Farming Out Phones

Corral West opts to outsource its teleservices rather than upgrade One of Corral West Ranchwear Inc.’s first moves after buying its way into the catalog business was to close its outdated call center and delegate its teleservices functions.

The Cheyenne, WY-based Western apparel company saw outsourcing as its best option, since it lacked prior teleservices experience. By shutting down its call center, Corral West freed itself to develop new customer contact strategies for its catalog, Web site and 90 retail stores.

Corral West determined the phone system was too old and impractical to adapt or upgrade. “It’s wasn’t state-of-the-art for where we’re anticipating going with e-commerce,” says company vice president Steve Farkas.

The teleservices equipment it inherited in Denver wasn’t scalable, meaning Corral West was unable to add new components or significantly increase inbound call capacity. On top of that, Corral West wanted to move the catalog order-taking operation closer to Cheyenne, but not the additional investment expenses.

“Another reason for outsourcing,” says Farkas, “is that we wanted to provide customers on the phone with the same level of service they would receive when they walk into one of our stores.”

For the interim, Corral West hired Williston, ND-based Advantage Line Telemarketing Inc. to manage inbound calls for the Miller Stockman catalog operations it acquired from Miller International in June 1999. Advantage Line answered catalog calls during off-hours on weekends and nighttime for the former owner.

“It was a cost and management decision for Corral West and about getting access to the right equipment,” says Advantage Line president/CFO Mark Hardy.

Advantage Line added a phone line linking its customer interaction center in Billings, MT, directly to Corral West’s fulfillment center, providing its phone agents with on-screen access to inventory and other data and enabling both companies to streamline the transmission of database information.

By linking some of its computer systems with Advantage Line, Corral West eliminated a cumbersome method of batching customer data for distribution once daily. The new data link enables phone agents to provide customers with more information about their order status and shipment tracking. Phone agents can, for example, tell if someone previously called an hour ago and enter notes in the records, Hardy says.

More changes in its customer contact management are anticipated, as Corral West has Advantage Line analyzing the types of inbound calls it receives and the questions consumers ask when they contact Corral West for any other reasons besides placing orders.

“We hope as we establish a greater Internet presence to evaluate how the 800 number is being used above and beyond order-taking,” Farkas says. “Advantage is tracking to find out the type of questions and customer service calls it receives to get a more accurate picture of the kind of information customers are seeking.”

Farkas says the new Corral West/Miller Stockman catalog and Web site generate 20,000 inbound calls per month, a volume the company anticipates will increase as the Web tests it began in August are expanded. Annual catalog circulation is estimated to be 4.8 million copies.

Each Web page at the company’s site (www.corralwest.com) includes the same 800 number Corral West uses for its catalog. It answers its own customer service calls in-house along with the growing volume of inbound e-mail it receives from customers.

Corral West is monitoring how its new online marketing partner’s Web site (www.TheWest.com) handles online text chats with its customers. “It has a live help feature and we’re studying it,” Farkas says.

At this point, catalog and Web sales performance are not meeting sales expectations, but the company has yet to embark on an aggressive marketing campaign for upselling or cross-selling products on the phone or for promoting Web site traffic.

“We expect to turn around our catalog and e-commerce in 2001,” Farkas says. “We’re entertaining all options as long as they’re consistent with our business and strategy for the catalog and e-commerce.”

Nikken teleconferencing aids catalog, direct selling strategies Japanese health products marketer Nikken Inc. is using inbound teleconferencing calls both to boost catalog phone orders and cultivate independent product distributors for direct selling.

Through its U.S. headquarters in Irvine, CA, Nikken schedules more than 50 teleconferences daily with one of its teleservices agencies handling such calls. The company reported $600 million in North American sales in 1999.

Tightly formatted hour-long conference calls typically include 30 minutes of product testimonials followed by another half-hour segment for training or recruiting new field sales reps. Nikken encourages its most enthusiastic prospects and customers to become independent distributors and promote products to their acquaintances, friends and families.

Teleconferencing participants are given toll-free numbers and passwords for access to scheduled calls. The number of people participating varies from as few as five to upwards of 250 people per call.

Independent Nikken distributors typically arrange verbal commitments with prospects and customers ahead of time to participate, encouraging them to listen in and ask questions about featured products.

People who have agreed to participate receive an outbound call reminding them of their conference call commitment, and that call is transferred to the conference call. “We know it works better than just giving someone the number and hoping they’ll call, because they may forget,” says Nikken distributor Dave Mahoney.

Scripts for conference calls tend to vary depending on the personality of the distributor acting as the call coordinator.