By Malia Zimmerman, 8/19/2009 12:02:49 PM

Matt Longfellow and Francisco Javier Arango, owners of the local direct mail company, Island Direct Marketing (dba ValPak Hawaii), signed up for a new Hawaiian Telcom Yellow Pages business marketing system called “pay-per-call,” which is actually owned by the Berry Company. Under the plan, after purchasing an advertisement in the Hawaiian Telcom Yellow Pages, their company was assigned a special tracking phone number, so when they received inquiries from potential clients on this phone number, they were charged $17 a call.

Pitched to them by a local sales representative with the idea that they’d only pay for business leads they received on the designated number, Longfellow and Arango were looking forward to gaining new clients at an affordable price. But what they got instead was a series of ghost calls, wrong numbers, and other technical problems, which all added up to a nearly $1,000 bill with no payoff.

“We were told about the ‘pay-per-call’ program and felt, as most other businesses signing up, we had nothing to lose. But then we started receiving phony calls to our number, which dramatically inflated our bill,” Longfellow says.

Not one of the phony numbers listed was a legitimate call to ValPak, Longfellow said, with many callers out-of-state individuals who had no reason to call. They also had calls from other business owners not trying to reach ValPak, but rather asking for insurance companies, real estate companies, shipping companies, and other businesses unrelated to theirs.

“You name it, we’ve gotten it. The individuals are confused saying they are calling listed numbers and being redirected to us,” Longfellow says.

In a call to Hawaii Reporter, The Berry Company defends the program saying they are unaware of such technical problems. But they have not returned calls to ValPak to clear up the problem.

When they tried to get answers from the local sales manager, Longfellow and Arango say they were instead ignored and then cut off from accessing their account information on the Internet. As a result, they filed a complaint with the state Department of Commerce and Consumer Affairs. Their bill continues to climb.

“It has been several weeks, and we are still unable to get a returned call from the Berry Company to address the problems we were having. In addition, when we started calling back the phony numbers (which we obtained through the Berry Company online billing system or on our caller ids), the company shut down our access to our account information,” Longfellow says.

Several small business owners interviewed about their experience with pay-per-call brought out similar concerns, including phony calls, wrong numbers and calls for service out of their area.

But the Berry Company said the company has received positive feedback on the new program launched in April 2009. Jenny Michael, national Director of Marketing Communication for Berry, says while a third party vendor in Hawaii provides the service, she is not aware of any complaints that are unresolved.

The program is popular with businesses, Michael emphasized, because through a “unique metered program” they only pay for leads they get. Clients also have the opportunity to design their own contract and set their own rules and pricing plan. Their charge per call varies by type of industry.

“The beauty is the transparency,” Michael says, stressing that client satisfaction is important, and the Berry Company is more than happy to work with clients who are unsatisfied. When asked about Valpak, Michael said she cannot comment on a specific customer, but noted that Valpak is a competitor to the Berry Company nationally, and implied that maybe this was an attempt to undermine their competition.

But Valpak’s owners are not the only ones speaking out locally. Two companies based in Kona said they received several calls from people in Hilo and from other parts of the Big Island, which is an area they do not service, even though they were told they’d only get calls from Kona.

Craig Rice, a general contractor in Kamuela on the Big Island, says he has received some “real business calls and some not.” He says his major problem is that he has received about 4 to 6 calls a week from the Hilo area, including calls from out-of-work carpenters, even though he told his sales person that he only works in Kona and wanted to be listed just in the Kona directory. He also says like ValPak, he’s received “bogus” calls. But he hasn’t received a physical bill yet since signing up three months ago, which has him worried about the total cost, especially since he “has not received any work from it whatsoever.”

Another Big Island business owner who runs a carpet cleaning service has similar complaints. He just operates in Kona, and yet has received calls from around the island including Puna and Keaau. He’s even gotten calls from people who want to know how to clean their own carpet. He’s also received ghost calls. And for each of those calls, he’s been billed. He received a $600 bill, and had little return, so wants to reassess his contract. “I have no problem paying for legitimate leads I receive, but these callers are not looking for service,” he said.

Frank Visconti, owner of FIXROT.com and Replacement Windows Hawaii on Maui, signed up in May of this year in the Maui home improvement section. He has never had a phone book ad, but spent over $8,000 in advertising last year in local newspapers. Visconti says he told his Yellow Pages sales representative that he did not want to receive any calls to fix broken glass, and the sales representative “clearly stated many times” that that would not happen. But that didn’t end up true, he says. In fact, 80 percent of his inquiries have been to fix broken glass. Besides ghost calls, some calls come from Oahu when he is located only on Maui.

“I have never received any calls for my primary business, home repair, because if I had, I would be very happy. I make good money when clients call and have a rotted fascia board or just need a few hours of something. I would not be complaining and demanding they suspend my ad (which as of today they are not doing).”

Visconti says he called his sales representative three times and never received a call back. When he finally reached him in person, the sales person promised to talk to his manager and get back to Visconti, but never did. Visconti also says his billing is confusing and doesn’t match the online call tracking reports. He’s asked in writing to cancel his service because he feels like he is getting ripped off, but hasn’t received a response.

Ephrain Kaleiohi, owner of Discovery Island Tours, has operated his own travel company on Kauai for 10 years. Since he signed up for pay-per-call, he regularly receives inquiries from customers on Molokai and Maui, when he says there is no way he could service them with his Kauai island tour business.

“I have people calling me from Maui and Molokai to go on a kayak tour. They are calling the wrong island, but I am still charged $12.50 a call. There is no way to screen every call and I don’t have the money to pay this off – I am a small company,” Kaleiohi says.

The Berry Company told some of these company owners to hang up within 15 seconds, so as not to be charged for the call. But several point out that response could potentially hurt their business.

“If I hang up on someone, I will be perceived as rude, and that is not the Hawaiian way,” Kaleiohi says. In addition, if they withdraw from the program, and have their yellow pages number disconnected, that could make it seem as if they are out of business, and also hurt their business, Kaleiohi says.

In a weird twist, these unsatisfied Hawaii customers were easily tracked down because Valpak’s special tracking number appeared on their phone caller identification, and they called Valpak to see who’d called them. That meant Valpak was billed for those business calls, even though the businesses thought they were just returning a call to a customer who’d left their number, but no message, on their caller id. But that led to an unexpected network of Berry Company clients all talking about their experience with the program.

For example, Kaleiohi says he received a phony call from Valpak’s special inbound number at midnight and 12:30 a.m. on different days.

Saul Nelson was connected to ValPak when the company’s number showed up on is answering machine caller id one night, and he returned the call so he wouldn’t miss a business lead. The company owners began to commiserate on the problems with the new service.

A Maui plumbing contractor, Nelson, who recently signed up, says he has received several dropped calls on his number or calls with no one on the other end, which he calls “fishy.”

Longfellow, who is vice president of the business advocacy group, Smart Business Hawaii, says he really wants to get to the bottom of this problem, because it is hurting small businesses locally at a time when they can least afford it. “Most of the businesses we’ve spoken to knew there was a problem but either thought it was just them having the issue, didn’t have the time to pursue, or didn’t know where to begin. Most thanked us for following through because otherwise, their issues may have gone unreported.”

The Berry Company has not been able to explain ValPak’s unique inbound tracking number showing up on other business owners’ caller id.

However, Hawaii Reporter contacted these other businesses and confirmed this had indeed happened. They said they received incoming calls from Valpak’s Hawaiian Tel-assigned incoming-only number, sometimes as late as midnight. There is no technical way for Valpak to call out with their assigned inbound number, so how it has been happening is still a mystery, Longfellow says. But what is no mystery, is the unexpectedly large bill for clients’ calls they never received or benefitted from.

The Berry Company also declined to speak specifically about their clients being on the receiving end of phony calls, wrong numbers, wrong service or service-out-of-the-area calls, the inflated billing or the lack of customer response locally, only saying the company can work with the clients to customize their contracts and adjust their bills.

Hawaiian Telcom responded to this media inquiry by clarifying that they sold their name to the Berry Company and under that agreement, still send out billing for the Yellow Pages, but otherwise have nothing to do with the program.

Longfellow says it seems like a scam to inflate billing: “I am a small business owner and we represent many small business owners. What I see is a scam perpetrated against business owners in Hawaii, and I feel it’s my duty to speak up. This isn’t about competition, it’s about integrity. The Berry Company is giving everyone in the advertising and marketing industry a bad name with these types of practices and scamming local businesses out of hard-earned money.”

He adds: “An organization like The Berry Company should want to work with us to uncover the problem if that was going on, but they haven’t. If they have responded, it has been with denial, cover-up, and closing off of access to the information. I have yet to get an answer for the caller id and how widespread this is. We’re getting calls from all across the country and there’s no reason to suspect this is isolated just in Hawaii. No wonder they are trying to hide this.”

The Berry Company continues to deny wrongdoing, emphasizing their “revolutionary” program, their customer satisfaction level and the ability and flexibility of their clients to design their own contract. Michael also said they will work with clients to resolve any complaints, should they receive any.

Original story: http://archives.hawaiireporter.com/story.aspx?b329e43f-740f-400b-b3b2-718176d48aa4

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