It's the telephone, stupid. "A goldmine whose potential remains largely unutilised by marketers in India," that's how Asian Paints marketing head Ashwin Dani sees this humble instrument.
But things are changing. Companies selling anything from internet connections to soaps to automobiles are fast waking up to the power of the telephone. It's cheap, it gets the customer's attention much faster than a direct mailer can, it allows marketers to develop a reliable database quickly, it invariably gets you a response, whether positive or negative. "It helps you feel the pulse of the consumer's preferences," says Dani. "Our product is something you don't need to buy every year, so the tele-connection helped us convert a significant number of such paint buyers into loyal customers."
Former Procter & Gamble ceo Gurucharan Das sees telemarketing only gathering strength. First, it's new. Second, it helps the company add a subtle personal touch—a live person, a real voice—something which other direct marketing tools like mailers cannot achieve. Third, you can be sure of your customer's loyalty. "More and more companies will first prefer telemarketing or e-marketing to test the waters and eventually go for direct mailers," says Das.
Indian direct response adspend may look minuscule compared to the west—the 1998-99 US direct response market was $202 billion (Rs 9,10,000 crore) with telephone consumer connectivity at $60 bn (Rs 2,70,000 crore)—but it leaped from Rs 119 crore in 1999 to Rs 180 crore last year, a growth of 60 per cent. And the telephone's importance will only grow, to develop the consumer data, conduct surveys, offer promos and eventually sell new products. And why not? India will have 125 million phones in another seven years' time and 30 million mobile connections in five years.
"It's helping us reach anywhere and everywhere, even when people are holidaying. There are very few misses and the recall value is high. After all, it's far easier for someone to pick up the phone than open a snail-mail from the letterbox and write on its response page," says Trikaya Grey vice-president Ashutosh Khanna, who claims that the sales of one of his clients, Domino's Pizza, shot up significantly after it added a toll-free number. Agrees hta president Sunil Gupta: "The trend is new, so it's catching on fast though it will be difficult to say whether this will replace snail mail." But Dialnet ceo G.D. Binani, whose teletext services are being currently used by companies like espn, American Express, Coca Cola, Citibank, Kingfisher, Unit Trust of India, and the Taj group of hotels for promotional offers, is on cloud nine: "There are a whole range of packages offered by companies which consumers love to hear over the phone." And fuelling this growth are all the call centres mushrooming across the country. With an estimated turnover of Rs 400 crore, there are more than 60 call centres already up, and the number is increasing fast.
The list of telemarketing users seems endless. For example, auto major Maruti Udyog Limited recently asked Lintas Direct to use the phone to tap high-income individuals for the newly launched Baleno. The response was apparently 30 per cent more than what the agency normally gets through routine direct mailers. Similarly, mul claims to have received a significant response after it introduced a toll-free number to handle customer response in Delhi, a move which the company now hopes to take to as many as 14 cities. JK Tyres registered a clear 30 per cent increase in sales after customers were not only allowed to order tyres on the phone but also offered additional services. Godrej Pillsbury, which recently launched its cake mix, has Namaste Pillsbury, a toll-free number available in 30 cities that answers queries on its products. White goods giant Electrolux has launched a register-complaint-service through the phone and net. "It gives you instant and accurate feedback and also helps expand your network, which comes in handy for all future promotions and sales," says Ranjan Malik, associate vice president of Lintas Direct.
The word of caution, though, comes from Srikant Sastry, ceo of direct marketing firm Solutions. "Telemarketing has a huge market but India does not have the infrastructure which a developed nation like the US would offer. For example, the US has more than 70,000 call centres," he points out. "So market growth will be directly proportionate to that of available infrastructure." And the country's track record in that is not too encouraging.