One of the first things that anyone considering telemarketing wants to know is "how much does telemarketing cost?" or "what is your pricing for telemarketing services?".

Of course, many telemarketing companies answer this question by just quoting a daily rate, or you can look at the many services online that will take your details and then sell them on to 4 or 5 hungry telemarketing companies who will pester you for days to give you a quote when all you really want to know is "how much is a telemarketing campaign going to cost me?"

If you could just get a sensible, grown-up answer to that question you could decide whether it's worth considering further.

So, we thought we'd take a different approach and actually try to answer that question in a way that not only makes sense but actually provides you with an idea of return-on-investment (ROI).

You see, telemarketing costs are only part of the picture.

What you really need to consider is "what can a telemarketing campaign deliver in terms of revenue".

Now, the answer to that depends on a number of different variables, ranging from your target market and the brand equity you have within it, through to how many sales you can convert from meetings and what is your average revenue per sale.

Lots of things to consider, eh?

So, to help you, we've developed a simple telemarketing budget calculator in Microsoft Excel.

Once you open the excel sheet, all you need to do is select a number of variables, such as "What size of business you are targeting?", "What is your approximate budget?" and "What is your average revenue per sales value?" and the calculator will tell you what ROI you should expect for a given telemarketing budget.

You can adjust the budget (as well as the other variables) to change the ROI.

Is it perfect? Does it work for any telemarketing scenario?

No.

It's based on our experience working with business-to-business product and services companies who are targeting new business.

Generally, new business is as tough as it gets for telemarketing. If you want someone to call existing or lapsed customers then you can expect a higher return than our calculator will produce.

Also, most of our clients are not well-known brands. We have worked with a few big names and I can tell you that is makes telemarketing so much easier. So, again, if you're Microsoft, Accenture or IBM, you'll certainly out-perform our calculator in terms of ROI.

However, if you're looking to use telemarketing to generate new business in a competitive but targeted market then our model will be accurate enough for a sense-check on budget.

Also, in some circumstances the calculator shows a negative ROI.

Well, guess what... telemarketing probably isn't for you.

For most companies with a medium to high-value business-to-business sales proposition telemarketing still remains one of the most predictable and consistent methods of opening doors and generating new business.

Why not download our Telemarketing Budget Calculator and see if telemarketing could work for your business?

Labels: b2b telemarketing, new business development, telemarketing ROI

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

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

One of the things we're finding in the current economic climate is the need to recalibrate success metrics for telemarketing campaigns. Essentially, we need to re-think the number and type of meetings that can be delivered for a given number of days effort.

Some of this is sector specific and some of it holds true across all sectors.

Generally, if you'd asked any seasoned telemarketer at the beginning of 2008 how many meetings they could book in a day it would roughly equate to 1 per day.

A "deal a day" has been the unofficial benchmark for B2B telemarketing.

And, for clarification, I'm talking about senior level, well qualified meetings, not just a 15-minute coffee that's been squeezed out of a prospect and has a 100% chance of being bounced.

So, what's changed since early 2008?

Actually, you know what's changed; we've entered one of the most severe recessions experienced for decades.

What this means from a telemarketing perspective is that it's become harder to get meetings but, ironically, the meetings are much better quality.

Think about it. When times are good, budgets are plump, people are generally more open to looking at new ideas and exploring new relationships. Bringing in a new agency, consultancy or vendor to pitch their credentials is the norm.

However, when budgets have been cut off at the knees and you're wondering whether you've still got a job (or a business) in the next 3 months, you're going to restrict your time to things that have both a short-term impact or are critically aligned with the business agenda.

This means two things:

Firstly, it's essential that your pitch hits those hot buttons. OK, the time-line may vary depending how strategic your proposition is, but unless it cuts directly to what's on the business agenda right now, it's going to fall on deaf ears.

Secondly, if they are interested, you can bet it's hot one.

People just won't meet you to shoot the breeze at the moment. If they've agreed to see you it's because they need your help.

We're finding that businesses which hit those hot buttons and can deliver a rapid return-on-investment without large capital investment are still getting traction.

Sure, the "one deal a day" rule could now be more like one deal every two or even three days, but if the trade-off is high conversions, shorter-lead times, etc then telemarketing can still be one of the best direct marketing mediums for high-end B2B lead generation.

Labels: b2b telemarketing, telemarketing agency, telemarketing ROI, telemarketing services