How the world has changed: TeleTech buys The Peppers & Rogers Group

I was a part of The Peppers & Rogers team here in the UK at the turn of the century.  That is where I met some of the people who I find to be the most passionate about advising and assisting companies in creating sustainable competitive advantage through customer-centricity.

At the height of the dot com collapse I left Peppers & Rogers – as did some of my colleagues.  Yet, I have continued to follow the company as I have fond memories and am in agreement with what the company stands for: a customer centred approach to doing business.  So it is with interest that I read that TeleTech have bought 80% of The Peppers & Rogers Group.

What I find it interesting is that Peppers & Rogers has not been bought by a marketing agency. It has been bought by a company that specialises in outsourcing including Customer Management Outsourcing.  How times have changed!

When I worked at Peppers & Rogers (200 – 2001) I would never have imagined that things would turn out this way.  Those were the days of CRM.   At that time we did almost all of our consulting for the marketing function – typically the marketing director or the CMO.  Occasionally we did work for the Commercial Director and even the odd CEO.  Yet, the people who were in the driving seat were the marketing folks.

At that time I always envisaged that if anyone would buy Peppers & Rogers it would be a marketing agency.  And at the end of the dot-com collapse the UK arm of Peppers & Rogers was sold to Carlson Marketing – they used to own the Peppers & Rogers brand name in the UK but now it is branded Carlson 1to1.

CRM fell flat on its face because too many people in business are looking for the quick fix – the silver bullet – and the software companies (like Siebel) were happy to provide it.  Out of the ashes of CRM arose Customer Experience.

Today we live in the age of Customer Experience and in this age the marketing function is not the most important one.  Not by a mile – customers rarely decide to continue doing business with a company as a result of the advertising nor the direct mail pieces that land in the letter box.  In the age of Customer Experience the Customer Services function (and contact centres in particular) play a primary role: depending on which survey you read, some 70 to 80% of respondents claim their decision to stick with or leave a supplier is based on the service that they receive.  And a significant part of that service comes out of the contact centres. So it makes perfect sense that TeleTech has purchased The Peppers & Rogers Group.

I want to make it clear that I am not against marketers, the marketing function or even advertising.  Whilst I passionately believe that marketing and marketers have to embrace a completely new paradigm I also get the value that good marketing creates.  Good marketing contributes to the customer and adds to the bottom line.

One role of marketing – indeed advertising – is to add stuff that customers want and which is not in the product itself.  Think about the classic USA adverts for the Volkswagen Beetle – they took an odd-looking car and made it sexy.  Think about the Avis advertising – it took a number 2 position and made it into a virtue: we are No 2, we try harder.

Some brands – especially luxury brands – depend critically on good marketing: customers are buying status and the marketing has to continue to create that status.  Automotive insiders tell me that the quality of Honda cars is just as good as anything on the market yet no-one looking for status buys a Honda, they buy Mercedes, Audi, BMW….

Author: Maz Iqbal

Experienced management consultant working at the intersection of strategy, customer, and technology. Combine a tendency to think strategically with a penchant for getting my hands dirty at the coalface of implementation.