Look Out For Telemarketing Speed Bumps

People are getting tired of intrusions.Cell phones and beepers remind us of how accessible we really are.At work there is a barrage of e-mails to wade through. When we gethome, a telemarketer interrupts dinner.

But in this communications revolution, independent agents areforever looking for new and creative ways to get a customersattention and telemarketing is one answer.

It is true that some people do not want to be called atdinnertime–ever. However, others do want to be sought out whenthere is a product or service they need. And telemarketing canreach them.

Studies indicate that the technique can be very successful.According to the Washington-based American TeleservicesAssociation, the telemarketing industry employs more than eightmillion people in the United States alone and generates an averagereturn of $7.15 for every dollar invested.

A recent study by The Winterberry Group, a direct marketingindustry research and consulting firm with offices in New York andSanta Monica, Calif., found that outbound business-to-businesstelemarketing (call centers that contact prospects) generated morethan $330 billion in 2000. Outbound business-to-consumertelemarketing accounted for more than $240 billion in revenue.

The real challenge for the direct marketing industry–andindependent agents looking to use direct marketing in theirbusiness–is using technology to call those prospective customerswho most likely would be interested in their product or service andwould be likely to respond to direct marketing.

Using new data-modeling techniques, it is now possible toproduce a list of prospective customers and predict the top 20percent of respondents to your product or service and your brand ofdirect marketing. Combining this with customer relationshipmanagement technology allows telemarketers to be less intrusive intheir quest to forge new relationships with potentialcustomers.

The point is this: there is a lot of bad marketing going on outthere.

Just hoping for some kind of hit ratio, many ill-informedtelemarketers are blanketing lists of unsuspecting consumers andbusinesses with products and services they cannot or will not buy.This is especially true with the advent of e-mail.

Independent agents can do their part by carefully creating amarketing list, which should consist of:

The demographics of their current clients and geographicboundaries.

The business size they want to target.

The Standard Industrial Classification (SIC) codes of theirtarget markets, and whether they need to use the six-digit SICcodes.

When calling, sending e-mail or mailing solicitations toconsumers, agents should consider:

The income levels being targeted.

The need for credit-scored information.

Home values, if they apply.

The age group of prospects

Agents should provide their client list to a database-modelingfirm to create a model of businesses or consumers most likely tobuy their product or service. Running the list through the modelidentifies the clients that should be called or mailed first.

It can take three to four years to write most big accounts.Using telemarketing, the cost would be between $14 and $20 for eachprofiled lead and it usually takes about five of them to convertone into an appointment. The information is good for years and canyield appointments every year if properly managed.

Agents should use an electronic-CRM software system to trackresults and manage data. The system enables an agent to store andmanage customer service and prospective customer data for use bycustomer service representatives and salespeople.

The software not only allows the agent to manage the dataproperly, it can prevent a disgruntled associate from walking awaywith the principal's leads, and gives the producer the maximumreturn on a direct marketing investment.

Finally, agents should be aware of their states regulationsconcerning telemarketing, especially if they decide to do it inhouse. Thirteen states have enacted Do-Not-Call lists–consumers whodo not want to be contacted by telemarketers. Of these, two do notmaintain a Do-Not-Call list, but require callers to subscribe tothe Direct Marketing Association lists.

In New York, for example, you are pretty much assured a pardonfrom prosecution if you can prove you have registered by purchasingits Do-Not-Call list. The broad exclusions in the law were setforth to protect the firms that genuinely are interested inproviding a valid service to the businesses and consumers the lawis designed to protect.

Most marketers do not want to call or mail solicitations unlessthey have a pretty good chance of getting a return on theirmarketing investment. Careful list selection, e-CRM,well-thought-out scripting, and well-trained telemarketers can go along way to achieving that end.

Larry Neilson is founder and president of Laguna Hills,Calif.-based National Marketing Services and CEO ofProgramBusiness.com. He can be e-mailed at [email protected].

Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, September 17,2001. Copyright 2001 by The National Underwriter Company in theserial publication. All rights reserved.Copyright in this articleas an independent work may be held by the author.

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