The Power of Prospecting

Reps who shift their focus find no shortage in ad business

Imagine the scene: a newspaper advertising team is gathered for an end-of-day celebration. They form a semi-circle around a large whiteboard. There are cheers and jeers as each rep reports prospecting success and sales results for the day. Kathy, a long-time real estate rep writes $15,000 on the board as her results for the day. She turns to the group and says, “There’s a lot of business out there from people who are not going to call us.”

For years I have worked with advertising reps to help them improve their sales effectiveness, and recently we’ve all seen how the marketplace has changed. Today newspaper leaders are recognizing that reps are spending too much time servicing existing accounts and not enough time prospecting for new business.

The competition—alternatives to newspaper advertising—have focused on prospecting for a long time now. Perhaps it’s because their product did not give advertisers the ROI that newspapers provided. Maybe advertisers weren’t calling and the reps had to prospect just to stay in business.

I have known radio sales managers who didn’t allow their reps to be in the office between mid-morning and late afternoon. That was prospecting time. I’ve seen others require their reps talk to at least 10 potential advertisers daily. These might have been tough policies, but perhaps they were necessary to survive!

My experience in working with newspaper clients has shown me that today’s market holds a tremendous number of sales opportunities for newspaper reps who go out and get them. What’s more, the competitive landscape has changed, making it essential for newspaper reps to spend more time prospecting, and consequently win more business.

So here are some tips for newspapers that want to capture more advertising dollars:

1. Communicate compelling expectations to reps. Most reps tell me they are too busy servicing existing accounts to do much prospecting. Tell them that the competitive landscape has changed, and that spending more time prospecting is not optional.

2. Communicate specific, measurable, actionable prospecting goals.

3. Inspect what you expect. If the goal is to call 30 non-advertisers a day, inspect the call sheets regularly.

4. Celebrate successes. In 1955 no one believed a human could run a four-minute mile because no one had ever done it before. But when Roger Banister reached this goal, 16 other runners achieved it within weeks. Celebrating advertising sales successes will have the Roger Banister effect on your team.

5. Don’t blink. Your people are not going to like prospecting. They will come up with every excuse imaginable to avoid it. If you accept a rep’s excuse for not reaching prospecting goals, you’ve not only blinked—you’ve also lost business!

Newspapers whose reps are prospecting have discovered that, despite changes in the competitive landscape, the advertising dollars are out there to win. So the message for reps is, don’t wait for the calls—go out and get your share!

High return on investment

Newspaper with growing circulation points to the value of follow-up on service errors

Recently I’ve been working in the customer service department of a large newspaper that holds the distinction of growing circulation. Sure, it has the benefits of a growing market and a good product, but the same is true for many newspapers with declining circulation. So what makes the difference? This newspaper might be considered downright fanatical about following up on all service errors, except that the results make their emphasis on follow-up quite rational.

Missed paper? A replacement arrives within 30 minutes. Same time the next day, a rep calls the subscriber to make sure that day’s paper arrived.

If a subscriber cancels for poor service, the district manager follows up to solve the problem and win back the business.

The newspaper empowers its customer service reps to make sure every problem gets fixed. They can call carriers themselves. They follow up personally on each service error call to make sure the issue is resolved.

Every district manager rides with new carriers for the first full week of delivery and for the first two Sundays.

I run a call center that makes outbound retention calls on behalf of newspaper clients to subscribers who are late in grace. By the time we get the records and make the calls, theses subscribers have made up their minds that they are going to quit the paper. It is our job to win them back. I listen to several hundred of these calls each week. Here’s what I hear regularly:

• “I got a new subscription and it was delivered OK for two weeks and then it stopped. When I called to complain, nothing was done. If you can’t deliver the paper, just never mind.”

• “I got a bill that was wrong, I asked for a corrected one, it never came. I refuse to pay this incorrect bill.”

• “I paid for a year in advance, and you have not given me credit for the payment. Now you have stopped my paper. If you can’t keep things straight, I don’t want to deal with you.”

• “We moved, but we never got the paper at the new address. You seem to be able to mail a bill to my new address, but not my newspaper! I have called three times, and still no delivery.”

Every one of these problems and hundreds like them would be solved—relatively easily and inexpensively—with a service error follow-up call. Yet newspaper executives tell me daily that their team members just do not have time or resources to follow up with subscribers to make sure their problems were fixed.

In response, I point to the newspaper I have cited here that requires its staff to make the time and invest the resources. Without a doubt the apparent returns to their bottom line and circulation figures have far exceed their investment of time and resources.

With the right approach, outsourcing customer contact works

The key is to partner with vendors in focusing on the behaviors that drive desired results

Demand for outsourced call center services is rising fast in the newspaper industry. The Newspaper Association of America reports that 60 percent of all newspapers outsource at least some of their sales efforts. While outsourcing has been common in sales for some time, the industry is turning increasingly to outsourcing for customer service. Most recently, newspapers who have outsourced to McClatchy Company’s soon-to-close C3 call center are seeking new customer contact partners. But can newspapers manage outsourcing effectively enough to get the top performance needed in today’s competitive media marketplace?

Newspapers that have formed true partnerships with the right outsource vendor answer that question with a definitive yes. But before they form such partnerships, the newspapers that are the most successful with outsourcing are doing their homework.

Key indicators and behavior management
Newspapers most successful at outsourcing customer contact determine key performance indicators in advance of the outsource partnership by benchmarking based on their in-house operations and industry research. Then they figure out how to manage the behavior that will drive those results.

The best way to explain this is to use an analogy. Imagine a baseball player in a tight game. The team manager could focus on the desired result by yelling, “We need a hit! Drive in that runner!” But it is far more effective to manage the behavior by saying, “OK, now stand a little farther back in the box and choke up on the bat!”

By the same token, if the newspaper wants to save 40 percent of its subscribers who call in to cancel, the rep needs to hear more than, “We need a 40-percent saves rate.” The effective call center supervisor will say, “OK, on the next call you need to ask more discovery questions to get the subscriber’s true reason for cancellation. Then you’ll know how to present a solution that addresses the subscriber’s wants, interests and needs. You’ll be able to win the save based on the newspaper’s value to the subscriber.”

But by and large, vendors need help implementing this behavior-based approach.

So the best outsource partnerships begin with clear agreement between the newspaper and the vendor on the behaviors that will drive the key performance indicators and desired results. Then, the newspaper takes a hands-on approach to helping the outsource partner practice those behaviors consistently.

Owning the numbers, calibrating the calls
What strikes me most about newspapers who do well with their outsource partnerships is that not only establish a system for managing the behavior of their outsource vendors, but they also own the numbers. They set aside time in advance to get the current numbers, study them and prepare to discuss them thoroughly with the outsource partner. The comes the behavior management—the weekly call calibration.

Call calibration means that the newspaper and the outsource partner—independently of one another—monitor the reps and score them on the agreed-upon behaviors including a consistently applied, robust call flow. Each week, they meet and compare the scores to make sure that the outsource partner is evaluating the reps’ behaviors properly and consistently. They not only communicate but over-communicate to ensure that the outsource vendor continues to buy into the key performance indicators and behavior that drives them.

Remote monitoring and coaching
I have found that it is critical for the newspaper to dial in and listen to reps without the outsource partner being able to select reps for evaluation, and to make site visits regularly. These steps increase the likelihood that the newspaper will hear lower performers on the phones and then take steps with the vendor to correct problems.

Recently I saw that monitoring alone by one newspaper increased its outsource vendor’s performance by 40 percent!

The most effective outsource vendors have their supervisors doing side-by-side coaching. This involves much more than wandering around and observing. The supervisors are experts at the call flow and desired behaviors. They model these processes and behaviors for reps and do one-on-one coaching between and during calls. They listen to calls on the spot and guide their reps to mastery. By all accounts, outsourcing works best when the newspaper has chosen a partner who has the resources to provide this type of coaching—and a proven track record for doing so effectively.

Indeed, outsourcing customer contact can have a dramatically positive impact on the newspaper’s bottom line. It works for all types of calls—from inbound to outbound, from customer service and retention to new subscriber sales. But like everything else in the realm of communicating with customers, it boils down to having a quality conversation, building rapport, and offering solutions. It means setting goals and delivering value. It’s about behaviors!

Based on what I have observed in the field, outsourcing is producing stellar results given the right approach—managing behaviors, owning the numbers, and working in real partnership with the outsource vendor.

Maximizing classified ad sales

Five winning steps net sales from current non-advertisers

Given that newspapers earn between $25 and $85 per contact on outbound calls to classified advertising prospects, it makes perfect sense that we should be making as many outbound calls as possible. But once we get those prospects on the phone—particularly those who are non-advertisers versus expired listings—how do we maximize our sales earnings per contact?

When selling advertising on the telephone versus face-to-face, it is all the more important have an incisive, quality conversation with the prospect to quickly gain rapport and communicate value.

In my experience training and coaching classified ad sales reps and their supervisors in newspaper call centers—and in my own outbound classified call center—we have followed five winning steps to selling classifieds to prospects who are currently non-advertisers.

Step 1 - Greeting. From the very beginning we must be enthusiastic and engage the prospect with clarity of purpose. It is critical to build rapport within the first few seconds of the call by letting prospects know they are speaking with someone who can help solve their problem.

Step 2 – Modified Needs Analysis. An outside sales representative must conduct a needs analysis—an assessment of the prospect’s wants, interests and needs. By the same token, a similar process must take place when selling classified ads over the telephone, but much more quickly because prospects generally have less patience by phone than in person. We call it a modified needs analysis, and it must zero in on the prospect’s advertising motivation.

For example, the rep might ask, “What would it mean to you to have an effective ad that resulted in calls from the most qualified prospects for your job opening?” or, “What if we could help you reach more prospective buyers so you could sell your boat more quickly?”

Step 3 – Solution. Based on what we learn in the modified needs analysis, we’re in a position to address the advertising motivation directly and effectively. By listening to the prospect, we know how to frame the solution: that the newspapers print and online classifieds will get the job done well.

Step 4 – Overcoming objections. Most often, prospects will voice price objections. It is critical to answer the objections not by dropping the price, but by returning to the advertising motivation we learn via the modified needs analysis. For example, the rep might say, “By going with our print and online ads, you’ll get not only active job seekers, but also highly qualified passive job seekers who you would otherwise miss—great candidates that you’d love to have on your team.”

Step 5 – Close. If and only if we’ve done all the other steps correctly, the close will happen almost automatically. It is our job to enter this step having done everything we can to make our ad sale the only logical conclusion for the prospect.

For additional reading

Like any process, following these steps effectively takes considerable training, coaching and practice before the rep masters it. I have provided more information on in-house training and coaching solutions at http://robertcdavis.net.

However, many newspaper call centers have their hands full with inbound classified calls, as well as customer service and retention on the circulation side, and don’t have the resources available in-house to maximize the benefits of making more outbound classified ad sales calls. For details on SURPASS, a newspaper-specialized call center offering services on an outsource basis, visit http://robertcdavis.net/outsource.html.

By putting effectiveness before efficiency, newspapers grow top-line revenue

As newspapers strive to protect their bottom lines, I hear a lot of talk about efficiency. Should we centralize our operations? Can we outsource call center operations at a lower cost than we can handle it in-house? Should we send our work overseas? Yet I believe we should focus on growing top-line revenue—on effectiveness instead of efficiency.

Let me give you a few examples.

Call abandon rates versus top-line revenue
For newspaper classified call centers everywhere, the call abandon rate is a key measure. However, it is too efficiency-minded to manage the call abandon rate with head count alone.

A better approach is to examine call center effectiveness by asking what the call center can do to grow top-line revenue. Find out how many outbound calls your people are making in their extra time. In my experience working with classified departments across the country, the problem is that reps often cherry pick instead of calling all current prospects and advertisers. Nationwide, I see tremendous room for improvement in this regard.

Cost of winning new customers
At most newspapers, the number of subscribers who call in to quit each year represents at least 20 percent of circulation. That number climbs to 30 percent or more at some newspapers. At the same time, the industry saves only 17 percent of these subscribers from canceling. When it was cheaper to win a new customer than to keep an existing one, maybe these numbers were OK. Today we can and must do a better job retaining subscribers.

Significant improvement is well within reach for virtually any newspaper. After all, other subscription-based industries achieve 50-percent and even 60-percent saves rates regularly. And by focusing on effectiveness instead of efficiency, top-performing newspapers are earning 40-percent saves rates.

Say you have a circulation of 300,000 and receive 100,000 cancellation calls in your call center each year, and that you save the industry average of 17 percent of these calls. The efficiency-based measure would be talk time, and our work has shown that it takes an extra 30 seconds on the phone have a quality saves attempt.

Yes, spending 30 seconds more costs the paper around 50 cents. However, the extra effort will drive your saves rate up by 23 points. This means 23,000 fewer subscribers you will need to replace at $40 or more apiece, adding up to almost a million dollars per year. It’s a great example of how effectiveness beats efficiency hands down.

Online advertising expertise
Here is another example. Most newspapers have only a handful of online advertising experts. The sales force relies heavily on these experts to help them sell online ads. This is an efficient way to handle it, but is it the most effective? To answer that question, look at the amount of online revenue you receive today from existing advertisers. If it is not as much as it should be, maybe the efficiency model is not working well for you. To boost effectiveness, train all your sales reps to sell online ads effectively so you can maximize this revenue source.

When market conditions present challenges such as circulation decline and technological changes, the natural result is pressure to be more efficient. But in my experience in the newspaper industry, organizations that resist the pressure and focus instead on effectiveness see dramatic improvement in customer service, customer retention and sales. The return far exceeds the investment.

Viable strategies for success

Newspaper Next produces excellent foundation for action

When the American Press Institute undertook Newspaper Next to research and test new business models for our industry, the overall goal was to find ways for newspapers to survive the “strategic inflection point”—the recent period of disruptive changes including declining circulation, rising costs and downward revenue trends. This well conceived, thorough initiative has produced excellent strategies for leadership and transformation within the newspaper industry. Now it is time for us to execute those strategies in the most effective and sustainable way.

Driving deep
One of the key components of Newspaper Next is to think of “jobs to be done” versus products. This is akin to the story of the drill bit salesman who sells the value of quarter-inch holes instead of quarter-inch bits. This kind of thinking must occur from top to bottom in today's newspaper organizations and marketplace. So how do we get there?

To follow the lead and direction established by Newspaper Next and other positive initiatives, newspaper organizations must empower themselves to do what they are capable of doing and, in fact, must do to survive. Specifically, every newspaper organization should develop a leadership program that drives deep, one that will take publishers and their direct reports out of their offices and into the company and community to drive top-line performance.

Let’s look at some actions to take through such a leadership program based on the ten competencies outlined in Newspaper Next.

1. Vision – Prepare publishers and their direct reports to leave their offices twice per week for a leadership walk. Over about one hour per walk, they should have one-on-one conversations with employees to address concerns and share vision for strategic goals, innovation, creativity, learning and accomplishment.

2. Customer Focus – Enable publishers and their direct reports to call on advertisers who have not advertised within the last six months. Imagine how impressed a car dealer will be to look up and see your publisher in the dealership working to understand and address its advertising needs. Additionally, publishers and their direct reports should listen to an hour of customer service calls each week. In all cases, they should be focused on opportunities to fulfill the wants, interests and needs of existing customers and new ones.

3. Championing Change – People will not change unless they are encouraged to do so. The newspaper’s leadership team must develop and commit to using new skills with their people. Emphasis should include the need for positive attitudes, embracing change and taking personal responsibility. As leaders use their new skills and adapt to the new paradigm, they will master those skills—and it will make a tremendous difference.

4. Driving Results – We must focus on top-line business. For example, each newspaper call center needs, in plain view of everyone, a scoreboard with target results. When leaders update the scoreboard, they should do so with fanfare and positive reinforcement for top achievers. Using these kinds of tactics will set high expectations, measurable goals and accountability in an atmosphere of persistence, positive thinking and recognition.

5. Interpersonal Communications – Publishers and their direct reports should receive coaching to improve their ability to communicate in a compelling way with their people. Ideally, a class or seminar should be organized that uses public speaking as the vehicle for driving change. Set goals to ensure that any representative of the newspaper can establish good rapport and communicate effectively inside and out.

6. Relationship Management – Obviously human relations skills are critical in meeting goals, working collaboratively and understanding the needs of internal and external customers. One suggestion is to establish a program that gets publishers and their direct reports to pick one human relations skill per week that needs improving, and then work on it during that week.

7. Coaching and developing – As a top priority, leaders must master the skills they need to coach and develop their direct reports on work-related competencies and career growth in a highly effective, sustainable way. It’s hard work and likely requires outside help to implement, but just think of the positive impact this will have on top-line revenue!

8. Integrity – It is my belief that a leader either has integrity or does not, and adults cannot be taught integrity. However, leadership must make it clear that integrity is an absolute within the organization. It is critical to reinforce the value of working with integrity on every level and at every step.

9. Business acumen – Every leader has certain strengths. It is critical to assess and tap the talent of leaders and their teams. Do so under the premise that everyone must first understand general business and financial concepts, and then be able to coordinate and put to work specific competencies for maximum positive impact on the organization’s business.

10. Learning agility – For an organization to have learning agility, its leaders must look constantly for ways for its team members can improve. This is essential in adapting continuously to the newspaper marketplace and maximizing individual and organizational performance.

Meeting the challenges
Without a doubt, Newspaper Next has been a highly valuable and essential initiative for the industry. It has put the ball in play and in our court, and newspaper organizations must react by retooling themselves so they can maximize the Newspaper Next competencies—a comprehensive ten-point framework that will help us meet the challenges of the 21st Century.

More contacts, more ad sales

By focusing on dials and quality conversations, reps reach more prospects and sell more newspaper ads

Newspapers earn between $25 and $85 per contact on outbound calls to classified advertising prospects. The problem is, newspapers are not talking to enough prospects.

Not the only game in town anymore
The world is changing fast for the newspaper industry, and nowhere is this change more apparent than in the classified advertising department. Competition is virtually everywhere—particularly in the form of publications that offer free advertising for homes, autos and private party items. The Internet is a strong player in employment and auto sales advertising, and it is becoming an increasingly important vehicle for real estate advertising. As a result, long gone are the days when we can sit back and wait for the phone to ring. We are no longer the only game in town. We can’t meet our goals by merely serving the calls that come in to us.

In the past, auto dealerships absolutely had to be in the Saturday newspaper. With so many different ways to advertise today, dealers don’t see the value of the newspaper in the same light as they once did. It’s time to refocus their attention on the strong value they receive from newspaper advertising.

Seeking them out
In newspaper advertising sales, we have to seek out prospects now more than ever. And when they do come to us, we must give them a compelling reason to advertise with us. We have to sell value.

One thing that hasn’t changed is that advertising clients demand—and deserve—a high level of excellence from newspaper. They expect newspaper advertising reps to understand their needs and show them products and services that will help them achieve their goals.

It’s not a stretch to say that newspapers remain one of the best values in America for readers and advertisers. We simply have to have quality conversations with every prospect, and we have to reach as many prospects as possible, to get the value story out there more effectively.

Dialing without distractions
A sales office observed recently had two sales people. One sold three times as much as the other. Interestingly, the sales person who was selling less actually sounded better when talking to the customers. So why was this person lagging behind? The answer came in watching them work. The top-performing sales person made a dial, and then immediately made another dial. She consistently made five times as many dials as the other rep.

The person who sounded better on the phone—who gave a better sales presentation when speaking to a customer—made a dial, and then took some notes. He’d look through some papers and take a drink of water, and then make another dial. The result was far fewer dials.

No matter how good a rep is on the phone, being a top sales performer still means talking to a large number of prospects. Staying focused on making dials requires the rep cut out distractions.

The value of block time
Cutting out distractions can be hard when reps have other duties. But in our work with newspaper classified advertising sales departments, we have seen remarkable success when reps have a certain time of each workday blocked out for prospecting. In doing so, reps have achieve 30 prospecting dials per one-hour of block time, and then 30 prospecting dials total during other parts of the day for a total of 60 dials per day. The result? Three times as many sales.

Bear in mind that another factor in this success has been the quality conversation itself. Reps need training, coaching and continual development on a proven, robust sales model and call flow to achieve and sustain high sales performance. The point is that a comprehensive approach to prospecting and quality conversations with prospects sells value and nets a dramatic increase in newspaper advertising sales.

Five keys to success in telephone prospecting, classified ad sales

In my 25 years of work in training, coaching and consultation within newspaper call centers—as well as five years as a consultant to Morgan Stanley, whose lifeblood is telephone prospecting—I have come to recognize five keys to telephone prospecting success that we can apply in today’s market for newspaper classifieds.

1. Enthusiasm. Successful telephone prospect

ing is 12 percent what sales reps say and 88 percent how they say it. On the telephone and with life in general, enthusiasm is the little-recognized secret of success. Prospects can only hear and feel your attitude, and it must be enthusiastic, confident and positive.

2. Good lists. Forty percent of a rep’s success will be related to the quality of the list. Besides accurate numbers, a good list has well-qualified prospects with whom reps have some sort of connection, enabling them to build rapport quickly.

Additionally, it is important today to put automatic systems in place that will generate lists throughout the year based on key criteria including:

• Previous advertisers who have not advertised within the last 90 days.
• The previous year’s seasonal or special-day advertisers, many of whom are likely to want to advertise again this year for Christmas, President’s Day, Mother’s Day and other annual occurrences.
• Advertisers whose ads are about to expire.
• Advertisers who have placed ads around special events such as business anniversaries, end-of-model-year, local festivals, athletic events or arts and entertainment.

All reps should receive such lists regularly so they can, for example, call every restaurant in town about advertising their Mother’s Day, New Year’s Eve, or Valentine’s Day specials. Supervisors should provide close guidance and frequent follow-up on using these lists.

3. Pace. Telephone prospecting involves developing a rhythm—one that comes from cutting out all distractions and allows a sales rep to stay focused on the behavior of making dials. If you focus enough on desired behaviors when telephoning, desired results will follow.

When it comes to pace, it is important to set aside block time—times of the day and week that are most conducive for reaching targeted prospects. During this block time, reps should be making at least 30 dials per hour.

4. Skill. Sales reps who have appropriate enthusiasm, a good list and great pace will see their skill level improve significantly because they will be generating enough “at bats” to get better on the telephone. The skills required to become a good sales rep—a good greeting, good discovery questions, excellent objection-handling, appropriate solution, compelling offer and assumptive close—develop significantly under fire from prospects.

It is important to consider giving reps scripts to follow so they communicate effectively and appropriately and avoid bad habits.

5. No avoidance. Prospecting is hard work and reps, by human nature, will succumb to avoidance behavior without discipline and prevention. Get creative—run outbound parties and specify special block times to drive enthusiasm and dials per hour. Have daily contact with reps to see how many dials they can make daily. The bottom line is that we must measure activity level every day to make sure reps are not avoiding what they must do.

It is safe to say that the days when classified reps could sit back and wait for the phone to ring are long gone. Newspapers are no longer the only game in town. We can’t meet our goals by merely serving the calls that come in to us. It has never been more critical to focus on telephone prospecting—and to do it very well.

Listening before you leap

A problem truly understood is already half-solved

When subscribers call in with a cancellation request, the most common reason they give is that they don’t have time to read. In many newspaper call centers, reps hear subscribers give this reason and then immediately jump right on the fix—usually a downgrade in the frequency of delivery or a drop in the price. But they’re jumping far too soon.

The real reason
We have found in our extensive work with newspaper call centers that it is critical to begin a robust discovery phase on the call as soon as a subscriber tells us why he or she wants to quit. Why? Because very often, the first reason a subscriber gives isn’t the real one.

In a robust call flow, our first response to the subscriber not having time to read should be a restatement:

“So if I understand you correctly the reason you want to leave us today is that you don’t have time to read. Aside from that, are there any other problems with you newspaper or its delivery that would cause you to want to cancel today?”

More than 40 percent of the time, subscribers give a second reason that turns out to be the true problem that led to the cancellation call. So on almost half the calls we handle, jumping on the fix doesn’t address the true cancellation reason.

Lower cost, higher profit
It follows that if we find out the true cancellation reason and address it instead of papering over a problem with a quick-fix or a discount, we will have higher customer satisfaction, better retention, and a more profitable organization. After all, it costs much less to keep an existing customer than to go out and win a new one.

We have found that many subscribers don’t call in with a service and billing issue until it has happened numerous times, or they’ve called in previously but the problem hasn’t been corrected. In either type of case, many subscribers don’t reveal the real issue until we complete discovery by restating and assuring help, asking about additional concerns, and then isolating the true reason for calling.

Selling value
Finally, another common reason for canceling is the end of promotional discounts. This occurs when a subscriber gets a high bill for renewal and calls to quit but doesn’t reveal the real concern until we follow the robust discovery process. If we know that price is the issue, we can begin a value discussion with the subscriber that focuses on features and benefits. When we get the subscribers talking about features they enjoy, suddenly price becomes less of a concern because they recognize the value of the newspaper!

The bottom line is that we can’t solve a problem unless we know what it is. We don’t always know the problem unless we ask for more information. There’s an old adage that says a problem well-stated is half-solved. By engaging in robust discovery, we’re helping the subscriber state—and ultimately solve—the problem. We’re helping the subscriber see value. We’re winning loyalty and retaining our most profitable customers—the ones we already have.

Universal lesson: How Xerox turned a $273 million loss into a $978 million profit

Five years ago, Xerox was facing possible bankruptcy. Revenue and profits had declined, cash was going down, and debt was increasing. The company faced angry customers and defecting employees. On the day Anne M. Mulcahy (pictured at right) was named president and COO of Xerox, the company had lost half its share value. Looking back today, how Xerox changed its fortunes under Mulcahy’s leadership carries lessons for virtually any industry—including the newspaper business.

You can read the whole story in an article* by Mulcahy in the January 2007 issue of Leadership Excellence magazine, but here I want to emphasize several of her key points and how they apply to our business.

Mainly she covered five winning strategies Xerox used after deciding to focus on customers as the top priority in turning the company around. Let me paraphrase them and relate them to specific facets of newspaper industry.

Strategy 1:
Listen to your customers and determine their wants, interests and needs.

This may seem obvious, but I want to focus on the importance of newspaper circulation executives—not just call center reps—being in touch with subscribers. Leaders who make their offices adjacent to or in the midst of the call center can monitor easily and tend to be in tune with how well calls to and from subscribers are handled. This helps them understand things from the subscriber’s perspective and equips them to make informed decisions that serve subscribers more effectively.

One hour per week, every executive within the newspaper organization should listen to customers and the way customer service people talk to them. One easy way to do this is to record these calls and burn them to a CD that executives can play in their cars while commuting to work. Give these recordings to the whole executive team so they can spend time with the customers every week.

And while we are on the subject, it’s a good idea to get an hour’s worth of calls from your telemarketing vendors every week to hear what potential customers are saying about your product.

Strategy 2:
Invest in innovation.

Facing circulation decline, many newspapers argue that they don’t have the money to invest in customer service right now. Many push for outsourcing and reducing costs.

Yet according to Mulcahy, companies that retain an additional five percent of their customers will grow bottom-line profits by 25 to 50 percent. Furthermore it costs five times as much to win a new customer as it does to keep an existing one.

These views are consistent with what I have seen in decades of working with newspaper organizations on customer service, sales and retention projects. Newspaper companies that invest in proven, innovative customer service and retention training programs are earning a substantial return on such investment.

Strategy 3:
Make it every employee’s job to add value.

Xerox achieved its dramatic turnaround largely because it made sure that every customer interaction with employees—from top to bottom—was made positive by having meaningful person-to-person interaction and a genuine desire to help. This cannot occur without buy-in and support of value-based customer service and retention efforts at all levels of the organization.

Strategy 4:
Don’t sell quarter-inch drill bits. Sell quarter-inch holes.

How do we add value? Sell solutions. If you go to the hardware store to buy a quarter-inch drill bit, the assumption is that ultimately you want a quarter-inch hole. In my work training and coaching in newspaper call centers, one question rises to the top as a conversation-starter that has led to a six-fold increase in EZ Pay sales:

“What is your favorite section of the newspaper?”

We’re not selling newspapers. We’re selling the experience, the relationship, the part of the day subscribers enjoy with their newspaper. Asking them about their favorite section prompts them to remember the true value of their subscription. And it makes a dramatic difference in winning the save.

Strategy 5:
Exceed customer expectations.

Mulcahy cited data showing that 75 percent of customers who quit say they’re satisfied. She goes on to say that customers who say they’re very satisfied are six times more likely to stay on than those who are merely satisfied. And, she says, only 40 percent of customers who consider themselves satisfied buy again.

This confirms findings in a Harvard Business Review study showing that customers must be not just satisfied but very satisfied at the conclusion of every customer service contact to build loyalty and stability. According to the study:

• A customer who is merely satisfied resides in a “Zone of Indifference” where he or she has neither positive nor negative feelings toward the organization.

• By contrast, a very satisfied customer resides in “Zone of Affection” where he or she remains loyal to the organization and promotes it to others enthusiastically.

No matter what business you’re in, findings like these mean ‘good enough’ just isn’t good enough anymore. Effectiveness trumps efficiency. Value sells better than discounts and other gimmicks. We’ve got to dazzle them with service.

* Read Mulcahy’s article, “Customer Connection: You win when you listen to customers” in Leadership Excellence magazine, Vol. 24, No. 1. January 2007. Executive Excellence Publishing, www.eep.com.

Learning lessons from poor performers

Customer relationships suffer when companies adopt an internal focus

Recently I flew the regional airline that has the worst record in the industry for late departures. The experience reminded me that one can learn some valuable lessons about customer service—usually what not to do—from poor performers.

Picture a gate being used by a regional airline at Boston’s Logan airport. It is snowing outside and the gate area is full and chaotic. In fact, it is standing room only due to canceled and delayed flights.

The fortunate few
Now picture a large oasis, a roped-off space about half the size of the gate area, in the middle of this bedlam. The fortunate few who are within the oasis are enjoying white rocking chairs, plenty of seats, tables and food.

You might ask, who had these privileges? Were they frequent flyers redeeming bonuses? Perhaps they were passengers being compensated for suffering the most severe inconvenience.

No, the people enjoying the oasis were employees of the airline. Right in the middle of a cramped gate area with not enough seats, they took care of their own. They made sure their flight attendants and pilots would have would have a good experience even if their passengers did not.

When a company thinks more about itself than its customers, as is clearly the case in our example, the company is internally focused. Interestingly, struggling organizations are likely to become more internally focused than customer focused.

Questions needing answers
Likewise, with all the challenges facing the newspaper industry, how many newspaper organizations are becoming internally focused? How many are spending too much time making things better for themselves while forgetting the subscriber? In the style of comedian Jeff Foxworthy and his “You Might Be A Redneck” routine, I’ve created a list that can help answer these questions.


You might be internally focused if…

…a subscriber looks up your main customer service number and gets a recording that says, right off the bat, “If you know your party’s extension, please dial it now.”

…it has been so long since you called your own customer service number that you don’t know what the recording says.

…you overhear your customer service people saying, “You should have called in by 10:30 this morning to get your paper re-delivered.”

…your supervisors are too busy with internal meetings and email to sit down and coach your low-performing customer service reps.

…you don’t know who your low-performing reps are.

…you don’t keep track of how many subscribers are canceling each day.

…you don’t know the saves rate on these cancellation calls by rep.

…you spend most of your new-hire training time teaching reps how to deal with circulation software instead of how to provide world-class customer service.

…you and your managers and supervisors are too busy with internal meetings to return subscribers’ calls.

Not a laughing matter
While Jeff Foxworthy is going for laughs with his routine, there’s nothing funny about the consequences of a newspaper—or any other business—being internally focused. In an industry experiencing circulation decline and paradigm shift, it has never been more important for newspaper organizations to ask yourselves whether or not you’re customer focused. If the answer is yes, the next step is to get even better at it. If the answer is no, it’s time for a change. Based on my experience with major newspapers across the country, the return on your investment of time, money and human resources in such improvement or change will be substantial.

Straightforward approach pays high dividends

I was delighted to serve as a major source for this trade article on InlandPress.org and was quoted extensively on the subject of how “Improving customer service starts at the top and pays huge dividends.”

No 'magic' – just commitment to serve
Wednesday, March 07, 2007 By Randy Craig | Editor, rcraig@inlandpress.org

Jon Louder, circulation director at the Mitchell (S.D.) Daily Republic, believes in the power of customer service. He shares a familiar axiom uttered by many over the years: A newspaper might boast Pulitzer Prize-winning news, but if the service is lousy, it will lose circulation. The converse is also true.

"You can have a mediocre paper, but if you have really great service, you'll probably gain circulation. This should magnify to everybody how important customer service is," he said.

Louder said the Republic is not perfect, but service has been good enough to keep the 12,000-circulation paper growing in a shrinking market. No magic bullets exist, he admitted. But years at the Republic have provided him some insight.

"There's no magic. Just focus," he said. "You have to focus on improving customer service every day. It's just getting employees and carriers to buy into it."

Louder's approach illustrates much about newspaper customer service. Everyone understands customer service is important. But how many realize its tremendous impact on readership and, potentially, circulation?

The most exhaustive examination of the effect of customer service on newspapers originated in the Impact Study of Newspaper Readership published by the Readership Institute in 2000. The study, which surveyed 37,000 consumers across the United States, determined that the greatest potential for improving newspaper readership came from raising customer service to the "exceptional" level.

Broken down, these service factors rank highest in terms of their impact on readership:

* condition and completeness of the paper
* quality of paper, ink and typesize
* when and how the paper is delivered
* accuracy of the bill
* cost of home delivery
* overall customer service

A newspaper's customer service strategy does not have to be complex to be effective. The primary element of any strategy is commitment. The initiative has to be ingrained in the culture.

Louder said customer service starts at the top with Publisher Noel Hamiel. Everyone at the Republic from Hamiel on down understands they are there to serve the customer. Of course, this attitude must be instilled in carriers, Louder said. District managers must clearly outline expectations.

"It may be time-consuming, but it's a necessity," he said.

Commitment must be to the right thing, warned Bob Davis, a circulation consultant based in Alpharetta, Ga. He said the overriding customer service mistake newspapers make is confusing efficiency with effectiveness.

Davis, whose clients have included Morris Communications properties, USA Today and the Miami Herald, said newspapers should not obsess over call time. Instead, they should concern themselves with metrics based on quality, not speed-metrics such as inbound saves rate, first-time resolution, service error followup or conversion to EZ Pay.

"There should be a drive toward having a quality conversation rather than a quick, get-them-off the phone conversation," he said. Commitment also involves training, Davis said. Customer service reps need to continually refine their skills with training and feedback. Motorola conducted an internal study that found that every dollar spent on supervisors coaching customer service reps returned $33 to the enterprise, according to Davis. At most newspapers, the employee charged with supervising customer service reps has as many as 22 tasks to perform any given day and spends only about 30 minutes engaged with the reps.

"Yet, (supervisors) readily admit that their No. 1 priority is coaching," Davis said. "But with all these other things they have to do, they end up with 22 different hats to wear."

One simple step trainers can take, Davis said, is to analyze how reps respond to a call. More than half of all customer service calls to newspapers are complaints. Yet, almost no matter what customers say, the first words they hear from a rep are "May I have your phone number please?" The first step must be to show empathy and issue an apology, Davis said.

"Start developing a rapport," he said. "We've become so task-oriented as opposed to people-oriented."

The payoff for coaching can prove tremendous. Davis said anywhere from 22 percent to 45 percent of a typical newspaper's circulation will call in to cancel over the course of a year. Newspapers should be able to recover 50 percent of these requests for cancellation, he said. The industry average for saving stops is around one in five, according to Newspaper Association of America. Part of the difficulty is determining the real cause for the cancellation. The top complaint is delivery problems. The No. 2 complaint is the familiar "no time to read." Davis said reps need to drill down past this excuse. He said in 53 percent of these cases there is a second reason prompting the cancellation. And in 80 percent of those cases, the second reason is the real reason the customers want to cancel.

Newspapers can tackle incremental changes in customer service like these or they can consider changes on a grander scale like the Post and Courier in Charleston, S.C.

After moving to a distributor-based system, the paper found that complaints dropped significantly, said Leon Barrineau, administrative manager in the circulation department. Instead of handling more than 500 carriers, the newspaper just had to deal with 20-plus distributors who hired their own delivery forces. Complaints wentto the distributors, not the paper, and carriers were divorced from bill collections.

With the lack of service calls coming in, the customer service department came to be overstaffed, Barrineau said. The paper decided to completely outsource its customer service.

As employees left through attrition, none were replaced. For those that remained, management found them other jobs at the paper. One employee left voluntarily.

The Post and Courier then contracted with the McClatchy Co.'s Customer Care Center (C3) located at The State, Columbia, S.C., to handle customer service calls.

Since the Post and Courier pays C3 on a per-call basis, the newspaper benefits from decreased call volume. To keep call volume down, the paper drives as many complaints and service requests as possible to www.charleston.net, its Web site. Customers can manage subscriptions here thanks to some basic tools found in the paper's circulation software from Data Sciences Inc. (DSI).

"The more Internet activity you have, the more automatic drafts that you do, the better customer service in the field, the better relationship distributors have with the customer-all of that plays into decreasing the phone volume," he said.

While the Post and Courier tops 95,000 circulation, Barrineau believes its strategy can work for both smaller and larger papers.

The online account access for subscribers is a "no-brainer" that can improve customer service at any paper, he said. But to substantially improve customer service, newspapers would likely need more people working more hours. Newspapers have to determine if they can generate enough business to justify the additional staffing, Barrineau said. If they cannot, then outsourcing might be an option if the transition is made with care.

"If you don't do it right, it can be gut-wrenching and can really upset your organization. But if you do it right and handle it tenderly, it can be a real success story," he said.

Outsourcing customer service remains a more complex solution than others. Louder at the Republic prefers attitudinal adjustments over anything else. Customer service is one of the things he can control at his paper. He can't control the news or what inserts will appear. But he can control the service customers receive.

"I've realized that in my years as a circulation employee, when it comes down to it the only thing you have complete control over is service," he said. "So that's what you focus on."

Contacts:
Jon Lauder, (605) 996-5514
Bob Davis, (678) 455-6812
Leon Barrineau, (843) 853-7678

Quick Tips: Customer Service Tips

* It might go without saying but when given a second chance, a newspaper must make good on its promise. Re-delivery must come through without mistakes.

* After a circulation problem has been resolved, offer the subscriber a coupon good for 5 days' credit the next time they renew their subscription. Include a personal note from the district manager or circulation manager. Show your concern.

* Don't be afraid to replace ineffective carriers.

* Always find out exactly what the problem or issue is with the subscriber. Always ask if there are other issues.

* Subscribers are more likely to respond favorably to a customer service rep if that rep shows a genuine interest in the subscriber. Ask the caller what his of her favorite section is. By tapping into the reader's emotional attachment to the paper, this question can shift the tone of the conversation toward the positive.

© 2007 Inland Press Association/Inland Press Foundation

Finally, you can outsource your retention calls without compromising quality

Win back more subscribers with a proven, customer-centered approach

Thousands of subscriptions for U.S. newspapers are stopped each day because of non-payment. Newspaper companies have tried to save as many of these cancellations as possible, but they've had no effective way to outsource their outbound retention calling. Until now.

Win-win approach

Robert C. Davis and Associates, known for generating millions of dollars for USA TODAY, the San Francisco Chronicle, Morris Communications, and many other clients with its approach to training and coaching in-house call center teams, presents a win-win way to outsource this critical job with world-class results.

Newspaper industry specialists

Garden-variety outsourcers do not have the specialized expertise required to produce your desired results in customer service, retention and sales. We do, and that's why we established SURPASS, a unique call center operation in Bedford, New Hampshire, built and staffed based on the principles we apply every day for our clients' in-house teams.

A growing number of high-profile newspaper clients are working with SURPASS. They include the San Francisco Chronicle, USA TODAY, the St. Louis Post-Dispatch, the Orlando Sentinel, the Birmingham News and the Buffalo News. They've signed on based on the SURPASS team's strong track record and proven methodology.

The power of experience and the quality conversation

Everyone on the SURPASS team has extensive experience in having quality conversations with subscribers who desire to quit. Our supervisory and telephone personnel have received extensive training and coaching on a robust sales model and call flow that have been proven time after time to win subscribers back.

SURPASS's robust call flow

1. Greeting
Enthusiasm, assurance of help from the start, clarity of purpose

2. Discovery
Listening, understanding the subscriber's wants, interests, needs and the true reason he or she has fallen into grace

3. Solution
Striking a chord with the subscriber based on what we've discovered

4. Offer
Helping the subscriber respond positively to our solution

5. Close
Winning the save with assumptive selling

Coaching for mastery

The call flow is shown here in summary form. It takes a significant level of training, coaching and on-the-job application to master it. Our supervisors receive call flow training and coaching until they become masters at demonstrating the call flow. This equips them for what is one of the most important elements of their job: being out on the floor coaching their reps.

One-call resolution

The key to success on many retention calls is fixing the problem. Our retention operation has processes in place that allow us to work for you as a one-call resolution center. We work this way because a newspaper should never take the chance that it will lose an at-risk subscriber by asking him or her to call back for customer service.

References

For candid outside assessments of RCDA and SURPASS, feel free to request reference contact information by email or call Bob Davis at 678-455-6812.

About Bob Davis

RCDA president and SURPASS co-founder Bob Davis is an expert in training and coaching for customer retention and sales in customer contact centers.

His long track record of successes with RCDA and with a national training and consulting organization spans more than 25 years.

Read Bob's complete bio at www.robertcdavis.net.

About Ken Nemcovich

Before joining SURPASS, call center expert Ken Nemcovich worked for America Online (AOL). His call center work at AOL saved the company $9 million, reduced credit by $22 million and identified $90 million in cost reductions. He raised retention rates from 15 percent to 63 percent, and boosted revenue by $5 million.

Ken brings the techniques that worked for AOL to the table for SURPASS, and he has generated similar results for our clients.

Let's begin the partnership.

When it comes to your retention calling efforts, dial in a dramatic improvement. Partner up with SURPASS.

Robert C. Davis and Associates, Inc.
SURPASS
103 Smith Forest Lane
Alpharetta, GA 30004
tel: 678-455-6812
cell: 678-548-1775
www.robertcdavis.net
bob@robertcdavis.net

Project success story: USA TODAY

Client:
National Customer Service (NCS), USA TODAY

Internal Brand:
HEROES

Duration:
12 months

Challenge:
NCS is responsible for the success of two call centers which handle all inbound customer service and outbound retention calls for USA TODAY. The two call centers are located a continent apart with one center being operated by an outsourcer that handles calls for a disparate group of clients. The call centers were doing an adequate job of addressing subscriber concerns and inquiries, but lacked processes to ensure that high-quality conversations were taking place with each and every caller. Recognizing that each call is a valuable sales tool, NCS engaged Robert C. Davis and Associates (RCDA) to implement a sales model capable of increasing subscriber retention, increasing the number of subscriptions paid through EZ Pay, and boosting new subscription sales.

Approach: With the support of top leadership at USA TODAY, RCDA launched the HEROES (Helpfulness, Empathy, Respect, Ownership, Empowerment and Service) project. HEROES was a fully customized training, consulting, and coaching program aimed at changing the way in which NCS personnel view their respective job functions. By incorporating RCDA's robust sales models into the HEROES call flows, NCS reps were able to get to heart of subscriber concerns, needs, and desires. Once the effectiveness of the HEROES process was demonstrated, RCDA launched a full-scale certification program aimed at promoting project sustainability. Through its carefully designed assessment methods, the certification program allowed NCS and RCDA to recognize outstanding performers as well as uncover any lingering areas of weakness within the organization.

Results: The HEROES project revolutionized the way in which NCS handles subscriber touches. Prior to the project, NCS reps were making little or no attempt to "save" subscribers who wished to cancel their subscriptions. After implementing the HEROES process, reps are consistently retaining 40 percent of subscriptions associated with cancel calls. NCS reps also used the HEROES process to generate four times as many EZ Pay subscriptions. But the dramatic results do not end there. By training and coaching the outbound reps in the HEROES process, the average number of sales per hour jumped from 0.9 to 3.4 for an increase of more than 275 percent. The certification process proved to be the key ingredient to sustainability because it motivated NCS personnel to continually demonstrate mastery of the HEROES process. With a significant amount of advertising and subscription revenue tied to every retained and satisfied subscriber, USA TODAY has added millions of dollars to their bottom line as a result of this project.

Discovering higher profits

When you're on the phone with customers, it pays to ask questions

By Bob Davis

Newspaper customer care centers across the land today have an opportunity to mine real gold by asking subscribers the right kind of questions with every contact. In my work with major media companies in the U.S., I have proven time and again that asking these questions consistently-which means adding a discovery step early in the call flow-will lead to a dramatic boost in sales and customer retention.

The right message

For starters, when reps ask follow-up questions, customers get the message that they're on the phone with someone who is interested in them, wants to listen and cares enough to be truly helpful.

Let's say a customer calls in to report a problem and says, "I didn't get my paper today." With a discovery step in the call flow, the rep responds with enthusiasm, helpfulness, sympathy and interest in learning more:

"Oh, I'm so sorry to hear that. I'm glad I got your call because I can help you with that today. Tell me, is this the first time this has happened or have we disappointed you more than once?"

When customers call in with a complaint such as this, they are annoyed. The first benefit of this discovery question is that psychological studies have proven when people talk about something that upsets them, they become less emotional and more logical. Getting a customer into a logical frame of mind increases the likelihood that you'll be able to solve the problem. Then it's time for another discovery question:

"Again, I'm sorry to hear that. I know how important the paper is to you. By the way, what's your favorite section?"

Selling themselves

This is where the second benefit of discovery comes in. When customers talk about the value they receive, they sell themselves and become more receptive to the solution. If the customer answers, "You know, my coffee just doesn't taste the same if I'm not reading the Sports section," you're in a strong position to ask for a chance to fix the problem. The chances are much better that the customer will accept the solution and respond affirmatively to an offer. This comes in especially handy when customers call in to cancel. They sell themselves, and you get more saves!

The discovery step carries a third benefit when a customer calls to cancel. Studies have shown that as much as 50 percent of the time, customers don't give us the real reason for cancellation initially. Again, asking discovery questions get customers talking about their problems so they're less emotional, more logical and more likely to accept your solution and stay with you as a subscriber.

What's more, everybody reads a different version of the same paper. Some subscribers might jump right to the Arts and Entertainment section, world news or the community page. Others check the sports scores each morning as part of their daily routine. One reader may be searching for a new job and checks the classifieds before the headlines. Another zeroes in on business news. Another reads stories in the fitness and living sections first. The bottom line is, the paper is a valuable part of their lives. When customers start talking about the paper's value in response to discovery questions, they sell themselves.

Quarter-inch holes

It's all about relating features to benefits. Last year, there were probably a million quarter-inch drill bits sold in the U.S., but nobody really wanted the bit, just the quarter-inch hole!

One of the most common reasons for cancellation is when subscribers say, "Well, the papers just pile up. I'm too busy to read it." That's your cue to discover. If you understand what's keeping them so busy, you are better prepared to point things out about the paper that improve their lives. Does the customer work two jobs and can't find time to read the paper? Mention the employment classifieds as a good source for a higher-paying job so she wouldn't have to work two jobs. Is the subscriber too busy to read because he's searching for a house? Mention the Real Estate section. Are you talking to a working mom? Mention the Food section's quick-and-easy recipes. The reader says he can't afford the subscription? Talk about the value of Sunday's coupons. Chances are that the customer will respond, "You know, now that you mention it, that is worth it for me. Go ahead a renew my subscription." And you have the save.

Well worth checking

It pays to ask. In fact, I have seen discovery add millions of dollars to a company's bottom line. My advice is to take a half hour and visit your call center, listen in on a few calls and ask a few questions of your own. Are your reps reaping the benefits of discovery? If they are asking questions, are they the right kind? Could your call center be generating millions more in sales and saves by asking a few good discovery questions? Could be. At minimum it's worth a listen.