I was chatting with a client the other day and they told me something that hadn't occurred to me previously.

They said that one of the things they liked about us is that we're not based in London.

Why? Because they found that london-based telemarketing agencies have trouble retaining telemarketers as their people are more transient in nature, only taking the job for a while before moving on.

And that does make sense, because when you think about many of the large call-centre or volume telemarketing agencies are located in areas outside London, usually lured there by local grants to boost employment.

But, beyond that, what does it really say about telemarketing agencies?

It says that most people will only work in one either if there is no alternative or they are "between" jobs.

Someone, who used to be a "team leader" in such an agency in a previous life, once told me how they used to literally drag people off the streets to put "bums on seats" and then bank on a few of their top performers to bring up the average and rescue the campaign.

So, why is this? What's wrong with most telemarketing agencies?

Typically, it boils down to a few inter-related areas:

1) Retention or "churn" - call-centres and volume telemarketing agencies have the highest turnover of staff than pretty much any other industry. Why? It's simple: they are terrible places to work and not everyone is suited to telemarketing.

Now, I'm not sure whether this is a "chicken or egg" issue, since if they were better places to work would they have less churn? But the fact is that the volume telemarketing game is a soul-sapping experience. This means that they have to recruit more just to keep the numbers up (since their business model is essentially selling resource) which in turn causes the quality to drop (as outbound telemarketing isn't for everyone) and so on, and so on.

Which brings us to the second issue:

2) High-cost base - all that constant recruitment, training and management costs is expensive. Add to that the technology overhead to record and monitor everyone and you can understand why telemarketing agencies run on wafer-thin profit margins. On top of that consider that telemarketing is a mature, highly competitive and price driven market and what's going to happen?

Margins get squeezed and with all that fixed overhead can they really afford to pay to retain the best talent? Which leads to...

3) Talent Drain - what happens to the best telemarketers? Do they become managers? Well, there's only so many management roles available and, realistically, the best telemarketers don't want to be a "manager". In our team we have people who have been there, done that and never want to go back. Great telemarketers (believe it or not) like telemarketing.

Do you pay them more? Maybe you can make them a "team leader" and pay a little more but there's only so much margin in this game. All that overhead, recruitment costs, management costs and the fancy BMW's parked outside for the account managers soon rack up.

So, what happens is that they leave and go freelance. As a freelancer they can be selective about the work they do and, if they team up with an associate model like ours, they can get a steady flow of quality assignments without the hassle of dealing with other telemarketers, account management, etc.

More money, less hassle.

And the traditional telemarketing agency has to replace them, which brings us right back to the first point, "churn".

For me, the model is broken and it's why I didn't set up a traditional telemarketing agency.

We work exclusively with seasoned telemarketers of the calibre most telemarketing agencies would kill for. We provide them with a steady level of high-quality, ongoing work which they would struggle to secure as a stand-alone freelancer.

The value we deliver for our clients is through offering strategic input and ongoing campaign management without the overhead of a traditional agency.

Essentially, our model provides a higher level of resource and service for less cost than a traditional telemarketing agency.

Think of it like this. The only way a traditional telemarketing agency (by which I mean a bricks-and-mortar location, technology overheads, account management teams, etc) can charge lower fees than our model is if they pay their people less.

And you know what they say about paying peanuts...

Labels: freelance telemarketing, outsourcing telemarketing, telemarketing agency

According to a recent survey in January's B2B Marketing Magazine "telemarketing remains a key part of the marketing mix for most B2B brands".

Unfortunately, the report doesn't specify the size of businesses surveyed, although I suspect most are medium and large sized companies since only 15% of the respondents relied entirely on external telemarketing agencies and "the largest portion of respondents had an internal telemarketing team"

It was interesting that the most popular reason why telemarketing was retained internally was because "the complexity of products and services makes outsourcing difficult".

The best way of thinking about this is to consider why these companies see keeping telemarketing in-house for complex sales proposition easier than outsourcing.

In my view, the primary reason why it would be seen as difficult to outsource telemarketing is the quality of the telemarketers.

Let's be honest, even the best call centres struggle retaining their people. They have one of the highest rates of employee churn than any other industry. If you have a complex sales proposition then you need to invest in training your telemarketers plus they have to be a pretty high-calibre to start with.

Therefore, when you outsource your telemarketing you run the risk of having to train and re-train telemarketers. Retention is always the biggest issue.

If you're a large company you can avoid this simply by hiring your own telemarketers and paying them above the industry average. Most good telemarketers in call centres would jump at the chance to get out.

Why do you have to be a large company to do this?

As I've blogged about previously, Outsourcing Telemarketing vs In-house, the case for in-house telemarketing just doesn't stack up for small businesses.

Simply put, it is too difficult for most small businesses to manage and retain top-class telemarketers.

So if you have a complex product or service, what are your options?

The answer is to find a telemarketing agency that retains the caliber of telemarketers you need. Almost always, this will be a small agency rather than a large call centre.

If a telemarketing agency starts talking about having 100's of employees with account managers, systems, processes, etc then you can guarantee that they're a volume body shop.

However, if they're a small outfit who can provide you with personal direct access to the telemarketers making the calls, and will invest time in training their people to understand your proposition then you're on the right track.

But then again, if you're reading this blog post then you've already found us :-)

Labels: b2b marketing, b2b telemarketing, outsourcing telemarketing

The other day I was speaking with a prospective client who was considering outsourcing telemarketing after his in-house telemarketer "left and never returned".

I asked how long the telemarketer had been working with him and he told me just 4 days!

Was he any good? "Oh yeah", says this guy, "He made about 20 or so calls a day and got us a meeting before he left"

20 calls a day? One meeting after 4 days work? Oh please...

That pretty much sums up the experience of many businesses who have tried to hire people in-house to "do some telemarketing". I know, when I ran a UK sales team I hired and trained telemarketers. The trouble is, good ones are just hard to find.

What usually happens is this:

During the interview they tell you that they've had some experience telemarketing. Which is true, pretty much anyone who's been in some sales or admin role will have had to do a little cold-calling.

So, you set them on, give them the training and then they go hard at it. If you're lucky, they make plenty of calls, turn up some leads and even book some meetings.

That's week one over.

Then, as sure as the sun comes up every morning, their performance starts to tail off. They start telling you the leads are drying up. And - I guarantee this - they start to "help out" with a few jobs around the office.

It could be some filing, maybe helping with the marketing, or even "researching" online. If someone in the office goes off ill, they're in their seat like a shot. Before you know it, one day soon, you'll wake up and realise that they're no longer making those calls.

Why does this happen?

The reason is simple: very few people like to make cold calls.

Why do you think the average staff churn in most telemarketing call centres is close to 50%? People who can do this job and are any good at it are like hens teeth.

Most people would rather crawl over broken glass on bare knees than pick up the phone and start cold calling (and that includes most salespeople).

If you really want an in-house telemarketing team, expect to invest heavily in recruiting, managing and retaining them. Unless you have a market that can support two or more telemarketers full-time, it simply doesn't make sense to create an in-house team.

Outsourcing telemarketing to a professional telemarketing agency really is a no-brainer for most businesses.

For one thing, it's more flexible. Only need someone for a day a week? Need to halt a campaign, stop during the holidays or avoid specific times within your industry? By outsourcing your telemarketing to an agency that's not a problem.

For example, we work on monthly retainers for many clients, but will take a break whenever it suits ours clients best. That's the kind of flexibility that's not possible with employed in-house staff, even part-time ones!

Also, by outsourcing to a telemarketing agency that works with seasoned telemarketers (like ours, of course), you'll work with experienced people who you simply wouldn't find on the open market.

As I said earlier, very few people like to do this work and are good at it. If you hire someone with little experience then cut to the chase and ask them to start filing.

Quality telemarketing professionals are the ones who do this for a living.

Even the costs of in-house telemarketing vs outsourced seldom stack up.

OK, so you will be able to pay someone to work in-house for less than an agency. Of course, there's a whole bunch of hidden costs you'll incur such as holidays, sickness, management time, IT costs, training, etc, but even with these added, the total "costs" may still be less, pound for pound, for an in-house person compared with an outsourced telemarketer through a professional telemarketing agency.

But, it's not the costs you need to consider - it's your return-on-investment.

Even if an in-house telemarketer costs you half of an agencies daily rate, they will struggle to deliver a quarter of the results of an experienced pro.

What did that guy tell me at the start of this post? His in-house telemarketer had worked with him for 4 days, made 20 calls a day and got him one meeting. No professional telemarketer would survive on those ratios - they'd have no clients.

Outsourcing telemarketing to experienced, seasoned professionals will give you a superior return-on-investment compared with in-house people. Sure, hour-for-hour, day-for-day it might cost more to outsource telemarketing, but if your in-house people deliver a fraction of the results (and they will) then it's an irrelevant comparison.

Any experienced telemarketer worth their salt will produce at least 4x the results of the type of person you're likely to attract for an in-house role.

Plus they'll do it day after day, consistently, without you having to manage them.

And, they won't ask to do the filing :-)

Labels: b2b telemarketing, outsourcing telemarketing, telemarketing agency