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Interview with Mike Faith of Headsets.com

Drive-You-Nuts.com

Mike Faith from Headsets.com explains below how Customer service has been a cornerstone of the company's business strategy. By providing superior service to its Customers and paying attention to the needs of its employees, Headsets.com has been able to achieve substantial growth in the business over the last six years.

Q: Can you tell me a little bit about Headsets.com?
A: We've been in business nearly six years and as our name implies, we sell telephone headsets. 95 percent of our business is telephone headsets for offices, which is our main market. We have 19 employees, and sales in 2003 were around $11 million.
Q: Can you tell me about your own background and what led you to start the company?
A: I am a serial entrepreneur and I can't help doing it. This is my third venture in the U.S. and we started on headsets in a previous business. We were using headsets and the quality was poor and they kept needing repair. I thought this doesn't make sense for the cost of these and the quality we're getting. Something wasn't right in this equation so we started sourcing headsets in the Far East and that was six short years ago and we've built the business since then.
Q: So what makes Headsets.com unique?
A: First thing is the domain name and it's a great domain. We leased it from a competitor and it's really helped us in terms of people recognizing us and realizing right away what we do. That sets us apart in the mind of the buyer as a specialist in that market. But perhaps more important even than that is our high level of Customer service. We have a very, very high focus on Customer service and when people call us they tend to feel that and experience that and our goal is to keep them as lifetime Customers by really serving them superbly.
Q: How many Customers do you actually have now?
A: It's about 73,000 and nearly all of those are US businesses.
Q: Is it mostly corporate accounts, or individuals, or maybe a mix of both?
A: It's mostly corporate accounts although we get individuals at companies buying sometimes. We don't market to people at home. Occasionally, we'll take orders there where someone will want to add a telephone headset for home, or a cell phone headset for use in their car. But our prime market is to businesses where sometimes we'll be dealing with a corporate buyer buying for the whole company. Other times we'll be dealing with individual departments buying a small number of headsets for their department.
Q: Where do most of your Customers come from? What is the main the source of your business?
A: We mailed 7 million catalogues in 2003 and that's had a pretty big impact in making the phones ring and getting people to come to our web site. But more and more of our Customers are both repeat Customers and referral Customers . By delivering a high level of Customer service not only do we encourage them to come back to us but we find that if we deliver exceptional Customer service rather than just good Customer service it really stands out and we get a lot of referrals because of that.
Q: You mentioned Customer service a couple of times and it sounds like it's a cornerstone of your business strategy. But how do you actually know whether your Customers are satisfied or how satisfied they are?
A:

Good question. It took us a while to work that one out . Our most effective method now is to include in the box with every purchase a survey with a $10 off opportunity if they complete the survey. The survey asks a small number of questions, in particular how was their experience with the Customer service rep, and we rank our Customer service reps based on the results that come back from there.

The only thing we're interested in is if the Customer picks excellent. If the Customer picks good, then it's not good enough and we've got a problem there. We haven't really exceeded all expectations. During the past 2 to 3 years we have really managed to focus our reps on wanting to achieve very high Customer service rankings, i.e. the feedback from the Customer . And for us that's the most important measure of how we're doing.

Q: Why is Customer satisfaction so critically important to you? Why do you seem to put it at the top of your list?
A: I think if we satisfy our Customers rather than go for the short term plan of how much we can sell them right away or how quickly can we process their order, I think that in terms of Customer satisfaction we sacrifice the short-term gain. But in return we get the long-term growth and the long term Customer base and for us that's far more valuable. And at any instant if we decide to defocus from Customer service, and process calls quickly to see what we can sell people in the shortest amount of time I think we would get an instant impact on higher profits but I think it would be short lived. And it's the longer term growth of the business that's important to us. There's another reason as well Ron which is I love good Customer service and I hate bad Customer service. I'm a bit of a Customer service nut myself and in addition to the business side, I think it is the right thing to do. I actually feel good that we give such great Customer service and in the company meetings we read out the surveys that the people have sent back. Some of the things they've written I feel really proud of such as what we do for their companies.
Q: It sounds like you're really taking the long view which is an important thing, but the front line employees in any company can make or break even the best intentions of a management team. What process do you use to select and train the Customer service reps to deliver on the promises you're making?
A: Well we've kind of honed our hiring process over the past few years. We generally interview about 30 people in order to get one successful person on the phones. And we place a lot of emphasis on their personality type in terms of their ability to want to please people and also their patience. We want someone that is able to listen more than talk and we find that by running a three or four interview process we are able to screen for the right people. And it's the personality and the emotional tendencies of the person that are far more important to us than the level of experience that they've got.
Q: Now I understand that you use a business psychologist and even a voice coach to train some of the Customer service representatives. Can you tell me how that approach works for you?
A: Sure. People often find this one unusual. We've got a business psychologist that most of our Customer service reps speak with regularly. They talk with this person in the training process and as an ongoing career development process. And most of our reps find that very successful in terms of meeting their goals and really focusing on how they can best deliver those goals over the phone. I actually work with the business psychologist over the phone which is great because it's a training session itself in terms of the phone call and I get general feedback on how the reps are doing as a group as well. The voice coach we work with is actually in Australia and the beauty of working with a voice coach is that it is the phone that we're training for. We located one of best voice coaches in the world in Australia and he's has been working with our reps for over a year now . He has a real impact and many of the reps speak with him once a week or once every two weeks and find they get a lot of value in how to use their voice tone to give the best Customer service.
Q: Now besides the web site, of course, a lot of the orders must be coming in over the phones. What have you selected for a phone system?
A: We've got Avaya IP office phone system.
Q: That's a new system with a lot of features. How do you make sure your Customers get routed to the right person without getting into long voice mail trees, something that happens to me all of the time?
A: Simple. We turn the voice mail trees off. We've got a system that enables us to do a lot, with voice mail trees and an automatic operator. We decided, however, to turn it off so when you call our company you actually get a person answering the phone. Our goal is that in over 90 percent of calls, the person who first answers the phone is the one able to deal with or resolve whatever you're calling for: whether it be to buy a headset, to ask questions, to solve a problem, to make a return, to pay a bill, or anything else within the company. We think that it's important with Customer satisfaction too. When you call, you get an answer and you are able to work with one person to get what you need.
Q: So when the Customers are on hold, how long do they typically have to wait if it gets backed up a little bit?
A: Our goal is 98 percent of calls get answered within four rings by a live person and we staff appropriately for that. Although that costs a little more to do, we think it's by far the right thing to do, so very rarely does anyone have to go into a hold system. We look at our logs daily to see how well we're doing on that and to make sure that less than two percent of calls go on hold. For those that do go on hold, if you're one of those 2 percent, the average is about 45 to 50 seconds on most days. Chances are you get a live answer first time though.
Q: Well it sounds like you have made Customer service the overriding theme of the company. Can you comment on how this has translated to measurable business results because a lot of people don't necessarily see that as a strong tie in?
A: In 2001 we had revenues of about $3 million. In 2002 it was close to $7 million. In 2003 it's going to be around $11 million. And we're anticipating growth of just over 50 percent in 2004. Sure, Customer service is not the only driver of that, but we believe that it's a primary driver. We've done this at a time when, as you know, many companies have actually been going backwards in terms of sales, particularly sales of business hardware.
Q: That's outstanding. Besides what we've covered already can you think of anything else that's unique in your approach to Customer service that might be of interest to our subscribers?
A: Yes. We believe in having a lot of emphasis on the Customer service people. I really think I have two groups of Customers : my Customers and my employees. We put a lot of emphasis not only on the selection and on the training of Customer service people, but on their retention and their happiness in the position as well. We've got very low turnover for a call center. Many of our Customer service people have been with us for two or three years. And generally people don't leave. I think by paying our employees a little bit above the average, by going that extra mile on looking after your Customer service people, by giving them a little bit more time and attention, they're prepared to do the same with Customers . It's a circle that comes back to us.
Q: Certainly impressive results. It's obvious that you're doing something right. How can people get in touch with Headsets.com besides the obvious web site if they want to experience this kind of great Customer service for themselves?
A: That's the kind of the question I really like. Headsets.com is the domain name that people can find us on the web and our toll free number is 1-800-HEADSETS (1-800-432-3738).

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