They've Got Your Number
Electronic directory assistance services are essential everyday tools for collectors. How are they changing in an Internet world?
By Elayne Robertson Demby
Electronic directories can save collectors time and money in locating debtors who have moved without paying their bills and left no forwarding address. While voice operator directory assistance has been available for a long time, its usefulness was limited because, unless a collector knew the town and state the debtor moved to, there was no way to discover the debtor's new number. And operator assistance is costly - more than $1 per query in some parts of the country.
So when electronic directory assistance services came on the market in the early 1970s, it was a tremendous boon to the collections industry. EDA is a now a mature industry, but one that's adapting to rapid change - including the increasingly prominent role of the Internet and the demand for information on a national and even global scope.
David Moyer, the manager of National Revenue Inc., in Columbus, Ohio, credits a switch to an EDA service three years ago with being one of the factors in his agency's rapid expansion. "Without the electronic directory assistance service, it would have been extremely tough to have expanded as much as we have," he says. His firm sends Acxiom Telephone Data Products, based in Little Rock, Ark., 10,000 to 15,000 accounts a day that need updated telephone numbers and addresses.
They are returned the next day, with the information automatically plugged into the firm's system. By eliminating manual labor for dialing 411 calls and entering data, Moyer's firm saved "tons of money."
While the pace of change in mature industries is generally slow, the Internet and the globalization of the economy has forced EDA service providers to rethink their business strategies. "The Internet has provided access to more potential customers," says Greg Ford, vice president of sales and marketing for DirectoryNet Inc., Alpharetta, Ga., which merged with another EDA vendor, Find America, in May 1999. Before, Ford says, customers had to either dial up and pay significant charges, or have a dedicated line. Now, he says, there is no added phone cost for the EDA service if the customer has Internet access.
The Internet is clearly the state-of-the-art way to provide directory assistance, agrees Gerald Venner, vice president of sales for BusinessCreditUSA.com in Omaha, Neb. The Web not only empowers the user to take control of the search, instead of relying on potentially fallible directory assistance operators, it can also offer far more information related to collections and credit, he says.
Indeed, the growth in Internet use has led to the development of EDA services provided exclusively in cyberspace. InfoSearch International Inc., for example, launched a new product called EQuickData.com at the end of October. "It's an Internet-based product that is the largest aggregation of consumer data for the collections and credit industry," says InfoSearch's Thom Thompkins, based in Atlanta. To use the product, a customer registers at the website, and obtains a password and identification number. The cost of finding a phone number ranges from 25 cents to 35 cents per number, depending on volume; address searches are 15 cents to 25 cents each.
While the move to the Web is one of the biggest changes in the industry, another is expansion of data that EDA services provide, says Venner. BusinessCreditUSA is a wholly owned subsidiary of InfoUSA, a $350 million public company that has been in the database compilation business for 29 years. "We bring data in whatever form is most convenient to the client, whether you want access via the Web, CD-ROM, or printed directories by state," he says. Clients can search for a debtor by name, phone number, address, or fax number.
In addition to the traditional data provided - name, address, and phone number - EDA services are expanding the range of information that clients can obtain. "The EDA services that survive will be those who can provide more information as part of their service at the same cost as before or slightly less," Venner predicts. "[We're] trying to open up ways that people can execute queries - to expand the ways that they can ultimately find what they're looking for," he says. For example, a creditor looking for a corporate debtor can ask for neighboring businesses to contact. Business CreditUSA can also provide a list of a debtor company's top executives. "Instead of getting the runaround, you can go directly to the key executives of the company," says Venner. "A letter to the president of the company from an attorney gets more response than an anonymous letter to the black hole of accounts payable."
InfoSeach's new product offering, EQuickData.com, also expands on its EDA services. It was developed in conjunction with credit and collections scoring companies to provide scoring mechanisms, Thompkins explains. So, at the front end, if a consumer is submitting an application for a loan, a creditor can obtain a score indicating the likelihood the consumer will repay the loan. At the back end, if the loan goes delinquent, another score can be run indicating which collections agency that account should be sent to, he says. In turn, that agency can obtain a score showing the likelihood of collecting on the debt.
From a collections standpoint, having access to richer sources of information is becoming extremely important as collections become more and more automated, says Venner. "Collections companies are looking to automate data so that their collector is armed with data prior to making a call, as opposed to having to handle research manually." Service provided by his company can also help a creditor perform due diligence. "The key question," Venner says, "is how do I quickly and inexpensively get enough information on a company?" For approximately $3, a company can pull a report on the debtor firm's stability and creditworthiness - which is a lot less than what would have been spent on labor to do the research, he says.
A Competitive Edge
And EDA services are realizing that clients need to have access to, at a minimum, nationwide data, not just from a particular region, to track down debtors. Acxiom's InfoBase allows a collector to search for a debtor anywhere in the U.S. and Canada, says Riggins, and the data is updated monthly or quarterly depending on the type of delivery system the client has.
Denver-based Qwest Communications International Inc., formerly U.S. West, is another company that recognizes the need to provide EDA services on a national level. "Effective January 1, 2001, our electronic directory assistance product is going from a regional database product to a national database," says Aaron Smith, director of billing and database services.
Qwest made the move, he says, because customers are asking for information on a national scale, and from one source rather than a number of regional databases. "It also broadens our customer base and enhances our relationships with existing customers," he says.
Indeed, further expansion is likely, and it too will be driven by customer demand. "The market is moving to a global focus, and therefore the industry needs to go global," Smith says. Quest plans to position itself as an international EDA provider as soon as it can determine the best way to offer the service in as reliable a manner as possible, he says. "We wouldn't offer products if they didn't meet our quality standards," he says.
The EDA industry as a whole, he adds, will go global as more customers look for information to be provided on an international basis.
Going the extra mile means helping client companies enrich their view of their customers, such as determining whether an individual subscribes to land-based as well as wireless telephone service. It also involves providing consulting services. "Acxiom helps clients understand the nuances of consumer privacy laws so that they can use data correctly," says Riggins.
DirectoryNet, too, is focused on customer service. "We specialize in integrating our electronic directory assistance application with the customer's application," says Ford.
And the quickness and quality of information updating is becoming more important, says Smith, whose firm updates its database daily. "There's more churn, in general," he explains. "People are moving more frequently, so the need to have the most current information is increasing." EDA services may be a mature industry but, with customer demand swelling for integrated services on a broader geographical scale - and at a lower cost - it's hardly a static one.