Call center, profit center

Sept. 20, 2006
In most pizzerias, if the phone isn't ringing, neither is the cash register. But at Cassano's Pizza King, phone silence is golden.
Three years ago, the 36-unit chain switched to a one-number call center that handles all telephone orders. Vic Cassano, president of the Dayton, Ohio-based chain, said working in a quieter store has made a "day and night difference that's much more conducive to a friendly work environment. Answering the phone was a job everybody hated." (Read also Cassano's Pizza King: A rise, fall and rebirth and Who's who: Vic Cassano.)
The investment

What's Important

U.S. call centers employee 3.7% of the total domestic workforce, but their use in the pizza industry is limited.

In the past, the cost to build and operate a call center made them somewhat prohibitive. But as the cost of that technology declines, a center becomes a more affordable option.

Having a single number customers can call for pizza is a huge marketing advantage, operators say. It's easy for customers to memorize and it lowers print advertising costs.

in the call center was nearly a million dollars. But Cassano said it's more than paying for itself by eliminating busy signals and customer hang-ups after long waits on hold. Better yet, it provides call center customer service representatives (CSRs) opportunities for skillful upselling.
"The first full year after the system was in place, we had a 20 percent increase in business," Cassano said. "And, frankly, I believe a lot of that came from the phones getting answered every time."
Neither Cassano's nor 57-unit LaRosa's Pizza in Cincinnati bore the full cost of the call centers; their franchisees shared some of the burden. To convince LaRosa's franchisees a call center might do them some good, Pete Buscani, executive vice president of marketing, said they played recordings of calls from busy Friday nights.
"You'd hear this voice almost screaming, 'Hi! Thanks for calling LaRosa's! Can you hold, please?'" Buscani recalled. The recordings left franchisees grimacing. "And if there was two minutes of dead air, we let it run until they got back on the phone. ... For about the better part of an hour, they played those conversations, and when it was all said and done, the franchisees said, 'Let's go.'"
Big business
It's likely few know the enormity of the U.S. call center industry. There more than 100,000 call centers in the country, and according to Call Center Magazine, 3.7 percent of the American workforce is employed by a call center —higher than in agriculture.
Yet, the presence of call centers in the U.S. pizza industry is limited to just six brands: Cassano's, Domino's Pizza, Pizza Hut (both are in select markets only), LaRosa's, Rusty's Pizza and Vocelli Pizza.
Such limited penetration makes sense in some respects. To make a call center an affordable investment, a brand needs significant presence of 10 to 30 stores in a single market to benefit from labor savings and the marketing value of a one-number system. Tens of thousands of pizza companies lack this critical mass, but several dozen larger regional chains have the numbers yet don't use call centers.
The cost of a call center is declining dramatically, however, with the use of the voice-over Internet protocol (VoIP), which makes transmission free.
Advanced phone systems also make outsourcing possible, meaning the call center needn't be near the pizza company, even in the same state. Companies, such as McDonald's are testing the use of remote call centers to assist drive-thru customers.
But could a pizza company outsource its call center? Industry expert John Anton believes so.
"I feel that what a pizza franchise needs to do is cook great pizzas, deliver them hot and with good customer service," said Anton, director of Benchmark Research in Santa Maria, Calif. Anton also is an adjunct professor  
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at Purdue University, where he advises on the school's call center program. "What you don't need to be good at is order taking. Why would a pizza company, large or small, build a core competency that's not needed? You can be a great pizza company and not have to build a call center."
Keith Dawson, editorial director for Call Center Magazine, said the skills of a call center CSR are very different from those of the average pizza worker charged with more than answer the phone. CSRs have are focused solely on customer calls, and they're trained in the art of upselling.
Call center CSRs typically also are different from the average guy on the make line. The call center at LaRosa's employs one man who was born without arms, but takes orders with his feet. A septuagenarian LaRosa's waitress, who tired of working on her feet, became a call center worker, and the company employs a handful of workers who take calls from their homes during peak order times.
"We've got one guy in here who has dreadlocks, and I'd never hire him to work in the restaurants," Cassano said. "But here in the call center, he's the ace. He's really good."
Buscani said the skills required for good tele-CSRs aren't as easy to come by as one might think.
"It's a high science. You can't hire them like you do employees for the restaurant," he said. "We've learned a lot, and over time we've found there are certain attributes that make a good CSR."
Central command
Cassano's system allows call center supervisors to monitor the status of every phone order in the system. When a customer calls, the CSR takes the order and the system routes it to the store nearest the customer. If orders pile up at a particular store, call center supervisors adjust delivery times in the system so CSRs can tell customers when to expect their pizzas.
Supervisors also listen in on customer calls to see if CSRs are effective or need additional training. They also handle every customer complaint, which removes the burden of problem solving from the shoulders of store operators. Stan McCabe, chief executive and president of oneSystem, a provider of call center software to several pizza chains, said it's this level of operator interaction that would make outsourcing a pizza call center impractical. Being able to fix problems immediately is essential to good service, he said.
"When it's your pizza business, you do something about it, but when it's your customer's business, it's a lot more difficult to believe they will," said McCabe. "I also think you have to keep your company's culture all your own in pizza. That's hard to do if you've outsourced your call center."
Cassano's supervisors also train regularly on upselling techniques
The call center at Cassano's Pizza King in Dayton, Ohio.
            Photos above and top by Tom Uhlman
to boost check average, and each CSR is graded. Unlike store-level CSRs, who are hurrying to address other tasks, Cassano said CSRs are sales reps whose job is to take orders and entice customers to buy add-ons.
"The basic rule is to never ask the customer a yes or no question," Cassano said. "It's not, 'What would you like?' It's, 'Would you like this or this?' Some people are great at it, they're naturals. And it scares the hell out of others."
Buscani said LaRosa's call center staff doesn't focus much on upselling because the current software isn't designed to facilitate it. However, a completely new system that's in the works will help CSRs upsell when it comes online next year.
"Our current system was built in the late '80s, so it was just built to take orders efficiently and correctly," he said. "The big unknown for us back then was whether we could get the same volume of calls through center as we did through the stores. We needed to ensure we took orders quickly, professionally and correctly. But the new system will do much more."
One-number marketing
A key benefit of a call center is its use of a single, easily recalled phone number for a wide market. LaRosa's Pizza has used a one-number call center since 1990, and 16 years of constantly reinforcing the phone number has nearly everyone in Cincinnati and the surrounding markets programmed to dial it for pizza.
"We have about a 70 percent unaided awareness of the number," said Buscani. In focus groups, when subjects are asked about LaRosa's number, "sometimes they sing it with the jingle."
McCabe said one-number marketing is in Asian countries is even easier than in the U.S. In Bangkok, Thailand, where he lives, the number for the Pizza Hut call center is 1112, and 1150 for KFC.
At Toppers Pizza in Sudbury, Ontario, one-number marketing simplifies printing and keeps costs down, said marketing director Emaan Toppazzini.
"It's great because you're not dealing with black plate changes for every store," she said. "It's much easier to do different promotions. You don't pay as much money and you buy one bundle for everyone."

Topics: Operations Management , POS , Telecommunications

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