Wednesday, February 18, 2009
Posted by: David Regler @ 3:24 pm |
I must admit, most people's view of telemarketing is that it's only ever outbound.
However, strictly speaking, telemarketing comes in two flavours - outbound telemarketing and inbound telemarketing. Before we look at outbound telemarketing, let's quickly cover inbound since that's not what we're dealing with here.
As the name suggests, inbound telemarketing describes calls being received, usually in response to another marketing activity, such as a direct mail campaign or direct response advertisement.
You know, call an 0800 number to get a free catalogue, etc.
Unlike outbound telemarketing, inbound is almost always dealt with by large call centres. This is simply because of the volumes of calls associated with direct response campaigns.
An outbound telemarketing campaign, on the other hand, can be a much smaller direct marketing campaign.
When used alongside other direct marketing tactics, it can add value in a number ways to maximise return-on-investment (ROI) for the overall campaign.
One thing to always consider is whether you use outbound telemarketing as the main campaign tactic, or whether you add outbound telemarketing to support wider campaign objectives.
Here's a couple of examples of how outbound telemarketing can be used effectively within direct marketing campaigns:Outbound telemarketing as the main campaign approach
- a simple standalone outbound telemarketing campaign would involve sourcing a list and calling it. However, by adding additional marketing support to the campaign you can significantly increase it's ROI.
For example, a classic approach is to send a direct mail piece in advance of the outbound telemarketing call. The direct mail piece isn't the the main campaign objective, it's just there to provide a reason for the call, Done correctly, this approach paves the way for a warmer outbound telemarketing call.
Equally, you could plan to send further marketing collateral, by email for example, at the end of the call. As before, this approach is designed to support the outbound telemarketing call and provide a reason to call the prospect back to further qualify their interest.
This style of outbound telemarketing call is the most common approach for appointment setting. The initial letter (or email) is sent to provide a reason for the call and then the collateral sent afterwards supports the campaign objectives by providing another reason to call back.
Without these additional materials, relying only on a cold outbound telemarketing call, you'll convert far fewer leads.
However, used in this way, the overall ROI for the outbound telemarketing campaign can be significantly increased since the additional supporting material costs (for the letter and emails) are far lower that the costs for outbound telemarketing. Outbound telemarketing to support other marketing campaigns
- an alternative approach is to use outbound telemarketing to enhance other marketing efforts, such as email marketing or seminars.
For example, let's say you are running a business-to-business email marketing campaign sending an email to 5000 prospects. Email marketing works best with a call to action that involves a "click-thru" to a website. This could be to register for an event or download a white paper, for example.
Metrics on email marketing campaigns vary depending on how you acquired the email addresses (for example, were they opt-in from your website or did you buy a list) and the strength of the call to action. For our purposes, let's assume you had a 10% open-rate and, from that you had 10% click-thru to download your white-paper.
In this example, you send out 5000 emails, 10% open which is 500, and then a further 10% click through to download your white-paper. This means that you have 50 "leads".
Now, these leads will need following up to further qualify and this is where outbound telemarketing can be an excellent addition to the campaign.
Without adding outbound telemarketing, you might expect that, perhaps, 10% of the prospects who downloaded the white-paper might phone into the office - an inbound call!.
However, that would leave 45 leads that don't do anything.
If, by adding outbound telemarketing, you could convert another 5 out of 45 (not that high a conversion rate) then you've increased your ROI by 100%.
The key thing to note here is that it might only need 2 or 3 days of outbound telemarketing to speak with those 45 leads.
It's all about using different direct marketing tactics, including outbound telemarketing, in an appropriate way to deliver the best ROI for your overall campaign.
Labels: outbound telemarketing, telemarketing ROI
Wednesday, February 11, 2009
Posted by: David Regler @ 10:38 am |
We regularly get asked whether we work on a "pay-per-appointment" or "pay-for-performance" basis for our appointment setting services.
It's worth exploring the subject further to explain our views on this compensation model for appointment setting and why we believe there's a better way.
Pay-per-appointment sounds like the holy grail for most clients.
It appears (at first glance, anyway) as a zero risk option. With the popularity of Google's pay-per-click and other pay-per-lead online offerings it sounds like a no-brainer, right?
Well, like most things in life, it's not that straight forward.
Here are 4 things to consider if you're looking at pay-per-appointment or pay-for-performance appointment setting:
- it's pretty much universally acknowledge that commission-only sales compensation packages have been discredited. Think of all those mis-selling scandals within the pensions sector. It may still exist in the world of double-glazing and time-shares (do you want your business associated with these people?) but elsewhere business has realised that a balanced compensation plan which includes both a basic and performance element is the best way.
Why? The main reason is that performance-only plans motivate people to only be interested in making a short-term sale and encourages manipulative, aggressive and hard-selling tactics (watch the films "Tin Men" and "Glengarry Glen Ross" for more on this).
In the context of pay-per-appointment setting this translates to a boiler-room approach to closing the meeting at any cost.
After all, no meeting means no money so why should they care if they upset a few people? Think about all those arrogant sales people who've cold-called you in the past, pushing for you to agree to something that you weren't interested in and simply ignoring what you were saying just to close the deal. Do you want those people calling your potential clients and representing your company?
- OK, so you've got your appointment, the next thing you need to think about is whether it's any good. I've written previously about this (see my post Just what is a qualified appointment?
) but it's worth stating again.
A "qualified" appointment means that the person booking the meeting has to apply their skill and judgement to evaluate the quality of the appointment before agreeing to book it. This involves asking qualifying questions and deciding whether the meeting is worthwhile.
If you want a qualified appointment then your appointment setter needs to actually decide to not book
When I talk with prospective clients they all want good quality, qualified appointments with senior decision makers. No-one wants to waste their time, do they? So our clients are trusting us to follow a process which includes qualifying out
some opportunities before agreeing to book an appointment. If we follow that process correctly, it inevitably means that we may work hard, pitch a number of decision makers and not book any appointments - because they didn't qualify
Does that make sense?
People pay us to set up qualified appointments. Our performance can be evaluated in a number of ways, one of which is the number of appointments we book, another is the number of decision makers we pitch and qualify, and a third is linked to activity (such as time worked).
We've not got a problem being rewarded on a results-focused basis (all our fees have a performance-based element) but it needs to fairly reflect what we actually do.
- another thing about pay-per-appointment or pay-for-performance appointment setting is that it only focuses on short-term results at the exclusion of developing a longer term pipeline of contacts.
As I've blogged about many times before (see Is telemarketing a short or long-term investment?
) much of the value in a telemarketing campaign comes from developing relationships over a number of touches. In addition, utilising integrated marketing tactics, such as email marketing, seminars, direct mail, etc all add to the overall ROI.
When you pay-per-appointment you really are only seeing the tip of the iceberg and have no visibility of what's below the water line. Pay-for-performance appointment setting companies will not give you any details about who else they've called, the conversations they've had or even what stage other prospects are. You'll get no feedback on future requirements, competitors, review dates, etc.
Any why should you? You're only interested in the appointment, right?
What this means is that while you're only working with the 1% who have agreed to see you, your competitors are building relationships with the 99% who want more info, have future requirements, and generally are not ready right now.
Do you think an appointment setting company is interested in sending your latest piece of thought-leadership collateral? Are they motivated to nurture those relationships so that you're positioned to be invited on the next RFP?
Of course not! You're not paying them to do that, are you?
- finally, the most over-looked element of pay-per-appointment or pay-for-performance appointment setting is an appreciation of risk. Most companies consider the model to be zero-risk. But, the reality is that it only eliminates one risk - the risk of paying and getting no appointments.
As we've covered already, there are other risks associated with pay-per-appointment models that are rarely acknowledged.
There's the risk that the person calling is so motivated to book an appointment (if they don't book an appointment they don't get paid, right?) that they'll be aggressive, use manipulative techniques and generally strong-arm the prospect into booking. Or perhaps they may just come across as desperate, booking the appointment for "just 15 mins" in a way that positions your time as worthless.
Remember, as far as the prospect is concerned it's your company calling them
. Is that a risk you want to take?
Another risk we've looked at is the risk of wasting your time. How much does it really cost you to attend a sales appointment? Whether you're a sales person or business owner I guarantee that it's more than the cost of making the appointment.
If you get sent on a wild-goose-chase of an appointment that's been squeezed out by a paid-on-results telemarketer it will cost you. Unqualified appointments cost you in many ways, including the fact that while you're kicking your heels in reception, waiting for someone who's in their office wondering why they agreed to see you, you could be seeing someone who does want to buy.
And, finally, there's the "opportunity risk".
I'm talking here about the risk that you're leaving money on the table, letting your competition build relationships which you have no visibility of, and basically having no control of the marketing process.
This latter point about control needs some explanation.
Pay-per-appointment firms generally use their own data. This is typically a well-worn database of contacts that is shared across multiple campaigns for multiple clients.
Have you asked yourself why most of these pay-for-performance appointment setting firms focus on just one sector? It's so they can re-use the data and contacts they have. And if you're going to re-use the data then working exclusively with one company per sector just doesn't make sense.
Let's leave to one side the fact that they will often be calling on behalf of your competitors at the same time as they're working on your campaign; handling competing clients actually allows these firms to leverage their success (ever wondered why your competitor always seems to have signed into the same companies you meet with?)
Anyway, they also use the same data because they're not going to invest in new data just for you, after all, you're only paying for results. And if they're using the same data, after a while they get to know the "usual suspects" who will always see someone for an appointment. That's their low-hanging-fruit, right?
So they go after them first, get you a quick initial flurry of appointments, everything's looking great.
Then, a few months into the campaign, it starts to dry up a little. The number of meetings coming in slows down. The quality is dropping, further still. And all the while time is ticking, targets are getting closer and you're not getting the traction you need.
Why is this?
The reality is that once you get past the low-hanging-fruit and the lucky-you-called-me-today's, there's a lot of graft needed. Activity needs to continue, diligently calling back, sending info, building those relationships.
For the pay-per-appointment firm this is a diminishing return on their time.
Why should they be investing in building a pipeline they're not acknowledged for? Better to move into the next new client and start harvesting that low-hanging-fruit again.
We've worked with clients who come to us after they've been through this process and have spent months spinning their wheels. They can't get any meaningful data, they've had a handful of good, bad, and ugly appointments and now the pay-per-appointment setting firm isn't returning their calls.
Of course, if you've got no money to invest in marketing then pay-per-appointment might be all you can afford in the short-term. Who knows, you might just get lucky and close one deal quick enough to keep paying for more appointments. In my experience, it seldom works out that way.
Or perhaps you've got a hungry sales team of road warriors and you just want to keep them busy. Pay-for-performance appointment setting could be for you. After all, look at the number of meetings and activity targets they're all hitting.
But, surely there's a better model than that?
Over the years we've found it's better to have a fee model that strikes the right balance between fees that ensure focused activity and a performance element linked to revenue generated.
With us you pay some fixed fees (which are significantly below usual day rates of telemarketing companies), plus a % commission on revenue generated from appointments attended.
We believe this model ensures both that activity is focused and that we have a common objective of only delivering qualified sales appointments that don't waste your time.
Labels: appointment setting, appointment setting services, b2b telemarketing, pay-per-appointment
Tuesday, February 10, 2009
Posted by: David Regler @ 7:44 am |
Back in 2006 I posted a blog on Ecademy called "The Meetings Game": Some truths about B2B Appointment Setting
I was talking about many of the appointment setting agencies, mainly operating on a pay-per-appointment basis, who are simply "meeting machines". You know, the kind of boiler room operation that squeezes out a supposedly high-level 15 minute meeting just to hit their targets.
If you've ever been sent half-way across the country to find yourself sitting across the desk from someone who's equally confused why you're there - you know what I mean
My post struck a chord back then and is just as relevant today.
So, the question to ask is - just what is a "qualified" appointment?
Of course, it means something different for each client.
When we start an appointment setting campaign we invest time understanding exactly what "qualified" means to our clients. To answer that question we really need to understand their sales process.
What's that? Sales process? Surely our job is to book the appointments and let them worry about the rest, isn't it?
The reality is that unless your marketing and sales processes are clearly linked (and the initial sales appointment is pretty much the interface) then you are asking for trouble.
Think of it like this:
There are plenty of acronyms used for qualification; in the sales old-school everyone is taught MAN (Money Authority Need) - "you need to find the MAN".
We prefer to use AIM-T, which stands for Authority, Interest, Money, Timescale (think of Aiming at the Target). We use this because it actually follows the appointment qualification process.
That is, before we call someone we've usually pre-qualified (by targeted data sourcing) the authority level; when we engage with the prospect by phone we start the process of developing and qualifying their interest and, particularly in B2B sales, Money and Timescale can be partly qualified by phone but is usually best qualified as part of the sales process.
On this latter point, whilst it is possible to qualify some aspects surrounding Money, usually by asking questions that uncover whether the prospect is likely to be able to build a business case for your product or service (again this can often be filtered through data-sourcing) we believe that gauging budget and timescales is best kept within the sales process.
So, when is comes to qualified appointments, we need to understand (and sometimes educate our clients) about how they are going to qualify opportunities in the sales process to inform our level of qualification when setting appointments.
Let's look at an example: Say you're selling a high-end B2B product or service, such as a consulting offering or software proposition, with a typical long sales cycle. Whilst, it's true, we will occasionally call a hot prospect who's ready "right now", it's usually the case that they have some lower level of interest.
More often their level of interest will be very early stage and this is one of the great things about telemarketing. At that early stage they are aware of a need but they usually haven't acted on it (which means they haven't called in the competition yet).
The question is, at what point is their interest level high enough for us to set an appointment with them?
If our clients have a solid sales process in place then we may book an appointment with a prospect with the right level of authority and is willing to "take the meeting". Taking a prospect from this mild level of interest to closing a deal takes effort and skill but the rewards are that you're often not competing with other vendors (or at least you have the opportunity to influence a RFP and develop a relationship with the prospect).
Alternatively, if a client has less of a established sales process (or perhaps they are just extremely busy) then we take on the process of further qualifying and nurturing the lead until it's ready to book.
To do this we have to invest in clearly understanding our clients' business and proposition.
It can be a fine line and quite subjective, but that's why our people are so experienced at booking qualified appointments.
Labels: appointment setting, lead qualification
Friday, February 06, 2009
Posted by: David Regler @ 7:41 am |
I always advocate considering telemarketing as a long-term marketing tactic.
Of course, it's true that telemarketing can deliver immediate results; if you've targeted well and have a killer proposition then you can land a whale on the first day. We all get lucky!
However, the reality is that it takes some time to get a campaign up-and-running and delivering results consistently.
And here's a fact that very few people consider:
Once you've built a qualified database of prospects that have been called, sent info and further qualified (which could be 2 or 3 months into a campaign) your strike-rate improves by at least 100% when compared with the start of your campaign.
That's right, the longer you keep a telemarketing campaign running the more effective it is.
Now, whilst this may be an overlooked aspect of telemarketing campaigns it's hardly rocket-science. Here's why it works this way:
At the start of a campaign you're calling everyone on a list. As you progress you filter the list based on the level of interest each prospect has. At the same time, you remove the bad data (contacts who have moved away, etc) and the people who are just not interested at all. So, after a while, you end up with a much more targeted list of people with at least some level of qualified interest.
Now, one thing that will remain pretty constant is what we call the "pitch rate", also referred to as the # of DMC's (Decision Maker Contacts). That's the number of decision makers you speak to in a given length of time (we measure it per day). Each industry sector, type of business and level of authority will have it's own pitch-rate. It remains constant because you're still calling the same people.
But, if the pitch-rate is constant but you're now calling a more qualified list, your strike rate will go up.
If your list initially has 50% "interested" prospects (ranging from mildly interested to hot-to-meet-you-now interested) and you pitch 20 decision makers a day then only 10 are going to be interested, right? (50% of 20 pitches, stay with me).
Once you've qualified your list, you're still pitching 20 a day but now 100% are interested, making you twice as effective as before.
We advise clients to think of two distinct phases of a campaign.
The initial phase is what we call the "build" phase. This is where we're least efficient as we're filtering and qualifying as we go. It's often best to have a higher level of resourcing (subject to budget) at this stage to get traction faster.
Once we've qualified much of the list, and determined the most appropriate contact frequency for each classification of lead, we're left with a much tighter database of prospects.
This is when we move onto our "maintenance" phase.
The resourcing level for this phase can be half or even a third of the build phase. Some of the leads with lower levels of interest may only require a call every 90 days, backed up with regular email marketing. However, because we're now more effective at this stage, we can produce the same results as we did in the build phase.
In the maintenance phase the ROI is at least double that of the build phase.
To me, when a company stops a telemarketing campaign at the end of the build phase it's a criminal waste of money. All that hard work in qualifying the database is just thrown away and, without nurturing those lower level leads, they'll just go cold (or go to your competitors).
As I said at the start, telemarketing can deliver short-term results but that really is the tip of the iceberg.
If you invest in telemarketing over the long-term you'll start to build a process that delivers a steady flow of new business opportunities with an outstanding ROI.
Labels: telemarketing agency, telemarketing ROI