By: Mary Harvey
The
opportunity of having a subscriber on the phone when they've called you is too good to pass up,"
says David Obey, consumer marketing director at Conde Nast. "It's a golden moment. They're ready to
buy, they're in the mood, and they've been trained to have their credit-card numbers handy. It's a
completely different dynamic from when you're calling them."
For
most consumer magazine publishers, telemarketing has primarily been limited to renewals, and
billing and collection efforts. Inbound telemarketing, in particular, has long been "like
wallpaper"--an easily forgotten background source that produces limited volume, says Obey.
"Nobody's really thought to pay it too much attention."
But
the current circulation crisis is forcing consumer marketers to scrutinize and re-evaluate every
available source. In recent years, despite increasingly controversial privacy issues, publishers
have given outbound telemarketing more play. The use of third-party agents--the primary users of
outbound telemarketing--increased by 3 percentage points in 1998, according to "Capell's
Circulation Report," But publishers are not stopping there. Today, the unique opportunities that
inbound telemarketing offers are being reassessed as well. According to this year's
FOLIO:/Circulation Management consumer circulation trends survey, 54 percent of publishers report
that they are currently using inbound telemarketing as a source, compared with 41 percent in
1997--making it the fifth most widely used source today. Two years ago, it ranked ninth.
However,
generating and maximizing incoming calls has its challenges, and those "golden moments" do not
necessarily always yield golden results. "It's like picking up the rind after you've made orange
juice and trying to squeeze another couple of drops out," says Obey. "You think, 'There must be
something in there.'"
Increased
opportunity
The
use of toll-free numbers is apparently on the upswing. According to the North Hollywood,
California-based American Teleservices Association, approximately 80 million toll-free calls are
made daily through AT&T's network alone. In 1997, the last year for which figures are
available, a total of 27.6 billion toll-free calls were made nationwide. ATA also projects that in
1999, the call center industry will grow by 12 percent.
While
publishers acknowledge the increased use of toll-free numbers, most hardly expect them to be a
saving grace for circulation--mainly because the medium in which these numbers are most effective,
direct-response TV, is cost prohibitive for many.
Naturally,
there are exceptions. Emap Petersen plans its first use of a toll-free number on national
television to promote its recently launched, one-million-ratebase NFL Insider. In conjunction with
the NFL, Emap Petersen is currently running Sunday and Monday TV ads for newsstand promotion of the
new title but will switch to subscription ads once the title has a regular frequency. "It's an
opportunity we haven't investigated before," says Liberta Abbondante, Emap's vice president,
general manager, consumer marketing.
Cross-selling
and upselling
But,
more commonly, publishers are placing added emphasis on inbound call opportunities. "We're absolute
fans of 800-numbers," says Business Week consumer marketing director Joyce Swingle. Business Week,
which currently uses 800-numbers for both customer service and orders on such things as renewal
mailings, cover wraps and the Internet, is taking advantage of the moment a customer calls in by
attempting to sell additional products. In a cross-sell scenario, publishers might attempt to sell
the consumer a magazine or an ancillary product from the same publishing group. Upselling, on the
other hand, seeks primarily to retain a customer by extending a subscription.
"Historically,
we haven't done a lot of cross-selling and upselling in our customer-service operation, but we're
in the process of doing more now," says Swingle. Although Business Week is not necessarily
expecting customer service calls to generate a lot of business--and the company has no plans to
promote 800-numbers more aggressively at this time--Swingle expects to see order volumes increase
as a result of new in-house efforts involving improved scripting and training.
Others
are intentionally trying to increase call volume in order to create additional chances for a sale.
"The opportunity to upsell has increased as calls increase," says Emap Petersen's Abbondante. While
the company does not promote 800-numbers on insert cards or direct-mail pieces, it has began
including an 800-number on the masthead of all of its 160-plus titles--a move that's doubled its
incoming call volume, says Abbondante.
Emap
Petersen is currently working with its primary fulfillment bureau, Centrobe Inc., to roll out
upselling services that were tested in late 1998. "I think there's more opportunity with inbound
calls than outbound," Abbondante says.
The
call for more service
In
the last two years, publishers have become far more focused on the concept of "the customer
moment"--the instant a consumer contacts a publisher, says Centrobe's director of operations
Michele Wilson. "It's a great opportunity for an upsell. It's a captive audience--and people
calling in generally have a few minutes to spare."
Recently,
Centrobe began offering automated, easy-to-use upsell and cross-sell services with
publisher-directed scripting functions.
Conde
Nast's Obey, a current user of Centrobe's automated upsell services, says this type of opportunity
is long overdue. "I've always been astounded that this was not done years ago," says Obey, who's
also considering using Centrobe's new cross-sell services for his titles. "You get a lot of cash
with order. And you get [more] credit-card numbers than you can get by mail."
"Cross-selling
and upselling has always been on the radar screen," says Steve Strickman, president of Palm Coast
Data Inc., which began offering cross-selling earlier this year and upgraded its upselling
capabilities in the last 18 months. "It's obvious, and it's technically easy to do. But the
fulfillment service companies were never very good at it. The customer service reps were good at
providing service," Strickman adds, "but some people are uncomfortable selling. With scripting,
prompting and better training available, we've been able to do it a lot more effectively."
According
to Strickman, a cross-sale or upsale is successful in about 25 percent of all calls. But certain
restrictions to inbound telemarketing still apply. For instance, despite large incoming call
volumes (Centrobe currently processes about nine million calls annually, compared with 10 million
letters), most fulfillment houses' call-centers have limited weekday hours.
At
least one fulfillment house has addressed this problem. Kable Fulfillment Services, offers
round-the-clock, seven-days-a-week call center service, according to vice president of marketing
and sales Karly Becker.
None
of the handful of clients who have signed on for the new "24/7" service have objected to Kable's
premium for after-hours calls, says Becker. "We're getting one new client a week and no one has
said 'no' to the premium charge so far."
Only
three of Kable's clients are currently using outbound telemarketing, Becker says, but 382 of the
450 magazines Kable fulfills--or 85 percent--use Kable's inbound services. And order calls make up
45 percent of all incoming calls, while customer-service calls comprise 55 percent. At least half
of Kable's customers currently use toll-free numbers on direct-mail pieces, and at any given point,
20 percent of Kable's magazines are using cross-sell and upsell services, Becker notes.
Limits
on b-to-b use
B-to-b
publishers use fewer toll-free numbers for orders and customer service, and thus have less
telephone contact with customers. Therefore, inbound telemarketing is still a low-ranking source
for them. While some promote toll-free numbers on mastheads and in direct mail, many b-to-b
publishers, wanting to retain more written requests than telecommunications requests, promote
telephone response far less than their consumer counterparts do.
"Opportunities
do exist for cross-selling and upselling, and there are plenty of publishers trying to take
advantage of this, but not as much on the b-to-b side," says Nick Cavnar, vice president,
circulation, of Intertec Publishing. B-to-b service bureaus are not as equipped to take full
advantage of inbound calls. "Most of the controlled-circulation fulfillment houses don't have
sophisticated customer service systems as compared with the large, paid-circulation houses," Cavnar
explains.
Setup
costs are higher
Another
problem is the cost. "You can get a cost per call for inbound telemarketing that's cheaper than
outbound telemarketing, but you run into more setup costs in terms of training the staff," says
Cavnar, who explored using an inbound call center for customer service backup, but found upfront
costs to be too high. While Cavnar says Intertec may test featuring an 800-number prominently on
cover wraps and direct mail in the future, high costs now prevent such testing.
Barry
Green, vice president, director of circulation, Hearst Business Publishing, also ran into price
problems when testing inbound telemarketing for requalifying controlled requesters. "Price-wise, it
seemed I could probably do better with outbound telemarketing than with inbound," says
Green.
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