7 Smart Ideas For Telemarketing: Working The Phones

Byline: DEBRA JUDGE SILBER

With Internet and email the hot topics these days, hawking subscriptions by phone may seem like yesterday’s news delivered with last century’s technology. But until subscribers stop misplacing requal forms, start remembering to send in their checks and quit ignoring their in-boxes, telephone sales will remain a necessary channel for reader renewal and acquisition.

If anything, the newer channels are but additional rungs in a marketing ladder in which telephone remains a critical step. “The telephone used to be an entity unto itself, but now it’s totally integrated into the marketing mix,” says Gail Stone, president of PTM Communications. “If you don’t get enough mail responses, fax responses or email responses, you have to go to the phone.”

Reserving telemarketing as an effort of last resort – the most popular prevailing strategy – does make economic sense. Phone is a relatively high-cost effort, but its robust response rates, even among subscribers who’ve been emailed and faxed and mailed ad infinitum, make it a relatively dependable clean-up hitter.

That success in itself works against developing new telephone strategies. “A lot of publishers treat telemarketing like a manufacturing process – they find something that works, and then turn the motor on and let it run forever,” said Sandy Clark of Clark Consulting in Darien, CT. The miserly economy has only encouraged the status quo. Trying to make the most of restricted budgets, circulators over the last several years seem to be delaying phone efforts further and further, until the last possible moment. The result, notes Joan Marcus, senior VP, Lester Inc., is less experimentation and less time to take advantage of one of the telephone’s biggest advantages over other sources – its potential for prompt feedback and adjustment in mid-campaign.

Discussions with magazine circulators largely bear out-these observations. When it comes to subscription efforts, many said their phone use followed the usual pattern. Consumer magazines continue to employ it sparingly and strategically in their renewal series and barely, if at all, for new acquisitions – a trend nearly assured by enactment of the FTC’s new Telemarketing Sales Rule. And while an overall increase in telemarketing has made big news with controlled circulation titles – according to the latest CM survey, telemarketing is expected to account for 30 percent of controlled subscriptions this year – many circulators are quick to admit the increase in volume has yet to be matched by an equal measure of innovation.

Making telemarketing work comes down to making the cost of telemarketing pay off. And there are ways to do this that don’t involve waiting until expire or launching a last-ditch campaign before handing an auditor your numbers. Here are a few:

* TARGET YOUR PHONE AUDIENCE

Calling every subscriber at renewal is a waste of money and a surefire way to annoy a group of good customers. But it does make sense to identify that subset of subscribers who respond well to the phone – their high response rate can balance the cost of calling early, particularly if it saves on mail efforts they habitually ignore.

Controlled books, whose phone-source subscribers are broken out on circulation statements, already have that information front and center. “We know people in the telecom source in our BPA statement are going to have to be called,” says Peggie Kegel, circulation director for Advanstar. “So we start right away rather than waiting until the last minute.”

Joy Puzzo, circulation director for Thomson Medical Economics, said her cost per order fell by half after telecom subscribers for the company’s two controlled veterinary titles were separated out and phoned rather than mailed or faxed to. “We found the people who responded by the phone – when we broke it out – were the ones we were getting minimal responses from at best through direct mail or tip-ons,” she said. Those who renew by telephone account for about 25 percent of the file.

While targeting phone-sold names can help avoid wasting money on unanswered mail, a phone effort may also boost renewals on subscription sources with traditionally low renewal rates. Joyce Shirer, VP, circulation, for the Men’s Health and Sports Group at Rodale, has found telephoning agency-generated subs can make the difference between losing those customers at renewal and retaining them – hopefully with some lifetime value – as direct-to-publisher names. She now targets agency subs with a mid-series telephone effort, after tests showed that the response rate for a phone effort to those subscribers at that time was 25 percent higher than that generated by mail. Though the phone effort can cost four times as much as mail and only a portion of the names on the file can be reached by phone, she said it’s worth it to bring those subscribers – whose renewal rate as a whole typically runs 10-15 points lower than other sources – on board. “Once they’ve renewed through us one time, they’ll renew like any other subscription,” she said, adding, “We look at it in terms of how much we’d have to invest to get those subscriptions as new business.”

* LET UPSELLING PAY THE WAY

For paid books, renewal by phone provides an unmatched opportunity to upsell – either to a longer term, an automatic renewal, or additional subscription – all of which can offset the cost of a phone effort.

“One of the things we struggle with is that fewer and fewer people are answering their phones,” says Ernie Vickroy, director of telemarketing for Time Consumer Marketing, which works a low-key upsell on virtually every phone call. “What upselling has enabled us to do is keep our cost per order flat while we’re reaching fewer people. It’s enabled us to keep trying to contact customers.”

The ability over the phone to sell term is what allows Highlights for Children to use telemarketing efforts from the beginning of its renewal series, says Alan Bayersdorfer, VP, customer marketing. The magazine relies heavily on telemarketing, with about 50 percent of its renewals taken by phone. “It’s very hard on paper to sell a three-year subscription,” says Bayersdorfer, “but we can sell three years on the phone easily.”

At Time Inc., phone is the leading medium for selling auto-renewals on core titles such as Time, Sports Illustrated, Real Simple and People. Subscribers who pay over the phone with a credit card are consistently offered an auto-renewal option, says Vickroy, and 98 percent accept it.

“I think one of the biggest reasons people don’t want to move into an auto-renewal program is they think they can’t get out of it,” Vickroy says. “If they’re on the phone, they can ask, ‘How do I get out of this?’ In a phone call, there are no asterisks. We can provide them with all the information.”

Likewise, Vickroy says he’s found a telephone approach worthwhile for combination sales. “If we have a complicated sale, obviously the phone is a better way to explain it. If you think about a direct mail piece, the customer doesn’t really know where to focus. On the phone we can give them information on a need-to-know basis, and focus them on the important pieces of the sale.” Time recently concluded a test to People subscribers offering a subscription to Teen People at a combined price upon renewal. Overall response to the phone effort was more than twice that of a cover wrap, said Vickroy, and more than half of those renewing took the Teen People offer. As valuable as the opportunity to upsell here was the ability to downsell – to allow subscribers not interested in the featured offer to renew on their own terms, Vickroy said. “What’s important is it did not negatively impact our response to People renewals at all – we got the same response, but we were able to generate incremental subs on Teen People.”

* FINESSE YOUR FILE

On controlled titles, phone efforts can pay off by focusing acquisition efforts on the most desirable and – in the end, cost-effective – subscriptions. By telemarketing to one of his more successful direct mail lists, Don Roth, circulation manager at Thomas Publications, saw responses increase from between 2 and 5 percent to between 13 and 15 percent for Industrial Equipment News and Managing Automation. At those rates, the phone effort yielded enough subscriptions to allow him to stop calling less than halfway through the list. As a result, the cost per order on Managing Automation dropped by half. By going to the phones, Roth said, “We were able to realize significant savings with new-name acquisition.”

Crain Communications is using telemarketing with some success to increase the penetration of Workforce Management within targeted Fortune 1000 companies, according to circulation director Philip Scarano. The effort targets subscribers at select companies with phone calls and not only requalifies them, but also asks for additional names under specific titles. The effort, which is ongoing, has thus far resulted in 1,000 re-qualifications and 270 pass-along names, which were added to the subscriber list as company requests. An effort will be made to convert them to direct request at renewal, Scarano said.

“One of the goals we had set on this publication was to reach a certain demographic, a particular company size, and the best way to do this was to go through those people we already have,” Scarano said. “We were really looking for specific titles and levels. It’s not just pulling a list of two-year-old names and calling them, but taking the list and saying, ‘Where are the key companies and individuals we want to have on this file?'”

* INTEGRATE CHANNELS

Filling out a long requal form over the phone takes time and patience – something subscribers to CRN and VARBusiness may find they have less of than they thought when they initially took the call. An answer, says Shannon Aronson, director of corporate audience development at CMP’s Technology Solutions Group, is to send an immediate email to the subscriber linking them to a Web page that picks up the questionnaire exactly where the phone conversation left off. Aronson said she’s found that if the subscriber has already committed 10 minutes to the process – which on the phone can take twice that – the survey more often than not comes back completed. While she could not say how many callbacks the emails eliminated, the savings realized by replacing those callbacks with five-cent emails have been “significant.” She also points out the strategy’s value as a customer service.

While circulators practically assume some mailed efforts will be followed up by phone, Scott Fujan, director of sales and marketing for Meyer Associates Teleservices, makes the point that phone efforts deserve some follow-up as well. His suggestion: Ask permission to send a follow-up email on each telemarketing call, even if the solicitation ends in a decline. Then send the email immediately.

“It’s a great way of saying ‘thank you for your time,’ but it’s also another touch with the subscriber,” Fujan says. The email could provide a link to the magazine’s Web site for subscribers on the fence, or, in the case of paid subscriptions, could provide an opportunity to pay online for those hesitant about giving credit card information over the phone. On a typical B-to-B file, email addresses can be obtained in more than half the calls, Fujan says, adding that the follow-up emails add only pennies to the cost. “I don’t think publishers as a whole say thank you to their subscribers enough,” he said, “and for six cents you can’t afford not to.”

* EXPLORE AUTOMATION

Automated phone messages work well for some titles and barely at all for others, but most circulators report some lift. The net response is much lower than live calling, but then so is the cost – and phone messages can be effective in reaching those subscribers who simply don’t respond to mail. “You can’t compare the response rates head-to-head,” says Greg Wolfe, president, Circulation Specialists Inc. With automated messages, he says, “I can get a group of people I’m not going to get with mail no matter how many times I mail them.”

Tests this summer demonstrated that an automated message could be effective in requalifying 2-and 3-year names at two Advanstar titles, and at a lower cost per name than straight telemarketing, according to Kegel. In both cases, more than 70 percent of the recipients listened to the message live; in about a third of the calls, a message was left for the subscriber directing them to the publication’s Web site with a priority code. Interestingly enough, on one test, 3 percent of recipients who missed the message used caller ID info to return the call and requalify.

In the end, one effort yielded an 11 percent response with a cost per sub of $2.25; the other, a response of 21 percent, and a cost per sub of $2.00. “We spend more than that on just straight telemarketing,” Kegel said. “So we’ll do this again.”

* DEAL WITH “DO NOT CALL” EFFECTIVELY

It’s hard to know what customer reaction to telephone solicitations will be in a post-Telemarketing Sales Rule-world, but even in cases where calls are allowed, publishers are treading with caution.

At Highlights for Children, they’ve already done lots of homework.

“We’re struggling because our business is so dependent on the telephone,” said Bayersdorfer, who said that while renewal calls are legally allowable, the magazine was being “very conscientious” about that process, and started testing consumer reaction quantitatively last year. “For the last four months,” Bayersdorfer said, “We’ve been looking at every single disposition for customer reaction.”

The results? “Customers on a DNC list are no more or less likely to complain about a telemarketing call than a customer who’s not on a DNC list,” Bayersdorfer said. While that may provide a measure of relief, it doesn’t guarantee consumer reaction after Oct. 1 – and so Highlights has already revamped its scripts to answer DNC-related complaints.

Because customer response is uncertain, Time Inc. plans to suppress DNC names on their renewal series for the next three months – even though the rule would allow those calls. “Legally it’s not going to affect us, but customers will be confused,” Vickroy said. “Our strategy is that in the last three months of the year, as the cold calls decrease as a result of the list, people will become more receptive,” he said. “We tried that strategy with some of the state lists and it worked pretty well.”

* LISTEN IN

“Sometimes we plead with circulators – somebody, please, listen to the phone calls,” said Lester Inc.’s Marcus. While vendors can identify and report problems, circulators who take the time to listen in on telephone efforts themselves come away with a better picture of why an effort is or isn’t working. And that, Marcus notes, is a primary benefit of going to the phones in the first place. “You can do a mailing to 800,000 people and never know why they didn’t respond, or make phone calls to 400 people the first day and know immediately what’s wrong,”

Telemarketing, which accounts for about 43 percent of circulation on Aronson’s books at CMP, is particularly crucial in the niche markets the company serves. So making the effort to monitor phone work is crucial. Aronson makes sure she listens in for three to four hours over the course of each large campaign, and pays a visit to the call center itself at least once a year. Monitoring telemarketers’ courtesy and effectiveness is one goal, but, says Aronson, “I think it pays off in a different way as well when agents can put a face behind the people they’re calling for.” Listening in has also shed light on problems that might otherwise have gone unnoticed. At CMP, for example, listening in made circulators aware that agents were having difficulty with some of the technical language used on a particular requalification form, and the problem was corrected.

If you’re going to invest in telemarketing, you should also invest the time in making sure it’s getting done to your specifications. And remember, done right, working the phones can work to drive up circulation.

Making Banner Ads Work

Brownstone Publications Health Care Professionals