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Rich Tehrani

Offshored To Death

By: Rich Tehrani, Group Editor-in-Chief,
Technology Marketing Corporation


 

Will offshoring be the death of some American companies? Perhaps not, but what if intelligent competitors playing on the inherent patriotism of the American public were to begin using anti-offshore outsourcing sentiment as a way to take customers away from those companies that do outsource their support departments to other countries such as India?

Dell is one of the more famous case examples of a company using offshore outsourcing. Anyone who reads the business news has heard stories about the many Dell customers who are unhappy with the level of service they are receiving from the Texas-based PC giant.

This environment has presented a perfect opportunity for companies like MPC Computers (www.mpccorp.com) to start advertising campaigns targeted at people who are sick and tired of dealing with offshore help desks. A new ad from the company has the following headline: 100% U.S. Based Service And Support (see Figure 1.)

I don't think I had ever heard of this company before I saw this ad. Whenever I hear of a new company, I go to Alexa (www.alexa.com), a company that tracks Web traffic of all Web sites. Alexa ranks the sites based on their overall popularity in terms of traffic.

Here is where the competitors rank:

As of 8/21/05

      Company        Rank (lower is better)

      IBM                   240
      Dell                     64
      HP                    129
      Gateway       1,946
      Apple                  67

MPC Computers ranks in the top 74,246 sites in the world.

To put this in perspective using another Alexa metric (tmcnet.com/163.1), you can ascertain that Gateway Computers gets 56 times the traffic of MPC. Not very impressive for MPC Computers, but its traffic (tmcnet.com/164.1) is getting better. Perhaps these ads will help it grow faster.

This is the first ad I have ever seen like this, so I contacted the company and asked a laundry list of questions that were answered by Ross Ely, Vice President of Corporate Marketing for MPC Computers. I started by asking what the response has been to this unusual ad campaign. Ely said, 'We have been very pleased with the reception to our '100 percent U.S.-based Service And Support' ad campaign. Just as you suggest, we find many PC users are frustrated with the poor service they receive through our competitors' offshore call centers. We conceived this campaign to tap into this dissatisfaction and inform these users that there is a better solution.'

I also asked how his company can compete with the other, much larger, computer companies in the market. I was thinking (but didn't put it in my question) about all the PC vendors that were once around in the 1980s and are now gone. I remember those good old days when I personally assembled all of TMC's PCs from components purchased from JDR Microdevices. At a certain point, the economies of scale of the larger companies allowed them to price their finished computers quite close to what it would cost to assemble the computer yourself. Once that happened, the competition in the market really dried up. This is what Ross had to say on the subject:

'MPC Computers is one of the top 10 companies in the U.S. PC market, and we compete every day against the 'big boys' you mention: Dell, HP, Gateway, Apple, IBM and others. We focus on the specific market segments of government, education and midsized businesses, and target all of our marketing to address these segments. Our primary differentiation from the big boys is in service and support; we strive to outperform our competitors in areas like the quality and responsiveness of our tech support reps. Our biggest challenges in competing with the big guys are economies of scale (pricing) and brand awareness.'

I have seen numerous surveys that show customers value saving money more than supporting fellow U.S. workers. I asked how the company has dealt with the issue of price-sensitivity versus supporting American workers. Ross' answer:

'Our overall perception is that customers care a lot about service and choose vendors they can count on in the long run. However, they are also very sensitive to price. Our goal is to get them to think longer-term and consider service attributes in addition to price when making their purchase decisions.'

Notice what is happening here. The perception in the market is that offshore service, at least in the computer market, is the same as having bad service. By pushing the fact that service is 100 percent American-based, it is perceived to be better. Rather than having to make customers choose between supporting American workers or keeping prices low, the value proposition has shifted to pay a bit more and get better service.

I asked how the ad campaign is working, and if other companies can take advantage of the 'service and support in America' idea to gain market share and increase their businesses. Ross' response:

'This advertising is one of many vehicles we are using to communicate our value proposition. While we have been pleased with the results of the advertising (as measured in calls and Web hits), we need to use many other types of marketing to generate awareness and leads. I would advise others that 'Made In The U.S.' advertising themes can create a positive atmosphere around their brands, but that complete, integrated marketing programs are also necessary to gain the maximum return from their marketing investments.'

I didn't expect that integrated marketing line. Nadji Tehrani has been preaching integrated marketing in his columns for months, if not years, and it seems that others agree that this concept works well.

Getting back to the American service and support debate: at the moment, service and support in a variety of other countries are considered to be far inferior to those in the U.S. You have two options. You can offshore your service, but if you do, make sure the quality is second to none, because as soon as a customer hears an accent he or she may be turned off. Sure, I know what you're thinking: America is a melting pot. What's wrong with accents?

I cite the following as a single example of what I'm getting at. Studies have shown that many people in the South don't like to be called by people who have Brooklyn or other New York accents ' they much prefer to deal with someone with a Southern accent. Believe me, Mumbai isn't an improvement over Brooklyn when your customers call from Mississippi. (By the way, I would love to have someone send me an MP3 of a support conversation between someone from the Deep South and someone from India. If it isn't worthy of Jay Leno, I don't know what is.)

The second item is to keep your service and support in the U.S. and advertise that fact. Market it everywhere. Make a banner that says '100 percent USA Support' and plaster it everywhere you can: on your Web site, on the t-shirts you print, on the pens you give out at shows, and on your business cards. Plaster it in your lobby and all over your building. In addition to making U.S. customers happy, you will make your U.S. workers feel happier about themselves, and they will likely be more motivated and productive. CIS

Sincerely yours,

Rich Tehrani
Group Publisher, Group Editor-in-Chief
rtehrani@tmcnet.com


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