Tuesday, June 3, 2008

Speed to marketer

When I first incorporated Inticiti, I was astounded at the speed with which direct marketers contacted me. I incorporated on a Thursday. The following Tuesday I received my first piece of junk mail addressed to the business.

Certainly the process for sending that piece of junk mail was automated and not specific to me. And I did what most people would do – into the recycling bin it went.

The marketers send so much mail because they believe based on their research that each letter they send is worth more in future revenue than the cost of its printing and mailing. What happens if we become a customer of one of those companies and need to call their help desk? General customer experience notes that wait times are excessive (or “feel” excessive) and staff are often not as helpful as we would like (or we “feel” that to be the case). It sometimes seems as if companies believe that each customer served is worth less in future revenue than the cost incurred to serve them.

The second complaint (helpfulness) is more difficult to improve since it requires not only good automated menus and scripts for call center agents but also a degree of familiarity and longevity at the call center, where employee turnover can be 100% per year. The first complaint (wait time) could be easily addressed: simply add more agents. Using knowledge of call busy hours and queuing theory we know that adding a handful of agents to a large call center can dramatically reduce customer wait time. And agents in general are pretty cheap.

So why do we ever need to wait on the phone for the help desk? I think it is mostly a matter of context. Companies traditionally viewed their facility and support staff as costs rather than as potential sources of revenue. Only recently are companies thinking about call centers not as reactive cost centers, but as proactive sources of additional revenue.

Like call centers, direct marketers do not consider costs that exist outside of their business model. The most important one of those externalities to me is the time that I have to take each day identifying and discarding junk mail. Further, there is the municipal cost of disposing discarded mail. And do I throw it away or recycle it? Further to that is a possible increased exposure to identity theft made possible by each additional letter with my name and address on it. Taking all of this into account, perhaps the social costs of junk mail (or call wait time) are greater than the economic benefits that accrue to the marketing organizations and their corporate clients.

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