The phone, as British Airways discovered last month, is particularly effective when you have to grovel. With its reputation at stake after the disruption caused by unofficial strike action, BA identified one group of people - its 8000 Premier and Gold Card Executive Club members - who it couldn't afford to alienate.
The answer was a personal call to each customer to apologise. While BA's 9000 Silver and Blue Card members received a letter, the company recognised that the best way of building bridges with its most valuable customers was over the phone.
But it's not just in a crisis situation that the phone can come into its own. The travel industry is recognising more and more that the contact centre is a powerful means of meeting a whole range of business objectives.
In July this year Peter Rothwell, Northern Europe chief executive for the UK's biggest holiday company, TUI, reported that that the firm now has as many people answering phones as it has behind desks in shops. He predicted that the number of TUI retail outlets (which include the Thomson Holidays and Lunn Poly brands) would gradually decrease as more customers book via contact centres and the web.
While contact centres represent a low-cost alternative to the high-street travel agent, the fact remains that they are still a cost, and are being squeezed in today's economic climate.
The travel industry is facing one of its toughest periods for more than a decade. Travel agents have reported a bookings slump of about 25% and the Iraq war alone was predicted to have cost Britain's inbound tourism industry between £1.5bn and £2bn, according to the Tourism Industry Emergency Response Group.
Yet in these difficult times contact centres have a vital role. Loyalty can be harnessed by providing an excellent service; brands can differentiate themselves in a homogeneous and price-driven sector; and callers can be converted into buyers.
If any part of a business should be protected from the axe of the cost-cutters, it's the contact centre; but this is rarely the case. It is an area that has typically been characterised by under-investment, according to Andrew Johnson, chief executive of Dataforce Group, which works with travel brands including First Choice and Bourne Leisure Group.
"Companies often spend £15 to £20 on awareness campaigns to generate one brochure request, yet will look at how they can process that request for under £1," say Rogers. "You have just spent that sort of money persuading them to phone for a brochure, so why do you want to get them off the phone so quickly? Why not gather profiling information by asking a few more questions or establish whether they are ready to book a holiday and put them straight through to a booking adviser?"
The answer is that this approach requires more time on the phone. And an agent's time is money that could be spent taking even more calls.
"In a call centre environment, time and cost are the same thing," says Ken Carlon, managing director of teleservices management company Optima, part of the WWAV Rapp Collins Media Group. "To create greater revenue from a call, you have to spend more time on it, but that creates more cost," he adds.
The 'time is cost' approach fails to take into account the long-term financial rewards of taking the time to gather data on holiday preferences for future targeting, for example, or of ensuring that all the caller's questions are answered, however detailed and lengthy they may be.
Rather than being viewed as a necessary but burdensome cost, contact centres should be viewed as profit generators. And fortunately some travel companies are starting to wake up to a more sophisticated long-term approach.
One such company is Thomas Cook, which is starting to see the benefits of its new contact centre strategy (case study, page 25) and is talking about its experiences at this year's Call Centre Expo conference.
Thomas Cook has seen a clear increase in direct bookings in recent years, according to Neale Vickery, head of customer strategy at Thomas Cook. And these direct bookings come from a certain type of holiday buyer.
"What we have found is that there are some consumers for whom shops are vital and they would never think of going to other channels," says Vickery. "The customers who are happy to go direct tend to be more affluent, more confident travellers generally, and tend to be people who travel more often. These are valuable customers, and that makes the direct channels very important. We need to have the right people answering the calls and their product knowledge has to be of the highest standard."
Getting the right staff to respond to the right calls to deliver against specific business objectives is something that Virgin Atlantic has also tackled in the past year, with some success.
According to Virgin Atlantic head of contact centres Darren Seymour, it has been a slow, consultative process with the aim of "bringing us in line with what the individual requires".
"The only way you can really succeed and expect to grow is through the quality of the service you provide," he says. "It's as clear-cut as that. It's simply the strongest and most powerful thing in your armoury."
Sales versus service
The process of change at Virgin Atlantic began when sales and service consultancy Blue Sky was brought in to review the airline's staff bonus schemes in its Crawley contact centre.
The company hoped to drive incremental sales of 20% by shaking up its staff reward scheme. But Blue Sky realised there were bigger issues to be addressed.
Chief among these, says Blue Sky managing partner Marc Jantzen, was the fact that the sales and service functions were combined. "People were being hired to fulfil both a sales and service role, when in fact they are different animals," he says.
All 300-odd staff were invited to volunteer for either a sales or a service position and were then assessed accordingly. "Because people were involved in this process and given a choice, it was empowering," adds Jantzen.
The last thing Virgin Atlantic wanted to cultivate was a hard-nosed sales approach that was at odds with its brand. But it did recognise that staff working on the sales side required different coaching and support to their service counterparts.
Training became part of the employees' day-to-day lives, and was tailored to their exact job, with the managers heavily involved. The result was a 300% increase in the sales conversion rate and a customer letters board - which had previously featured just one letter of complaint - covered with glowing letters.
"People invest millions of pounds in customer relationship management technology with questionable prospects of returns. But if you get the right people in place and give them the right skills, you can see an overnight return on investment," says Jantzen.
This is the sort of language that will make a client marketer's ears prick up - a quick return from a relatively low investment. It's also a far cry from some of the technology solutions that are on the market, which often carry a hefty price tag. Caller line identity (CLI), for example, enables incoming calls to be recognised and the caller identified. Computer telephony integration (CTI) gives the agent instant access to information on the caller's history with the company - when they last travelled, where they travelled to, any problems they had encountered.
Holding back investment
But the current economic climate means that even though the likes of CTI would undoubtedly enhance the caller experience, and ultimately lead to a higher propensity to buy, it is unlikely to even get off the starting blocks. "From a technology point of view the travel sector could go further," says Jantzen. "But they're not investing at the moment."
Fortunately, not all new initiatives require a major financial commitment.
Vacation Rental Group, which provides villa and cottage holidays in Europe, works with Dataforce Group on its brochure request activity.
Brochures are mailed first class on the day they are requested, and Dataforce also sends the customer an e-mail thanking them for the enquiry, confirming the brochure is in the post. The e-mail includes a link to its web site, which, says Johnson, has significantly increased its booking rates.
"Requests handling and brochure fulfilment are generally seen as back-end functions that don't receive enough attention from senior marketing managers," he says. "But if you take this part of the business seriously you do see the rewards."
Clients will invest, he argues, if they get results. And that's why suppliers in this market invariably work to set key performance indicators.
This could be the percentage of overall calls that are converted to sales, the length of time it takes to answer the phone or the percentage of brochure requests that are converted to bookings.
Connections+ works with low-cost airline Jet 2, which launched in the North of England last year and has set itself a target of answering 80% of calls in 15 seconds.
Jet 2 also has a conversion rate target, but, says head of corporate services at Connections+ Paul Magee, the relationship would flounder if there was a 'them and us' philosophy.
"We are totally immersed in Jet's brand. Its staff are fully involved in the training and all our agents have flown with Jet within three months of joining, so they are able to talk to customers with the benefit of their own experience," says Magee. "We are more like a virtual call centre on their behalf."
Of course, not all brands put such a high value on their customers' contact centre experience. Only 5% of easyJet bookings are conducted over the telephone. And this is a figure it expects to shrink over time.
The company has recently closed down the Stansted contact centre it inherited with the purchase of Go, and there are only 150 desks at its Luton contact centre. This number is likely to drop further now that customers can change their flight details online, rather than over the telephone.
"It's all about taking cost out of the company," says head of corporate affairs Toby Nichol. "In due course the major airlines will follow. People have no loyalty. The only loyalty they have is to their bank balance."
It is a philosophy that fits neatly with the group's broad no-frills model. But for those companies operating at the premium end, customer loyalty remains the Holy Grail, and there is no escaping the importance of a call well-handled.
THOMAS COOK IMPROVES EFFICIENCY
Thomas Cook has four call centres employing about 1000 sales and after-sales staff and receiving between 70,000 and 80,000 calls a week.
With the number of direct bookings rising, the company recognised that this part of its business had to work efficiently, but deliver a high customer service.
Two-and-a-half years ago the company appointed its first director of call centres, with responsibility for all four sites, and a head of capacity and yield, Simon Priestly, responsible for areas such as workforce management, resource planning and technology investment.
One of Priestly's first tasks was to establish the skills that staff performing different functions needed to exhibit.
"In a shop, a member of staff has to be a jack of all trades available to handle whatever may come up," he says.
"But in a call centre you don't have that pressure. Customers can be sifted according to what they're after and routed to someone with that area of expertise."
Thomas Cook has a number of niche products, from its round-the-world offer to cruising holidays and ski trips. In total, 25 different skills were identified, which fitted with the product range. Staff were trained accordingly.
"There are significant advantages with this approach," says Priestly. "It's a much more consultative sell, because we talk their language."
To facilitate this approach, every piece of marketing material, from posters to press advertising to direct mail, was tagged with a unique number so response could be tracked.
Thomas Cook uses between 600 and 700 different phone numbers across all its marketing to route calls to the correct agent and track response.
The company invested in workforce management software that enabled it to track all call data. "We know how many people call, on what day of the week and on what phone number.
"We can quickly pick up patterns, such as when people are likely to call after a direct-response TV campaign," says Priestly.
A second major investment gave Thomas Cook the ability to manage calls remotely before they are routed through to a particular agent.
This software sits above all four call centres and intelligently tracks which consultants are available and which have the right skills to handle the call. It not only ensures there is the shortest possible queuing time, but also means that more calls are handled more efficiently.
"For a given level of staffing we are handling more calls and we are selling more holidays," says Priestly. "We are consistently improving the sales conversion rate, simply because we are getting the right calls to the right person."
CALL CENTRE EXPO 2003
Date: September 16-17, 10am-5pm
Venue: NEC, Birmingham, Hall 9
Visitor profile: This event is for anyone who is involved in either outsourced or in-house contact centres, customer service centres or telemarketing activity. Visitors are likely to cover many departments within organisations from sales and marketing to customer service, customer relationship management, call centre management, IT support and human resources.
Exhibitor profile: More than 250 exhibitors are attending the event, covering the full spectrum of call and contact centre solutions. There are three main categories of exhibitors: 'People and Workplace', which focuses on agent recruitment, retention, training and workforce management; 'Business Process and Strategy', which will help visitors decide on the best customer contact strategy for their business; and 'Call and Contact Centre Technology', which covers the full range of hardware and software solutions. Exhibitors range from call centres such as Broadsystem, Contact 24, Merchants and MM Group to software companies including Noetica, QAS and Group 1 Software.
Conference: Last year about 450 delegates attended the Call Centre Expo Conference and the organisers are expecting a similar number this year. The programme is divided into three tracks, which are the same as the exhibitor groupings: People and Workplace, Business Process and Strategy, and Call and Contact Centre Technology. In each track there are eight sessions on each day of the conference and delegates can pick and choose from across the three tracks. This year's programme includes case studies from companies ranging from Abbey National and Thomas Cook Direct to Lincolnshire Police, Boden and egg.
Master classes: There are also four half-day interactive master class sessions taking place, which will be conducted in a workshop style. Speakers at the master classes include: Mike Havard, managing director of CM Insight; Chey Garland, chief executive of Garlands Call Centres; Becky Simpson, managing consultant at Improvement Solutions; and Wendy Hewson, head of end-user research at Hewson Consulting.
Full details of the conference programme and booking information can be found at the Call Centre Expo web site, www.callcentre-expo.com.
This article was first published on Marketing