 |
 |
 |
 |
 |
 |
 |
Shopping Centers Today -> May 2002
 PRINT THIS STORY: |
  CHANGE TEXT SIZE: |
|
SHOPPERS’ CALLS BRING AD OPPORTUNITIES FOR MALLS
By Dave Bodamer
 |
Chances are pretty good these days that when customers call a regional mall, no matter where it is located, they’ll be talking to the same people.
CD Communications Service, Newport Beach, Calif., has taken a big chunk of the market on shopping center phone systems, answering the calls at more than 25 percent of the regional malls in the United States. But not only do such systems answer the phone, they also offer some lucrative marketing opportunities.
Right now about 400 of the nation’s approximately 1,500 regional malls use CD Communications’ system, including those owned by Glimcher Realty Trust, JP Realty, The Macerich Co., Simon Property Group and outlet centers Chelsea Property Group and Prime Retail, among others. Last year the company handled 18 million calls a year.
“We have them at all of our shopping centers,” said Randy Lawsing, senior vice president at Prime Retail, Baltimore. “People would call for a lot of basic information like store numbers and mall hours. It eliminates a lot of calls and frees up our staff to do other things.”
CD Communications estimates that a 1 million-square-foot regional mall receives an average of 80,000 phone calls a year, most of which are for information that does not require a live person, such as the phone number of a specific retailer.
To answer such questions, malls use an automated answering system similar to those in many offices. A caller is presented with menu options that can be customized to each center, but that generally include basic information such as a mall’s business hours or schedules of special events.
It also provides a direct connection to a store or to the management office.
But such systems can do a lot more than simply help malls and their customers save time; they can be used for advertising, too.
The system invites customers to leave their e-mail addresses, enabling management to create databases for direct marketing.
“We can generate reports in terms of caller ID information,” said CD Communications’ president, Chris Dunk, explaining that the system can be used to help owners focus their marketing. “They’re just now getting to know who their shoppers are and singling them out as individuals. We can help them with that.”
Mall marketing managers then use the databases to analyze the customer base and for direct e-mail marketing campaigns, Dunk said.
CD Communications provides reports for malls and advertisers detailing how many people called the mall and what they were calling about. If, for instance, reports show that a significant portion of callers to a center are looking for J.C. Penney, the company can use that data to persuade Penney to purchase advertising time on the system.
“In terms of marketing applications, it certainly has an excellent business platform for those seeking a direct message once they call the center,” said Scott Burchard, senior vice president of business initiatives at Macerich, Santa Monica, Calif. “We are exploring opportunities right now relative to leveraging that customer base and distributing those messages that an advertiser is looking to convey.”
Among other places, advertising can be placed at the front end of a call. In the case of CD Communications’ system, revenues would be split between it and the mall.
When it comes to the promotional aspects of the technology, CD Communications is only now reaching the critical mass of calls necessary to interest national advertisers. A few years ago it was handling about six million calls a year — not enough to entice such companies as Dillard’s or Sears to advertise. But now that it is handling millions of calls a year in hundreds of malls around the country, the door to more advertising opportunities has opened.
“What we’ve done is gotten to the point where a lot of mall managers are familiar with our company,” Dunk said. “The managers in the business typically move around within other companies in the industry. What I typically say is, ‘Have you heard of our system?’ If they say no, then I refer them to a neighboring property that may have the system. We’ve been able to build the company through a lot of reference and referrals.”
What it can do now, though, is handle those phone calls. Not only does the system improve communications between customer and mall, but it also helps shopping center managers stay in touch with their tenants. They can deliver voice messages to all the tenants at once, for example. Similarly, a manager can phone the system from home and update a message to inform staff and customers alike about, for instance, early closings in the event of severe storms or other emergencies.
CD Communications would not provide specific pricing details. Cost varies depending on the size of the mall, the sponsorship fee split and the complexity of the system desired, but pricing starts with a $300 basic installation fee. In most cases, malls pay a monthly fee for the service. Installation usually takes about three weeks from the time a client decides to sign onto the system. CD Communications also makes its technical support staff available 24 hours a day — most changes to the system are made from the company’s headquarters.
If a menu needs to be changed or the store roster needs updating, a mall manager can have the message prerecorded or edited and then downloaded to the center over the Internet. Such changes can be completed within a day.
Dunk and partner Rick Edwards founded CD Communications nearly six years ago. Dunk, a former professional tennis player, came up with the idea for the company while exploring another venture. Edwards is an investor with a background in growth financing and leveraged buyouts who has provided capital to get the company going.
“My partner and I, when we started the company, originally set it up to be an interactive job line in the Orange County [Calif.] area,” said Dunk. “What happened is that we were pretty successful, but soon we found ourselves competing with the local newspapers [that] eventually shut us down. At the same time, we saw an application of the system for the shopping mall environment.”
Dunk and Edwards brought the system first to Cerritos Towne Center, Long Beach, Calif., which needed a customer-service line during its renovation. The mall management used the system to leave updates on the status of construction or general information whenever parts of the center were closed.
“From that one site we approached a number of developers and started placing the system all over the country,” Dunk said. “From one here to one there, we’ve gradually grown to what we have today.”
CD Communications says it has no major competitors right now — last year it acquired the largest similar company, MallFone, and integrated the two companies’ portfolios.
The company works only with mall developers and has no clients in other industries.
“I see our business growing and growing,” Dunk said. “We can double in size in the next four or five years.”
 | Current Issue February 2012 |