Face Time Still Beats Out Web Teleconferencing

Despite technology, meeting in person rules day

By Becky Hurley, Colorado Springs Business Journal

3/10/06

Nearly two-thirds of business travelers are taking fewer trips and almost eight in 10 say they are interested in alternatives to traveling, but meeting via technology isn't quite ready to replace face-to-face encounters.

The practical problems associated with video conferencing have limited its use said Kim Moore, founder and CEO of Executive Systems of Colorado Springs.

"We offer videoconferencing services, but have only been asked to set up two events in five years," she said, noting that the technology "has never been quite stable."

"There's the challenge of end-to-end technology," she said. "Unless both companies have compatible equipment, it's hard and expensive to implement."

Moore said that teleconferencing continues to be popular—with Web-based technology increasingly used to complement other forms of communication.

According to a survey conducted by Wainhouse Research entitled "Usage Trends of Collaboration Technology by Business Travelers 2004," 63 percent of business travelers are taking fewer trips and 79 percent are interested in alternatives to business travel.

Web and video conferencing proponents say the shift is a result of terrorism-related uncertainties, the inconvenience of heightened security and the high cost of frequent business travel.

Fortune 500 companies IVCi and WebEx specialize in video conferencing, audio/visual, streaming, Web conferencing and managed conference services.

"Today's business professionals must be accessible by the organization at all times," said Harold German, director of marketing for IVCi. "The only way to meet and collaborate, regardless of your current location, is by using video or Web conferencing. Video conferencing is best for face-to-face meetings, Web conferencing is best for collaborating on documents and work projects."

Selling Power magazine published a white paper in 2005 by Geoffrey James entitled, "The Business Case for Web Conferencing in Sales Environments." The article describes three areas in which technology provides added value.

He asserts that the ease and low cost of adding attendees means Web conferencing can broaden the sales funnel, the number and quality of sales leads, and improve sales productivity which, in turn, decreases the cost of sales.

For a two-hour meeting with five attendees, James estimated a cost of $3,700 for four of the people to travel for a face-to-face visit. That compares to $750 for the same five individuals meeting by teleconference.

Other sales benefits of the telephone and Internet meetings include the ability to archive sessions for later viewing. Technology also allows meeting attendees to conduct instant polls, independent of peer pressures or eye-rolling, often typical of a conference room setting.

The Web also allows sales people to access online material such as mortgage calculators, comparative sales data or exhibits. And once a deal is done, online communication can support good customer service.

But not everyone finds technology effective in doing deals.

Brenda Goodrich, vice president and general manager of Citadel Broadcasting Co., manages her company's national radio accounts.

"For several years after 9/11, corporate management asked us to look for alternative ways to reach our customers," she said.

During the last 18 months, however, Goodrich has gotten back on the road, visiting major clients as often as once a quarter. She sees the cost and time involved as paying a high return on investment.

"I may spend $5,000 to $6,000 a year on business travel, but one new account can pay for a year's worth of travel," she said. "When it comes to building relationships, nothing works like a face-to-face meeting."

Her words are echoed by Maurice Gaubautz, founder and president of Pxyant Labs, a testing laboratory that provides data to large pharmaceutical companies.

"I'm meeting for the fifth time with a prospective client who is flying in from Los Angeles," Gaubautz said. "I flew out four times to meet with the same company before they decided to visit our facility. Business travel is still key to selling our service."

The entrepreneur said he is interested, however, in finding ways to expand customer relationships through technology.

"So far our clients haven't asked us to use Web conferencing, though I think it could work well," he said. "They tend to use the Internet internally—not so much with vendors."

Even international businesses like Sturman Industries, which supplies fuel injection, valve and cam-less engine technology to car manufacturers, find that face-to-face meetings with Japanese or European clients pay the highest dividends.

President and Chairman Carol Sturman said her firm's sales team spends 40 to 50 percent of its time on the road.

"It's part of our culture to get to know our clients in their environment," she said.

While the company's travel agent keeps expenses down by purchasing tickets in advance and employees occasionally book their travel online, Web conferencing won't likely substitute for in-person sales calls anytime soon.

Spok eswoman Ellen Pitrone said that connectivity through international cell phones, laptops and the Internet remains a sales essential, however.

Even travel agents see Web or phone conferencing as a distant second in the sales travel arena.

"We haven't seen any big drop in business travel in the past few years," said Russ Knight, office manager for Globe Travel. "You just can't get it done as easily without human contact."

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