Telemarketing and nuisance calls are under the spotlight, with the Government publishing its Nuisance Calls Action Plan last month. The industry consultation is looking at whether fines for nuisance calls should increase and whether the threshold for punishment should be lowered.
While unwanted cold calls from PPI providers and other scams have hit the headlines, big brands continue to use direct marketing by phone. Why are these calls so popular when experience suggests customers are hanging up in droves?
Primarily it is because brands are finding that, given permission from customers, using telemarketing can be effective. Permission is either explicit in terms of opt-in or opt-out options chosen via other channels such as websites, or implicit in the form of service-oriented calls to existing customers. The era of cold-calling is over for any brand that values its reputation.
“Most marketing is multichannel and marketers doing a good job will respect customer preferences,” says Direct Marketing Association (DMA) chief of operations Mike Lordan. “Good marketers choose the preferences that suit the customer best and customers expect that if they provide their telephone number, they can expect to be called. The key is transparency. Customers need to know what they’re signing up for. Hiding warnings deep in terms and conditions isn’t acceptable in the current climate.”
Marketers are treading carefully in this area. “We don’t do much in terms of outbound telephony or mobile because we see it as an intrusive and intimate channel,” explains Barclaycard head of marketing, communications, planning and development Alex Naylor (see case study, below).
“We call only for serious customer service issues where people have requested clarification or to examine potential fraud. The phone has huge benefits for diagnostic purposes as we can resolve issues and it’s good for security, but we do not cold-call.”
The Telephone Preference Service (TPS), run by the DMA, launched the TPS Assured scheme in September 2013 – a voluntary accreditation showing that signatories have satisfied a set of telemarketing criteria that is more stringent than the existing law.
“We support the government’s Nuisance Calls Action Plan which is lowering the burden of proof to take action against companies abusing telemarketing. At present, we need to prove substantial distress as opposed to causing a nuisance. But we need more action to drive rogue companies out of business, particularly companies selling PPI,” says Lordan.
On 11 April the DMA expelled agency Reactiv Media from its membership after the Direct Marketing Commission (DMC) received complaints about unsolicited live calls on PPI misselling between April and September 2013. The DMC found failures over consumer consent, the requirement for named third-party permissions and identifying themselves when making calls.
Some companies use outbound telemarketing as a sales strategy but insist that all permissions are adhered to. Advances in technology mean people can be better targeted, says Martin Troughton, Anglian Home Improvements marketing director.
“We do use telemarketing both in terms of in and outbound, which does involve cold-calling or in response to a trigger. Multichannel is important because a lot of business comes from people who have been to the website and asked to be called to make an appointment. But we are using technology that wasn’t even available six months ago to make sure we don’t upset them,” he says.
The company’s outbound dialler checks mobile networks to ensure that the phone is switched on and is in the UK. “Disrupting customers is the last thing we want to do. We don’t want to ring them on a beach in Spain,” he adds. Troughton also notes that outbound calls only reach TPS opted-in consumers. With 42 per cent of the company’s sales coming from existing customers in any one week, avoiding being a nuisance is critical.
Multichannel is also influencing the recency and frequency elements of brands’ contact strategies. Web chat and text messaging blur boundaries where contact may have been the preserve of the voice call. Anglian has increased the complexity of its ‘contact mapping’ when customers make web queries.
Good marketers choose preferences that suit the customer best
“If a customer puts an enquiry on the website, a company would simply have tried to call them every three hours until there was a resolution,” says Troughton. “We try to contact the customer as soon as possible, then again later in the afternoon, following with a text and then again in the evening. If there’s still no response, we will contact them the next day at the corresponding time the web query was made and finally email with a number that the customer can call back on.”
Integrating mobile, both in terms of text and voice calls, is proving critical to encourage potential customers to complete a sale while removing the element of intrusion (see case study).
Text messages can often help seal the deal, says children’s holiday club SuperCamps senior marketing executive Mark Travis.
“Through the website and emails, we try to get customers to come to us for more information. But mobile is a time-sensitive channel. We send emails the day or evening before a booking window closes when people are at home.
“If they want to book, they can do so online but at that time of day there isn’t someone they can call. However, we’ll follow that through the next day with a text and a hyperlinked number and people at SuperCamps are ready to take the call.”
Approaching telemarketing via mobile as a direct response tool chimes with Hotels.com president Johan Svanstrom. At Advertising Week Europe last month, he said that while executives were discussing how to use mobile as a brand engagement tool, its most significant use is as a “performance channel” that is useful in getting people “down the funnel” towards transactions.
Using outbound text to generate direct response is an inexpensive form of push marketing while remaining manageable from a servicing point of view, said Travis. “We do get a peak in calls when we send out 10,000 texts, for example, but not everyone is calling in. It would be expensive for us to hire people to man an outbound call centre but we need a few people to phone us back from an outbound text campaign to recoup the cost.”
Recognising the ‘value of voice’ is also a solution to mobile marketing strategies. An ongoing concern for brands engaging in this is that the trigger email or text will link to a web experience that is less than optimal on a mobile device.
“It’s amazing how easy it is to forget the need for mobile-optimised environments when you’re driving people to your sites from a text. It could damage the experience and it’s a strategic filter for us when looking at our messaging. Some strategies we will have to build later because we have to build the appropriate landing environment,” warns Barclaycard’s Naylor.
However, if the data and operator training is robust enough, driving customers from text to inbound calling removes that danger. Anglian’s Troughton says: “A conversation is the most social media you can have. If you train people correctly, you can have a positive conversation. We have a high value product – our average appointment value is £700. So each conversation is worth that.”
Integrated data is also an important part of telemarketing’s success, particularly for Anglian, where it is used mostly with existing customers. “Sales and service are a single department and outbound sales calls are immediately suppressed if a service call is logged. They remain barred until the customer has been contacted to check that the issue has been resolved to their satisfaction.”
Bringing together data streams is proving to be a greater challenge in making telemarketing work in a multichannel, customer relationship management environment.
“We’re not great at marrying data,” admits Travis. “We can track open and click-through rates on emails and we have data on who we sent text messages to so we can cross reference with the numbers on our database, but it has to be a manual look-up. It would be valuable as a resource but it’s not something we have at the moment.”
While telemarketing as an initial point of contact for pure customer acquisition is a no-go area, it is valuable as a second point of contact stemming from a customer’s interaction via another channel. In particular, it is vital for the large yet often forgotten ‘disconnected’ customer segment. “You’ve got to remember that not all of the world is connected,” says DMA’s Lordan.
It is tempting to believe that because the digital functionality is available, most customers prefer to use self-service via the web. But with 7.1 million UK residents having never been online and 16 million with only basic digital skills, telemarketing sparked from direct mail, print or television advertising can be a critical point of contact.
Case study: Barclaycard’s four mobile messages
Barclaycard has undertaken extensive testing to determine both the most effective messages to send to customers via text and those that will cause the least opt-out and may encourage an increase in the numbers of people who opt in.
The four areas it has identified are broadly defined as confirmation of action, self-selection, relevant triggers and updates. Barclaycard texts people to confirm they have made a transfer online, which reassures them that the activity has taken place, as a ‘confirmation of action’.
Self-selection is based on different triggers that customers set up themselves to allow Barclaycard to contact them. For example, when a spend threshold has been reached it will send their account status on a particular date.
Relevant messaging is triggered when the company can see via the customer’s transactional data that they may be missing out on product-related benefits. This may be through Barclaycard’s Freedom Rewards scheme if customers are failing to redeem points or using a different retailer than their usual one where they would be able to gain greater benefits.
Updates are triggered by external events where certain customers may benefit from extra support. In the case of the floods in Central and Southern England, Barclaycard customers in those locations received texts asking if they needed help or advice to deal with flood damage.
Top tips for telemarketing
Have robust policies in place
According to Anglian Home Improvements, 42 per cent of weekly custom that is elicited via telemarketing comes from existing customers. Other companies say their primary telemarketing contact with customers, particularly in outbound calls or texts, is focused on customer service.
Central to managing the customer relationship via phone is having robust data policies in place. This is both from an adherence to the Telephone Preference Service and information commissioner perspective. Managing data streams also reduces unnecessary contact and helps determine the best triggers.
“Cloud-based systems make it easier to access data. Even if you believe you have a single customer view, there are multiple access points and systems where data is being uploaded. All Anglian phone lines are routed through the cloud,” says Anglian marketing director Martin Troughton.
Use multichannel to the full
“Channels can’t live in isolation. Online, offline, social and website – they all have to be integrated,” explains SuperCamps senior marketing executive Mark Travis.
It could be argued that anything other than an outbound voice call is not strictly telemarketing. It is clear that successful telemarketing today involves customer permissions originating from many other interactions including TV ads, direct mail, websites or social media.
If, as Travis says, mobile is time-sensitive, then marketers need to ask themselves how to manage not only what the message will be through the mobile channel but what the customer reaction will be, when and through which channel.
Scrutinise your suppliers
“TPS Assured shines a light in every corner of your business,” Troughton explains. “It vindicated what we were doing in some areas and tightened up others. In one instance, the audit asked if we had gone upstream and checked if the suppliers of our contact lists [lists bought from third parties of customers who indicated an interest in Anglian products] were getting the correct opt ins.
“We no longer deal with three of the six original suppliers. We thought we were going far enough and found that we needed to go further.”
Marketing Week’s Michael Barnett warns brands to monitor their suppliers’ suppliers, as lead generation is a multi-layered industry. To read his views on cold-calling click here.