Gavin Scholes: How one man’s vision built an industry
For Gavin Scholes, money is just a by-product of hard work. What really gets him excited is being able to help businesses benefit from his words – his Telstra Phonewords. The CEO of Telstra Phonewords speaks with Business First about life, business and lo
For Gavin Scholes, money is just a by-product of hard work. What really gets him excited is being able to help businesses benefit from his words.
There is a pleasure when you are driving with your kids from 2005 and they say, ‘There’s one of Dad’s Phonewords’,” says Gavin Scholes as he explains the joy he gets from the work he does.
“No one will ever understand how much enjoyment I get when I see a company using a Phoneword. You’re helping their business. For me, it’s never been about the money. It’s never been anything like that. I get a lot of enjoyment out of seeing businesses benefit from using a Phoneword properly.”
Way before there was Phonewords, Scholes was a pastry chef and had the same attitude to making people happy – as you’d expect from a pastry chef who cooks from the heart, for the heart.
After completing his apprenticeship in Altona, Victoria he decided to travel around Australia. After 18 months away, on his return to make ends meet Scholes took a job as a Storeman in a small office supplies company in West Melbourne and that is when his interest in sales and marketing piqued.
It had 12 employees at the time and grew to around 100. In his ten years there, Scholes had worked his way up to Sales and Marketing Manager, but eventually it was bought out by Corporate Express who came into Australia to consolidate the industry. As part of the Corporate Express industry rationalisation, Scholes moved to Sydney to take up the role of Marketing Director.
However, he was unhappy with the business ethics of the company, especially having been part of a small family business before the takeover. He left after two years, but learnt a valuable lesson:
“It doesn’t matter how well the business is going, if you don’t look after your staff, if you don’t look after your suppliers and especially your customers, you don’t end up with a great business, and most importantly it’s not enjoyable.”
Positive relationship management is a business ethic that
Scholes was determined to implement into his own business.
That business was Telstra Phonewords and it came about after he responded to a ‘for sale’ advertisement in 1996 posted in
The Age newspaper. “There was a guy that had a couple of phone numbers to sell. I met him at a pub in South Melbourne. I was looking for something to do at the time and he had three numbers: 1300 Realestate and 1300 Petcare.
Scholes can’t remember what the third number was, but it didn’t matter. He had an idea this would set the course for his business life to date.
“I went about implementing a shared Postcode model experience for real estate agents around the 1300 Realestate number. Agents could have the number pointed to them exclusively in their postcode, only one agent per Postcode.”
It took Scholes three years to roll that business out, but he was able to sign up 800 estate agents, which enabled him to hire his first staff members.
In the background, Scholes was trying to get Phonewords up and running.
Just to clarify, Phonewords are the words used in a phone number. For instance 13 Cabs, 1300 Rental, 1800 Holiday. As the Telstra.com website states: a Phoneword works as a consistent brand identity throughout multiple branding channels (advertisements) leading to increased brand awareness, customer engagement, sales opportunities and ultimately increased revenue.
The problem back in Phonewords’ formative years was the Australian keypad had no standardisation.
“Australia never actually standardised the international key pad. To give you an example, A B C is now on the letter 2 on your phone. Back then, it could have been on zero, it could have been on 1. Ultimately you couldn’t use Phonewords, because really only about 40% of the phones were compatible.”
Scholes began to lobby the government for change. He had success, however he says it was a four-year process for people to turn their phones over.
The next step in the process was lobbying the government to make all of the numbers available. The government was still in charge of number allocation.
In the United States Phonewords have been used for 35 years with amazing success, it was time for Australia to catch up.
This was in 2002 and after discussions with the ACMA (Australian Communications and Media Authority), the laws were changed which allowed Scholes in 2004 access to buy numbers from the Government.
At the same time from 2002 Scholes had been trying to convince Telstra to become a Joint Venture Partner and lend the capital required to buy the numbers. Seven meetings over nearly two years saw him turned away on every occasion until eventually Telstra Employee Hayden Kelly introduced him to Senior Executive Ted Pretty. From there the tide turned.
“Ted got the idea and supporting business model in 15 minutes, and asked me how much money I needed. I said I needed $10 million dollars, and he said, ‘Done’. That started the joint venture between 1300Marketing and Telstra back in 2004.”
Today, Australia is the only country in the world where businesses own their phone numbers. Everywhere else in the world, phone numbers are leased just like mobile numbers.
Scholes says some Senior Telstra Executives initially underestimated the power of such a simple concept in terms of people being able to use Phonewords to market their business.