March 11, 2003, 12:00 AM

How doubled revenues in one year

Niche player Headsets booked $7 million in 2002, twice as much as the prior year, by giving customer service top priority. Management considers any employee not dealing with customers to be overhead.

E-commerce success can come from defining a niche, and however small, serving it better than anyone else. That’s been the formula for success at, a 5-year-old Internet and catalog company whose revenues more than doubled to $7 million in 2002 from about $3 million in 2001. The revenues also include two other sites added in the past year–, which sells high-quality audio conference equipment, and the headphone-selling 90% of sales come from headsets, CEO and founder Mike Faith tells

While Headsets also has a catalog, printing 3 million copies of it in the fourth quarter of last year alone, some 33% to 40% of sales take place online. “If you add in Internet sales that take place in combination with a phone call, it’s probably about two-thirds,” Faith says.

That makes the web-enabled customer service staff of primary importance to sales, so much so that Faith approves each hire personally. “We have a 10-person customer service staff, and they are two-thirds of the company,” he says. “I consider the other five–-including myself-–overhead, because it’s really the customer service people who are making the money for the company.”

Customer service reps at Headsets must undergo a four-interview process, unusual for such jobs, and pass a series of tests including emotional profiling and IQ tests before they are hired. Only about one in 30 interviewed makes the cut. New hires get a two-week training course and must score at least 95% on a test at the end of training before they start phone duty.

Reps are on duty from 7:00 a.m. to 4 p.m. every day, and customers who require phone support from Headsets outside of those hours leave messages for personal callbacks later.

“We answer every phone call with a live person, and I actually listen in on calls an hour a day to make sure the quality is at the level I expect,” says Faith. “We’ve looked at outsourcing but we’ve stayed with a course that lets us have control. It’s more expensive, but it’s been worth it.”


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