Magazine article Marketing

New States of Co-Operation

Magazine article Marketing

New States of Co-Operation

Article excerpt

The merger of the UK's Mitre Group and US company Sitel has focused attention on the likelihood of US telemarketing techniques crossing the Atlantic

The Yanks are coming! Two announcements in the past month have signalled a major shake-up in the UK telemarketing industry and there is plenty of evidence that it won't end there. The US telemarketing industry has set its sights on global expansion and the UK provides an obvious route into Europe.

Besides a growth in international telemarketing networks, however, what are we likely to see? My forecast would be for more takeovers or mergers, as well as for less-formal working alliances between British, Continental and US bureaus. More major call centres will be built - housing up to 500 operators each - and the greater American experience of customer care lines and out-sourced call centres will accelerate their acceptance on this side of the Atlantic.

The Americans are also likely to be keener than their UK counterparts to push the idea of outbound calls to consumers - technique which tends to be associated here with the sort of aggressive tactics followed by double-glazing firms.

The first of last month's two significant announcements was the confirmation of the merger between the US telemarketing company Sitel and the Mitre Group, the holding company behind two of the UK's best known bureaus, Merit Direct and The Decisions Group.

The intention to merge the two operations had been well-flagged, but the terms still stunned the industry. The deal valued Mitre at [pounds]208m, putting it in the same league as the highly-successful and high-profile advertising agency Abbott Mead Vickers. In the process, it has made some individual shareholders seriously wealthy - Mitre chairman Henk Kruithof, for example, becomes the largest single shareholder in Sitel.

And, of course, if the Americans are busy waving such fat cheque books, you have to wonder who else will prove to be more than willing to give up their independence.

The second bit of news, albeit on a different scale, was no less significant. Matrixx Marketing, a subsidiary of Cincinnati Bell, has an established call centre in Newcastle-on-Tyne, but has been keeping a low profile. Now it has come out with a plan to network its Newcastle site with three of its centres in the US. Handling DRTV campaigns here, it will be able to divert automatically any overflow calls to a total of up to 1300 US operators.

According to Matrixx's UK managing director Don Anderson, the service will go live at the end of this month. It will provide an alternative solution to the problem of dealing with peak response levels to direct-response television advertisements. At the moment, many campaigns are run on minority channels and out-of-peak viewing hours, in a bid to match call volumes to bureau capacity.

Of course, British bureaus do collaborate on campaigns, but only a few can offer large numbers of operators. The other option is automated call handling - fine for some campaigns, but not for all.

Sitel and Matrixx are not the only US telemarketing specialists eyeing the UK and Continental markets. Another company to watch is Teletech, which like Sitel is something of a glamour stock on the Nasdaq exchange. The company already has a foothold here through Access 24 in Reigate in Surrey, which is a joint venture with health insurer PPP.

But Access 24 is a specialist service, and is positioned at the top end of the spectrum. Teletech's area of expertise in the US, however, is large-scale, long-term customer-care programmes, where it might have as many as 1000 operators working on one account. It claims to be the largest US provider of inbound services, with its clients including the US postal services and parcel delivery company UPS.

Teletech has now won its first major UK client in its own right, providing customer support for an on-line service supplier. …

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