David Raab Article Archive

Inbound/Outbound Telemarketing
David M. Raab
DM News
October, 1994
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“Operators are standing by” may sound good to consumers, but it’s a frightening thought to the managers who must pay them. To avoid such waste, many businesses want to switch telemarketers between inbound and outbound calls automatically as demand fluctuates.

This is not easy. Inbound and outbound telemarketing have traditionally been as different as night and day. In fact, they were literally been split between the two: inbound was used for daytime tasks such as order-taking, customer service and technical support, while outbound telemarketers worked the night shift, reaching consumers at home. Even when companies did both, they usually had separate staffs with separate managers, often in physically separate call centers.

They also used different types of telephone hardware. Inbound operations ran on Automatic Call Distributors (ACDs), which are essentially automated switchboards with special features for routing calls to appropriate individuals or groups. Outbound telemarketers (especially in high volume consumer applications) used predictive dialers that could dial a list of phone numbers, screen out failed attempts (such as busy signals, non-working numbers and answering machines), and transfer only live calls to a human agent. These systems used sophisticated algorithms that monitored the progress of each call and determined how many calls to initiate in order to keep phone agents busy without putting people on hold when they picked up their phone.

Both ACDs and predictive dialers are telephone switches, able to place and receive calls. Both provide detailed statistics on activity through the telephone system–the number of calls placed, percentage of completions, call duration, average time to answer, number of people on hold, etc. Both can also exchange data with computer systems: say, getting the telephone number of the caller from the telephone system, looking that number up in a computer database, determining the right agent to answer the call, routing the call to that agent, and placing information about the caller on the agent’s screen. This type of connection, known as computer telephone integration (CTI), is particularly relevant to inbound applications such as customer service, where the company was likely to have existing files on the caller. It has generally required special (and expensive) hardware and software for each telephone switch, although some standards are now moving toward implementation. But I digress.

Despite the significant differences, the boundaries between inbound and outbound operations disciplines have become increasingly blurred. To provide better service at peak times, companies have increased inbound staff; they have found they can keep these people productive during off-peak hours with new types of outbound calls, particularly to existing customers and in business marketing. They have also found that certain technologies can actually transform inbound calls into outbound–for example, customers can ask technical questions via fax, e-mail or voice mail message and wait for a call-back, instead of speaking immediately with a live human being. Because these new outbound calls often require access to customer data, they are sometimes more like inbound applications than like traditionial outbound procedures.

This column looks at the approaches three telemarketing systems vendors have taken to the new environment. These vendors were chosen to represent a divergent set of backgrounds, but are by no means a complete list. Other major vendors–well worth exploring if you are looking for this type of solution–include Aspect (800-541-7799), Davox (508-952-0200), Intervoice (214-669-3988), Melita (404-446-7800) and Rockwell (708-960-8000), and no doubt several additional firms as well.

EIS International (203-351-4800) has its roots in traditional outbound telemarketing. Since its launch in 1988, the firm’s basic business has been predictive dialers. It now offers three separate lines: its own Call Processing System; OCM Gold, acquired from AT&T in 1991; and the System 7000, acquired last year when EIS merged with International Telesystems Corporation. Each line involves proprietary dialing hardware and uses different computer hardware, operating systems and databases.

To unify its businesses and take advantage of more current technologies, EIS is just launching a new line of Unix-based, client/server software called Centenium. The system will work with existing EIS predictive dialers and with other companies’ dialers or ACDs. Agent workstations are PCs with a graphical user interface under Windows or a traditional character-based interface.

Centenium provides a range of traditional outbound telemarketing software functions, including extracting data from external files, creating lists of records to be called, developing custom screens and scripts, scheduling callbacks for failed dialing attempts, and monitoring performance by campaign, agent, time period and other variables. These tools could be used to create complete applications for specific tasks such as collections or telephone sales. But, reflecting its outbound heritage, the system’s internal database is limited to a flat file of records to call, supplemented by a history of events (attempts, completions or future callbacks) related to those records.

This means that applications with requiring more than a flat-file data structure, such as customer service or technical support, would typically be run on software created outside of the system. In this situation, Centenium would be used primarily to control telephone operations, such as dialing, call distribution and callback rescheduling, that are not built into the application software or the telephone switch itself. Alternately, Centenium screens can access data directly in external systems. Installations can also be designed so the telephone agent sees Centenium and other systems simultaneously through separate “windows” on the screen.

For clients who want to blend inbound and outbound calling, Centenium includes a software product called SmartAgent. Introduced in 1993, SmartAgent achieves the integration by routing all calls–outbound as well as inbound–through the ACD. At the same time, it can monitor ACD statistics, such as the number of calls on hold and average time to answer, and automatically assign agents to inbound tasks when needed to maintain desired service levels.

The advantage of routing everything through the ACD is that all ACD features (such as call forwarding) are available for all calls, and that statistical reports taken from the ACD include a complete picture of all activities. Some earlier approaches to inbound/outbound integration essentially had the ACD transfer the overflow calls to the outbound system, after which the ACD lost track of the calls. This meant that reporting was incomplete, since the ACD was not aware, for example, of time the caller spent on hold within the outbound system. Reports from the two switches had to be combined and reconciled to get anything approaching a complete picture.

Centenium’s software can provide certain functions, such as predictive dialing algorithms, that let companies do sophisticated outbound telemarketing with an ACD alone. It can also support environments that are primarily inbound, providing the computer-telephone integration needed to inform a software application of the number a customer dialed or is calling from. However, again reflecting its outbound roots, the system relies primarily on the ACD itself to handle functions such as determining the flow of inbound calls and integrating automated solutions such as interactive voice response and fax-back options.

Pricing of Centenium is based on the number of users and specific software applications (collections, outbound sales, etc.) that the customer purchases. Prices (for software only) range from $25,000 plus $3,500 per seat, up to $55,000 plus $6,000 per seat.

SRX (800-905-4779) comes from an inbound telemarketing perspective. A manufacturer of PBX systems for small to mid-size businesses (20-70 stations), the company is now launching a new line called OmniWorks that will combine traditional ACD functions with outbound dialing, computer-telephone integration, and automated options such as voice response, messaging and fax-back. Official release is scheduled for November.

OmniWorks runs on custom hardware built around a standard 486 PC chip and running the Sun Solaris operating system (a version of Unix). The system supervisor uses a Windows PC workstation with a graphical interface for viewing real-time performance statistics and setting up call handling procedures.

But there are not computer terminals for the phone agents themselves. Instead, they work off special telephone sets with a four-line display screen that can show critical information (such as a caller’s name and information about the call) and prompt for inputs.

As the absence of computer workstations suggests, OmniWorks does not include sophisticated computer software applications. In fact, the system does not even build a file of records to be called. Instead, it relies on external software applications to store the data, drive the telemarketers’ computer screens, and feed it records to be called. SRX is working with TeleSystems Marketing (703-385-1212), a predictive dialing equipment and software vendor, to integrate TSM’s products with the OmniWorks line. TSM itself runs on an OS/2 PC. When the integration is complete, some time in 1995, all inbound and outbound calls will pass through the OmniWorks ACD.

Even without external software, OmniWorks can accept a list of calls, dial them, listen for completions, reschedule the incomplete calls and pass live answers to an operator–functions which are not yet common in ACD systems. The system stores the results of each attempt in a standard relational database (Oracle), which can accessed for reports.

But OmniWorks’ real strength is inbound processing. The system includes its own functions for voice mail, callback queues, prerecorded messages, interactive voice response (“enter 1 for sales, 2 for customer service, 3 for accounting”, etc.), and fax-on-demand. This means that a single graphical interface can define call routing schemes that combine several functions. For example, an OmniWorks caller might be greeted with a menu of options that include leaving a voice mail message, receiving fax information, hearing prerecorded messages, or waiting for an operator. The menu might vary based on the number of people already on hold, the caller’s phone number, the time of day, or information about the caller that the system looked up in an external computer database. Subsequent events can also vary based on fixed rules, current conditions, the history of a particular call, or information retrieved from an external computer.

In addition to looking up customer information in an external database, OmniWorks can store a table of information associated with up to 1,000 customer phone numbers. The company believes that clients with databases larger than 1,000 are likely to be storing the data in an external application in any event.

OmniWorks pricing is based on the number of users and features. A system for ten to fifteen users would cost about $100,000, with all hardware including the agent telephone sets. The cost per user would be about $5,000 for a 50 seat installation. Computer-telephone integration might add $500 per seat, and full predictive dialing could add $1,500 per seat. The system can support up to 96 stations.

NPRI (800-526-1984) started in 1981 as a software developer, specializing in marketing database systems. The firm then moved into call center solutions, and later added hardware to support predictive dialing. The firm’s products have traditionally run on Digital Equipment Corporation’s VAX computers, but this month NPRI will officially release a new client/server system. This product (unnamed as I write this) is written in Gupta’s SQLWindows development system, which allows its server to be any common hardware, including PC, Unix, AS/400, DEC and IBM mainframe, and to support most standard relational databases. The agent workstations will be Windows PCs. NPRI reports that the graphical Windows interface is popular with end-users, but had to be combined with enough structure to ensure that agent productivity did not suffer.

Instead of a stand-alone predictive dialing switch, NPRI’s hardware consists of boards that add key predictive dialing functions–in particular, the ability to monitor the progress of calls as they are connected–to ACD systems from other vendors. The firm has adapted its boards to work with the nearly every major switch.

Reliance on the existing ACD has made it relatively easy for NPRI to integrate inbound and outbound capabilities, since calls were never passed from one switch to another. But it also means that NPRI’s software is not in control of ACD and other functions such as interactive voice response, hold queue monitoring, and fax-back services. As a result, there is no single place to define an inbound call processing flow that uses all these functions. Instead, portions of the flow must be set up separately in each system, and control must pass to each system as it is activated. The systems can coordinate with each other by passing data back and forth, but this can still be cumbersome.

NPRI does provide a very powerful set of telemarketing software applications. These can have complex relational databases that are the primary marketing system of an enterprise, or they can be simpler files to hold call lists downloaded from other systems. Clients can buy off-the-shelf packages for both inbound and outbound applications, including collections, customer service, account management, and telemarketing. Most clients choose to customize these packages further, either doing the work themselves or hiring NPRI consultants. To help with customization, NPRI provides screen builders, data extraction tools, report writing capabilities, and specific telephone-related functions so that users do not have to create their own.

NPRI systems can be integrated with other corporate databases in several ways. External data can be copied into NPRI system files; users can simultaneously be logged into the other systems directly; or an NPRI screen can read a data item from another system, modify it, and the post the new value back to the other system’s files. Alternately, NPRI telephone functions can be incorporated into other systems, or a few NPRI screens can be added to an existing application. The new NPRI system will read the data dictionary of standard relational databases directly, making it place external data in NPRI screens.

The cost per user of an NPRI system ranges from $2,000 to $6,000 depending on the number of users and the applications purchased. Installation costs $10,000 to $15,000, while customization is rarely less than $20,000 to $50,000, and can be much higher depending on the scope of the changes.

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David M. Raab is a Principal at Raab Associates Inc., a consultancy specializing in marketing technology and analytics. He can be reached at draab@raabassociates.com.