the United States, which averaged 11.9. But the best proof of the equation that small markets equal better quality can be seen in the averages of the top five, in descending order: Canada (13.6), Switzerland (13.4), Belgium (12.9), Austria (12.6) and Norway (12.1).

Perring notes that “you have to be careful when making cross-country comparisons. In each country consumers will have their own criteria on what makes a good call.”

Multinational brands can leverage these variations to their advantage, however, even while maintaining consistency. Teleperformance judged American Express the best company worldwide for the quality of its teleservices, while DHL was honored for outstanding consistency over the past decade of the Grand Prix.

Laurent Dorpe, general manager for financial services at American Express Bank France, says the award was very important to a company oriented around service and customers. “For each line of business we have a standard. Quality is a standard, but in each business there are targets for lost call rates, the number of rings before answering, etc.”

He is especially pleased that in France, the personal financial services division won the Teleperformance Gold Award for financial teleservices.

Local market conditions are often reflected in both its advertising and call handling. The launch of Amex’s Optima card, for example, has been coordinated internationally out of OgilvyOne New York, but is tailored to local markets. The campaign has been led by the corporate TV ad, adapted for each country.

Local press advertisements for the United Kingdom have been designed by OgilvyOne London. These ranged from glossy color ads to run in consumer magazines to black-and-white versions imitating recruitment ads.

Certainly the brand values of Richard Branson’s Virgin Direct financial services operation are on the one hand distinctly British (quirky, anti-authoritarian) and also very un-British (informal and chatty).

Given the Diamond Award for best U.K. teleservices operation, ensuring these brand values are part of the experience of making a call has been critical to the company’s marketing strategy.

“We have basic building blocks that are fundamental to Virgin in terms of the way we communicate with customers. That ranges from the number of phone rings to how helpful we need to be,” says marketing manager Gordon Maw. For a company selling complicated products like pensions and investments, the first 10 seconds of a call will be vital, since prospects will be calling a short list of candidate companies.

Getting it right has meant thinking carefully about every aspect of teleservice, from recruitment to training. Virgin Direct aims for a mix of call center employees who range from college graduates to mothers returning to work.

The intensive training program puts as much emphasis on Virgin’s values as on compliance with financial regulations. Maw notes that a consequence of continual evaluation is that “we are becoming more conversational in our calls. A lot of companies use tight scripting, but that sounds very false.”

Significantly, operators do not work under strict call duration limits-if a caller needs 10 minutes to resolve a query, the operator won’t push to wrap up the call quickly. That’s a long way from the generic telemarketing rules derived from the United States.

With global service providers able to push effective telemarketing practices from one country to another-including back across the Atlantic-real changes are taking place.

Scott-Moncrieff summarizes it this way: “Telemarketing is the old-fashioned way-teleservices is where it’s going.”