Building Business From a Telephone
Image: Amit Verma
t’s 9.30 am on a Monday morning and the phones start ringing. “Good morning uncle! May I have a minute of your time?” says an overenthusiastic voice in Hindi to someone in Jhansi, Uttar Pradesh.
Seconds later, an elderly lady answers her phone in Jalandhar, Punjab, and is greeted in Punjabi, “Good morning, grandma! I’m calling from Bharti Axa. Does your son have insurance?”
And in Visakhapatnam, Andhra Pradesh, an SUV-driving farmer gets a call in Telugu, “Good morning sir! I’m calling from ICICI Prudential, and you are one of 50 people short listed across India by us for a special offer.”
In town after town, the calls keep coming. By the time the month is up, 7-8 million Indians will have received such calls. Each of these calls can be traced back to one of 2,600 youngsters equipped with nothing more than a stack of printouts and a telephone. They work for NetAmbit.
The Kings of Non-Affinity
With over 4,000 employees, NetAmbit bills itself as the largest “non-affinity based direct sales model” for distributing financial products in India. “Affinity marketing” means marketing products to new consumers on the basis of their past buying patterns or interests — for instance offering international roaming plans to members of airline frequent flyer programmes.
In NetAmbit’s case the opposite, “non-affinity”, simply means selling to people whose needs and preferences you have no idea of. Meaning, NetAmbit is the undisputed leader in India at cold-calling anyone and selling them financial products. It is 5-6 times bigger than its nearest competitor in the space, says Tarun Chugh, executive vice-president and head of sales and distribution for ICICI Prudential Life, India’s largest private insurer.
“They can sell anyone, anything. If I could give them my leads they could do a better job than me!” says Yashish Dahiya, founder and CEO of India’s largest Internet-based insurance aggregator, Policybazaar.com.
For the year ended March 2010, NetAmbit sold insurance policies worth Rs. 450 crore, of which new policies accounted for Rs. 200 crore. Girish Batra, 44, its founder and CEO, says this was 12 times what he sold just three years back in 2007, and will become Rs. 800 crore within the next year. His income by way of commission on these sales was Rs. 90 crore which he projects will become Rs. 185 crore by next year.
Inside the Calling Machine
It surprises many people that NetAmbit is the only company in India that has achieved success in selling financial products over phone. Because, they feel, there is nothing unique to either their market (India’s massive middle class), their products (commonly available third-party financial products) or their business model (telesales). What then is its secret?
NetAmbit relies on its relentless focus on keeping costs extremely low, building and maintaining large volumes of business, and staying disciplined at every operational aspect. Its call centres reside in mundane buildings; there are no computers or fancy automated diallers on employee desks — just a phone and a stack of printed telephone numbers.
“The problems with selling financial services in India lie predominantly around the ability to reach and distribute products on a low-cost basis to tier-2, tier-3 and tier-4 towns. It’s very fragmented, run by individual agents, yet offers large commission pools and a corpus that keeps growing rapidly every year,” says Vishal Gupta, managing director, Bessemer Venture Partners, one of NetAmbit’s investors. “NetAmbit has cracked it with low costs and good margins.”
Of the 7-8 million people that NetAmbit’s telecallers speak with, less than 10 percent end up speaking for two minutes. And only a fraction of those might be interested in the sales pitch. Those that are — “prospects” — are immediately passed on to senior, more experienced callers who carry on the conversation to better gauge profiles before selling them specific insurance or pension products. Once the prospect indicates willingness to purchase a product, the call centre team fixes up an appointment for an on-ground salesperson to visit them and pick up the documentation and premium payments. This entire process might span a period of up to two weeks. It is the quality and timeliness of these hand-offs between various employees culminating in a sale that sets NetAmbit apart from many competitors.
“What NetAmbit does is not rocket science, yet they maintain very high standards of differentiation. Their entire system is designed for recruitment, training, sieving out below-average performers and nurturing performers. Their call centres don’t have high tech, but have a very visible celebration every hour when someone sells a policy or a public firing when a mis-sale is identified. I would say they have created a very extreme Indianised call centre process with a lot of ‘show-and-tell’,” says Chugh.