Telemarketing Related Information

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The following is an article relating to the telemarketing industry including products and services in our business areas.

BY BARBARA LOVE

After years of being the source of last resort for many publications, telemarketing is getting stronger-than-ever buzz among consumer marketers and B-to-B circulators alike.

In some ways, telemarketing has never faced more challenges. But growing using of call-screening, multiplying state do-not-call lists and heightened scrutiny by Congress and the FTC don't seem to be having a huge impact on legitimate telemarketers (who say that self-screening reduces wasted calls, and that they welcome crack-downs on fraudulent telemarketing operations).

For marketers, the growing advantages of this source are clear. As the response rates and cost-effectiveness of direct mail and other traditional sources go south — while technology and competition continue to help reduce telemarketing costs — going to the phones has become more and more attractive. “In many cases, our per-order telemarketing costs for requalifications are running at about $2.50 to $3.50,” notes Jerry Okabe, VP, circulation for PBI Media, LLC. “Not many years ago, the cost was easily double that.”

Still, yielding maximum results from telemarketing does take mastery of the basics and a willingness to test new ways of using this source and working with vendors. CM recently asked circulators and vendors to share their best telemarketing tips. Here's a round-up of their advice.

Analyze your sources carefully. Earlier or added telemarketing efforts may be in order. Many business-to-business circulators are going to the phones earlier for acquisition, as well as requalification. And some consumer marketers are also using telemarketing more aggressively, particularly for renewals.

For instance, Cary Zel, president of the ProCirc circulation outsourcing agency, says that, given the continually rising costs of acquiring new subs, some clients now find it cost-effective to use two phone renewal efforts. He recommends a first call that focuses on converting the subscriber to continuous service, and a second one, at the end of the series, that stresses the “last chance” aspect.

“More paid titles are introducing earlier renewal phone efforts and continuing phone efforts until the cost reaches the cost of obtaining a new subscriber,” confirms Lissa Love, VP, publisher services for DialAmerica, Inc. “The approach depends on the source. With telemarketing-generated subscribers, it makes sense to call early in the series — usually, the second effort. We'll also call these names later in the series. A month before expire is common. Then, for many publishers, we call a third time, at post-expire.”

Contrary to some circulators' assumption, agent sources can also prove good candidates for renewal calls, according to Love. “You want to pull these names for a phone effort as early as possible in the series,” she says. “The telemarketer can do some modeling to find the most responsive names to call.”

In companies where renewals and new business are handled by different people, more communication might improve the bottom line. With additional phone efforts, a renewals manager may be able to replace negative-remit subs with subs that have a much more attractive cost-per-order, and will continue to renew, points out Love.

Develop business relationships with more than one telemarketer. In addition to the obvious advantages of volume and competitive bidding, the greater pressures of meeting circ goals have made it more critical than ever to have ready alternatives. “I rely mainly on two telemarketers, because I want the clout of volume and consistency for pricing and availability reasons,” says the chief circulator for one multiple-title B-to-B publisher. “But I always make sure that I have a telemarketer to fall back on in case an unexpected change becomes necessary.”

Also make sure that you pick telemarketers who know the auditing ropes, particularly in the more complicated arena of B-to-B. (Even then, it's still a good idea to get every campaign pre-approved by the audit bureau before rolling it out.)

Where possible, solicit or renew for two or more titles, and upsell other products. Where titles have similar demographics or serve the same industries, it just makes sense to use the same call to try to sell or qualify both. And it certainly makes sense to try to renew or requalify two titles at once. A renewal call for one magazine is a perfect reason to ask a subscriber if he or she would like to take care of another magazine's renewal at the same time, even if that second subscription isn't due to expire for eight or nine months. (Note: With multi-title phone sales, BPA requires tape-recording.)

At Highlights for Children, which is completely circulation- and product-driven (the title doesn't take advertising), telemarketing accounts for about 50 percent of renewals, according to senior VP, marketing Marilyn Fiske. And, Fiske reports, Highlights has found that using telemarketing at the beginning of its renewal series enhances its ability to effectively sell related products, such as books.

Keep scripts as focused and as short as possible. Brevity is increasingly important in successful telemarketing. Highlights — which, as noted, sells products when it makes renewal calls — nevertheless tries to keep the call as short as possible. “We used to take a more conversational approach,” says Fiske. “But with so many working moms now, and so many who are barely able to keep up with everything when they are at home, we've evolved to a more to-the-point script.”

“You have a very short window during which people are deciding whether to listen or hang up, so you have to concentrate on a single hook,” stresses Zel. “If the core message is, ‘Renew now so you'll never miss an issue,’ you have to state that quickly. You don't have time to go into all of the editorial benefits. If you don't get the main selling point across quickly, you may never get it across at all.”

There are exceptions. Some publishers make a conscious decision to prolong a call not just for upselling, but for gathering additional demographics for advertising purposes or researching renewal refusals. As long as clients understand the response trade-offs of requesting additional information, telemarketers are happy to comply.

Educate the vendor about your magazine and share lessons learned from recent campaigns. Telemarketers say that a publisher should always supply copies of the magazine, a description of its audience and editorial mission, and samples of recent direct mail. Nick Cavnar, VP, circulation and databases for Hanley-Wood LLC, also stresses the importance of conveying any unusual aspects of the magazine, a market or a campaign.

“For instance, telemarketers need to understand that many of our subscribers are small construction remodelers,” he says. “These people tend not to be home during the day, so they may need to be called in the evening. Another example: If a campaign involves trying to reach many subscribers within a number of large companies, the circulator should alert the telemarketer that it might be better to space out the calls, so that receptionists don't get overwhelmed and upset.”

Don't economize on lists. “It all starts with your list,” says Christine Oldenbrook, VP, audience development for Primedia Business Magazines & Media. “Make sure that it's the best you can buy — the cleanest and most updated. Phone numbers change quickly.”

“The list is vital,” agrees Gail Stone, president of telemarketing firm PTM Communications International. “The more circulators target and define the list, the better the results. If they spend more money on the front end to get a list that allows us to convert a higher percentage of names, the campaign is ultimately more cost-effective.” Stone adds that phone lists should always be tested before they're rolled out.

Give the telemarketer time to polish the presentation. Pulling business from a telemarketer after only a half-day or a day usually isn't fair or smart, according to circulation professionals. “You need to wait a day or two, because it takes time for the customer sales reps to work the glitches out of a script and figure out what works best,” says Cahners Business Information circulation director Anne Osmer. Circulators can help with this process. For example, one renewal campaign for Official Hotel Guide got off to a rocky start, “so we regrouped,” says Osmer. “We went over the feedback we'd gotten thus far and came up with some ideas for more effective approaches.” Ultimately, the campaign was extremely successful, she reports.

Stress the customer relationship as much as the sale. Highlights does telemarketing in-house in order to maximize control over scripts and the customer experience. “But whether you're in-house or outside, you need to closely monitor telephone sales today,” stresses Fiske. “Sensitivity matters a great deal. At the first sign that the person doesn't want to be telemarketed to, we get out. We have our own do-not-call list, in addition to using the DMA and states' do-not-call lists.” Moreover, customers who've indicated during a renewal call that don't want to be called again receive a letter confirming that they've been taken off of the telemarketing list. “This creates a lot of goodwill,” says Fiske.

“The customer service aspect is as important as getting the renewal,” agrees Zel. “A vendor that gets a few more orders, but upsets some subscribers by being too pushy, is not worth it. I'll stick with the vendor that treats the customer with sensitivity.”

Smart circulators randomly monitor calls during every campaign. Obviously, it's critical to confirm that CSRs are asking the key sales or qualification questions and conforming to audit regulations, but nuances are also important. “You should listen to everything from the way that a telemarketer pronounces words to the tone of voice used,” says Gloria Adams, circulation director for PennWell's Advanced Technology Group. “This tells you a lot about whether you want to continue with that vendor.”

Monitoring can also yield valuable insights about your subscribers and your magazine. “When clients listen to calls, there are always some revelations,” notes Stone. “They say, ‘I'm so surprised that someone would say or think that about the magazine.’”

Use the phones to maximize gift programs. “Some publishers think that they're doing enough with multiple mailing efforts during the October-to-December period, but they're often pleasantly surprised when they test telemarketing, as well,” says DialAmerica's Love. “Telemarketing is very effective for getting people to add on another gift and renew their own subscriptions.”

Love strongly recommends that publishers do most gift telemarketing during October and November, in conjunction with direct mail, rather than waiting until mid to late December to hit the phones. Following up the usual January and February mailings to non-responding donors with a phone campaign in March is also very effective, she says.

Use the phone to help resurrect “dead” expires. Publishers have always mailed to these expires, but adding a phone effort can significantly increase response, according to Love. “For a number of publishers, this has been successful even with names that are two or three years old,” she says. “The idea is to do the mailing, then do a phone effort three or four weeks later to those who haven't responded.”

Cost-per-order models may provide greater control than per-hour payment models. Some circulators say that paying vendors on a per-hour basis doesn't allow for as much control on their end as a cost-per-order model, in which the vendor is paid a commission or a remit only on actual completed orders.

Barry Green, VP, circulation for Hearst Business Media, points out that you can test per-hour sales with a telemarketer, and then convert the number sold per hour to the cost-per-order, to determine if there's a significant difference. “Vendors who normally work on a cost-per-hour basis may be willing to test a list and see how well they can do on a cost-per-order basis,” he says.

Green adds, however, that he personally prefers a cost-per-order structure, for two reasons. “One is that, if I have $37,000 for a telemarketing campaign, and I'm paying $3.70 per order, I know that I'm going to get 10,000 subscribers for that money. It's easy to keep track of what I'm spending. If I pay by the hour, I can't be as sure of what I'll end up with, unless I spend much more time and effort monitoring the results reports every day.”

The other reason is fluctuation in response. “Even if I test paying by the hour before agreeing to that payment structure, there can be unpredictable fluctuations in the number of orders generated per hour over the course of a campaign,” explains Green. Other circulators also note that, with a cost-per-hour structure, a campaign that's not pulling expected response levels can end up exhausting the allotted budget before goals have been reached.

But not all circulators dislike per-hour arrangements. “At the end of the day, it comes out about the same,” says Cavnar. And many telemarketers say that they'll go with either per-cost or per-order, because in either scenario, they structure the deal to ensure that their standard profit margin will be achieved.

Track net cost-per-order. This applies whether you're paying on a per-order or per-hour basis. In assessing the success of a campaign, some circulators evaluate cost-per-call, but neglect to look at true net cost-per-order.

“A lot of telemarketers will make two or three attempts to get through, so the cost-per-call and the cost-per-order can be quite different,” explains PBI's Okabe. “A telemarketer may charge $4 per call, but when you add in the set-up fees and incomplete calls, the overall cost is much higher.”