Letter from Connecticut

The train ride between Westport Connecticut and New York City is about an hour. I had time on my hands. With pen and paper, I jotted down a few recent observations from my recent stay in America.

Choice. Everyone would agree when I say that America is the land of choices. Spending a few weeks here can turn a cheapskate into a spendthrift. This is the land of Wal-Mart (mega dry goods retailer) and Home Depot (mega hardware store). One phrase I have not come across is "out of stock." On the contrary, there is so much stock and the selection is endless. My wife had to use a crowbar and the threat of death to extract me from CompUSA, Circuit City and Best Buy, all great gadget shops.

I guess these retailers have figured out their supply chains to be able to offer good selection at low prices. Of course, the biggest driver to lower price is competition. With competition, prices drop. (Did I already say we need our phone rates to drop? Hmmm…)

Self-service buying. With labor costs so high here, it just makes sense to use technology to increase productivity, and self-service buying is a continuing trend. It started with the ATM (I have not spoken to a teller since 1982). In the last 20 years, I have not changed much (except for my girth); I still hate queues.

For someone who hates waiting in queues, self-service buying is a godsend. At the deli counter, there is an express deli kiosk where you can order your meat or cheese. I ordered my ham, specifying the thickness of the cut and the weight, without speaking to the butcher. The kiosk spit out a number. I finished the rest of my grocery list and came back to find my ordered filled with no time wasted. No queue.

I was amazed at the self-service checkout counters. You scan the groceries yourself; they even provide a weighing scale to handle produce without barcodes. You then pay with cash, credit card or debit card. No queue.

At the train station, I bought my ticket at the platform from a ticket kiosk. (Buying the ticket from the conductor would cost me an extra 30 percent). I did the same at the subway. No queue.

At the gas station, you fill up yourself and pay with credit card, debit card or Speedpass at the pump. Cash has to be paid to the cashier inside the high-security glass though. No queue.

Method of payment. People still use cash but that is quickly changing. Debit cards and credit cards are getting a bigger share of the wallet. There is even a new product called the check card for virtual check. Some cool new tools of payment are the Speedpass wand, Discover 2 go card and our very own Smart Money card.

Speedpass is a cool new gadget to pay for gas at Mobil stations. It is a small wand of about two to three inches which you wave in front of the gas pump. It uses RF (radio frequency) technology very similar to the Octopus card in HK.

The Discover Credit Card Co. has redesigned its card to fit your front pocket. It is also designed as a money clip and key chain, with the same magnetic strip. I guess this saves the user time from pulling out his wallet, since he is getting his car keys anyway.

Another intriguing use of technology is the Smart Money card (but not promoted in the US yet). Created by the people at Smart Communications Phils., the Smart Money card is a stored value card similar to a prepaid card but can be used at all MasterCard outlets worldwide. A unique feature is its ability to be reloaded using the cellphone. You can also send money to another Smart Money card via texting. I sure hope this catches on worldwide to prove that the Philippines can produce smart applications.

I was on the lookout for cellphone-vending machines but did not find any. Then again, it might be few and far between since there are so many cellphone platforms (i.e. CDMA, GSM and NTT) in the US; it may not make sense for vending companies to switch yet.

Online bill presentment. Now that you bought it on credit, it is now time to pay for it. I dislike getting bills, not just because it means I owe someone money but the mere activity of opening envelopes is annoying and bills in general are environmentally wasteful. I dislike waste as much as I dislike queues.

I just think bills damage the environment not to mention my wallet. Bills need to be printed, inserted into an envelope, and mailed. The total costs of the billing process add up.

Introducing Paytrust, an online bill presentment service. For $5 a month and 50 cents per transaction, all your billers send to Paytrust directly via electronic file and Paytrust serves it to you online. For billers who cannot do it digitally, the physical bill is sent to Paytrust and scanned. Great service but I think the subscriber should receive a discount to use this service as the benefit is to the biller. Paytrust should be charging the billers since they enjoy savings in printing, envelopes and stamps.

‘Do Not Call’ registry. Telemarketing is a huge business in the US. However, for some consumers who are bombarded with these calls throughout the day, it remains a big annoyance. The phone companies are making more money from value-added services such as call screening and caller ID.

The US federal government recently tried to address this problem with a national "Do Not Call" registry. Telemarketing companies are now required to subscribe to this list and are penalized if they call someone on the list.

I am not sure this bodes well for the Philippines’ contact center industry, which is already experiencing a margin squeeze from too many new players and increasing labor costs for experienced customer service representatives (CSRs).

My Two Cents: Maybe we can learn. However, we should not follow in the footsteps of the negative like the corruption scandals of Imclone/Martha Stewart, Enron, Worldcom, Adelphia and so on. Then again, if the allegations of the Magdalo group are proven right, some corrupt US politicians can learn from us. I surely hope not!!

2nd Two Cents: At the risk of sounding like Chicken Little, our window of opportunity for IT-enabled services is closing. I just read an article in the latest BusinessWeek that China is building up software development and call centers with a team of thousands to serve US outsourcing needs. Then again, China might need it for its own back-office needs.

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Dickson Co is CFO (C is for Cheap) for Dfnn, Intelligent Wave Philippines and HatchAsia.com. For comments or suggestions, e-mail [email protected].