Thanks in part to a prospect modeling initiative, in three years Birch Telecom has grown its teleservices sales to 20% of its business.
Birch is a Kansas City, MO-based local phone, long distance and internet provider that primarily targets small and medium sized businesses with one to 25 phone lines. Average revenue per customer per month is $200 for the company, which was founded in 1997.
Historically, field representatives have played the greatest role in the company’s sales efforts. In 2001, the company set forth to build an outbound telesales channel, as well as an inbound teleservices channel supported by direct mail. The goal, said Tom Edmondson, marketing director, was not only to add channel diversity but to lower the company’s cost of acquisition.
To do this, two models were created, said Matt Garrett, vice president, marketing, Aegis Communications Group. A top line revenue model and a response model were then overlaid on each other.
Having only short term vision is a mistake, said Garrett, noting that for a prospecting program to work, a marketer needs to be aware of their long term costs of acquisition and customer lifetime value.
Birch is working to extend its direct marketing efforts to the field channel, and has built a prospecting database for that purpose. The company is also working to better utilize information gathered in the sales process, and make the sales channels work together better, said Edmondson.
Edmondson noted that telereps with customer service, rather than sales, backgrounds have worked better for Birch. No scripts are used; instead, they are taught as much background about the company and its products as possible, so they can communicate with customers effectively.
The telecommunications firm currently has about 160,000 customers and 500,000 lines in 50 markets in 12 states, 95% of whom are businesses. Revenues for 2003 were $350 million, compared to $192 million in 2001.
Edmondson and Garrett spoke at the National Center for Database Marketing conference in San Francisco on Tuesday. NCDM runs through Wednesday at the Fairmont Hotel.
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