Are you prepared to service the DRTV market?

You've heard the direct response TV (DRTV) market could be a lucrative venture for your service agency and you're ready to take the plunge. Or are you? The key to success is knowing what to expect and having the correct resources in place.

Today's consumer is bombarded every day, night, week and month with thousands of impressions of the miracle mop, Elvis videos, CDs and the wonder widget that they just have to have or their lives will never be the same. If you don't believe me, subject yourself to an hour or two of late-night TV and I guarantee you will encounter a message that says, "To order, credit card customers call 1-800-INSTANT response."

Ah yes, the commercial: 30 seconds, 60 seconds, 30 minutes. (Hopefully it will never exceed 30 minutes. After all, who in their right mind would subject himself/herself to more than 30 minutes of straight commercials?) The truth is, hundreds of thousands of people are motivated to make purchases through the miracle of television advertising. Do the products they buy work? "Absolutely, and they come with a 30-day money-back guarantee." At least that's what your operators had better say when they are asked.

DRTV promotions have run the gamut from the good, the bad to the ugly, with little rhyme or reason for their success or failure. Sure, you can try to justify, quantify and qualify why a particular DRTV promotion was successful, but it is most often not easily explained. If it were, you'd always know what would work and what wouldn't, but that's not reality.

Erratic Response

When someone asks me what I think their DRTV response will be, I tell them my crystal ball is currently in the shop under repair, so their guess is as good as mine.

Let's look at some examples of DRTV advertising results. In a local market of approximately 500,000 people, I've seen call volumes in response to a 30- or 60-second spot draw only 8 to 10 callers. On the other hand, there have been extraordinarily successful programs that have delivered as many as 50 to 60 responses, but they have been few and far between. That doesn't mean that in a market of 1 to 5 million there is a linear relationship and you should expect 20 to 100 calls. In fact, the relationship can be quite the opposite. Furthermore, if you evaluate the response on a cable, national, or satellite network, the results are as unpredictable as the weather. The bad news is by the time you figure out the calling patterns, there are changes to the airtime, the commercial, the pricing, the frequency, the product, and who knows what else.

What am I saying? When your call center moves into servicing the DRTV market, you had better be prepared to expect the unexpected. Crucial questions, such as the following, need to be addressed. Do you have a sufficient number of trunks and operators? How many calls might be abandoned? How will this affect other clients? Can you schedule extra staff for the first few airing dates? What if nobody calls? What if too many people call and can't get through? Will they call back? Will you lose the account? It's enough to make you go gray, lose your hair, and your marbles.

The secret is never to take on more than you can handle. If you always deliver the same level of good service, your customers and your customers' customers will love you. So take little bites. Try a small market, then a larger market, then a larger market still. The problem, as I see it, is the conundrum that faces many small- to medium-sized call center service agencies. They are too big to be small and too small to be big.

When you staff 30 to 50 seats and you have a mixed account client base, you are ready to try DRTV. When you have hundreds of seats, dependent on your mix of clients, you still may not be in a better position to take on DRTV. But the odds are in your favor with a larger center. It all boils down to operator availability.

The Pitfalls Of Staffing

If you haven't been discouraged by now, here's the final straw. Most DRTV customers pay for their advertising on a per-inquiry basis. That means that the station gets a percentage of the sale as a commission on the sale of the product, or per inquiry. Sounds pretty good so far, but the bad news is you may never know when the commercials are going to run. It could be 10 a.m., 10 p.m. or 3 a.m., when most of the world is sleeping--except for your call center operators.

The Successes

For every successful DRTV product there are probably 50 that fail. When you have excess capacity for more calls most of the time, and you can expand your DRTV clients to the point where there are dozens or hundreds of offers simultaneously active, there is a good chance DRTV will fit nicely into your service mix. The odds are in your favor of local channels advertising competitive products at the same time back to back. The odds are also low of national ads and local ads interfering with each other. When your DRTV accounts are your primary source of calls, these odds could start to work against you. Hopefully by then you will have sorted out your staff requirements and it won't be an issue.

There are many service agencies that serve the DRTV market, but only a few have the necessary thousands of operators to draw on for the largest of large projects. Many call centers have joined associations or formed alliances with other centers for call overflow opportunities. A smaller center needs a safety net for the times when they'll be blown out of the water with a surprisingly successful promotion. Don't be hesitant to share the risk with another center you trust with a good reputation for delivering quality service. Think of them as your ally and never the enemy. Don't sell your center short, but never overextend your resources. You can lose the business as fast as you gained it, along with your reputation.

Infomercials

Infomercials have been on the rise. There is even an association called NIMA (National Infomercial Marketing Association) catering to the DRTV industry through trade shows/conventions that attempt to bring the players together from the supplier and advertiser sides. The Canadian market has been exposed to the infomercial trend through cross-border stations and is now being exposed to Canadian stations running infomercials, as well as the proposed 24-hour infomercial channels. The DRTV market continues to grow, driven by market trends and new products. But most of all, it is successful because consumers are willing to part with some of their disposable income for the products they see on TV and absolutely have to have.

Essential Technologies

The use of an ACD (automatic call distribution) system is an absolute must to manage DRTV call volume. A minimum of 10 to 20 trunks are required to handle a low-to medium-volume of calls in a timely fashion.

Today's data collection software allows operators to capture the necessary ingredients of an order in 60 to 90 seconds. The software/screens should put operators in a position to discuss in this time frame all aspects of the order, including pricing, taxes, shipping and handling, expected delivery, a description of the product, how it works and an 800 number for customer service matters.

Ideally, you should have a minimum of 15 to 20 percent more trunks than you have operators to keep the call traffic flow moving and eliminate as many busy signals as possible. An IVR (interactive voice response) system or some type of electronic messaging device is helpful to deliver product information such as pricing and an operating description, as well as a mailing address. This allows callers to access the information they require prior to, or rather than, speaking to an operator. The use of a recorded message that keeps callers in the queue while they are waiting is also very useful. It can deliver valuable information and suggest other sales opportunities, such as an upsell or cross-sell. Of course, there is never a substitute for a live operator at any time, but the reality in the DRTV market is you may always face the possibility of having either too many or too few operators scheduled to handle the call volume. The key is to be prepared. And by all means, use call detail reporting to give you a yardstick to measure how effectively you have managed the call processing through your center. Look at a comparison of your telephone service factor, abandoned call rate, average wait time, and all trunk busy status. If your statistics show 90 percent of calls were answered prior to three rings by an operator, less than 3 percent resulted in a hang up, and all trunks were busy for no more than 30 seconds, you will have passed the test with flying colors and delivered first class service to your customers and your customers' customers.

Sheldon Stoller is the vice president of sales and marketing of Integrated Messaging Inc. (IMI). The founders of IMI, Merrill Shulman and Sheldon Stoller, have been involved in the telephone answering industry since 1974. In 1989, IMI embarked on a new venture serving the direct response television market and other areas of the direct marketing industry. IMI operates q 24-hour, 7-day exclusively inbound 800 call processing center, located in Winnipeg, Manitoba, Canada. IMI serves clients in Canada, the United States, England and Australia.

Copyright Technology Marketing Corporation Nov 1995
Provided by ProQuest Information and Learning Company. All rights Reserved