Teledirect targets Vietnam, I'nesia

The Nation (29 October 2007)

New division aims to help Thai banks boost fee income

Teledirect, a leading regional provider of telecommerce services, is set to expand into Indonesia and Vietnam within the next two years. The company currently has call-centre operations in four key Asian markets - Thailand, Malaysia, Hong Kong and Singapore - and recently set up a new division, Teledirect Consulting, to provide clients with strategic advice and support in the field of telecommerce and act as business partner.

"In the next two years, we expect to have something in Indonesia and Vietnam," said CEO Laurent Junique, adding this would involve both call-centre operations and consulting services.
Indonesia is a market with a large credit card base, though the revenue per card is quite low, and with very few third-party call centres like Teledirect, he said.

He said Teledirect wanted to be the pioneer of telecommerce services in Vietnam, as it was in Malaysia, Thailand and Singapore, adding that the company believed in the first-mover advantage.

Vietnam is a different market and less advanced than Indonesia, Junique said.

"Many clients who come to us are in the financial sector, both insurance and banking. In Thailand, for instance, about 95 per cent of Teledirect's revenues are from insurance and banking customers. Every client needs to increase revenue every year and it is the duty of Teledirect to help them," he said.

Junique said Teledirect would invest heavily in its first phase of development to expand its sales-acceleration business and take the leading position in this area in the next three years. The focus in the next phase of development will be on customer services, he said.

"Our customer-service business was launched in Singapore last year. Major clients include airlines, which outsource customer-service functions such as ticket booking and reservations to us, and luxury-goods manufacturers, which have appointed us to take care their customer-service function for the whole Asia-Pacific region," Junique said.

He said that while Malaysia has been promoted as Teledirect's operational headquarters for its call-centre business, Singapore is the leading test market for its customer-service initiative.
Jeffrey Manuel, business director of Teledirect Consulting, said the setting up of the new division was linked to the economic environment in Thailand.

He said the insurance penetration per capita in Japan was US$3,700 (Bt126,000) and $1,600 in Singapore, whereas in Thailand it is as low as $80.

"So there is a lot of opportunities for growth in this region, mainly in developing countries such as Thailand where the government is opening up and liberalising the financial sector, particularly banking and insurance. The move will go together with higher awareness of insurance among Thai people as well as improving local infrastructure," Manuel said.

He said interest rates in Thailand were going down, so banks' margins and profits were being squeezed. During economic uncertainty, people put more money in savings accounts and use less credit.

"The banks have an urgent need now to increase fee income, including from selling products like insurance, mutual funds and structured products to customers," said Manuel.
"We [Teledirect] want to come and work directly with business partners to transfer the knowledge and expertise we got in other markets to help them tap opportunities to accelerate their sales," he said.

While banks in Malaysia, which do not sell insurance actively, earn fees of between $2 and $3 per customer, some advanced banks can make up to $20 per customer in fees from insurance sales, Manuel said.