As my regular blog readers know, before becoming a marketing recruiter I owned a B2B inside sales consultancy called "Reliable Growth." Essentially, I taught companies like NCR and Aflac how to research, identify, and develop new business with a phone, an internet connection and a fax machine.
Telemarketing was the lynch-pin of my campaigns.
My campaigns always involved tightly choreographed, sequential steps and sought to establish permission-based relationships with highly targeted prospects over a 6-8 week time frame. Each interaction was like a chess move. You can see the gist of the method in this page from my old manual. This small portion of my process is based on the un-improvable work of Jim Cecil — the father of nurture marketing.
Needless to say, I know a thing or two about cold calling. Indeed, I have made many thousands of ice-cold calls in my life — and if the telephone were a slot-machine, I would be waaaay up in my winnings.
But there’s rejection — and lots of it.
After all, a cold call interrupts the prospect’s day. It’s an intrusion, and most folks don’t like to be intruded on. The cold call loser focuses on this element and takes the rejection personally. The cold call winner simply "moves through the target" (as they say in the Navy SEALS) by regarding cold calling as a numbers game.
Here are five basic truths about cold calling:
- You cannot wait for the phone to ring. You simply MUST reach and touch your prospect. After all, no one is waiting for your call.
- What gets measured gets done. "How was your day?" Good question! There’s nothing as devastating to an opinion as a number. Get yourself a contact database and track your outbound dials. If you don’t count your dials, your production will lag.
- The best campaigns involve multiple steps, such as 1.) calling the prospect to verify that s/he is in fact the decision maker, 2.) asking them three closed-ended questions about their current situation — thereby disqualifying most prospects as potential new customers, 3.) getting the qualified prospects’ permission to send them a HIGHLY PERSONALIZED sales letter, 4.) FAXING the letter, then snail-mailing it the same day, and then 5.) following up no more than 72 hours later to verify their receipt of the letter, answer any questions they may have, and mutually agree on the next steps in the relationship. To position yourself as a potential resource for institutional buyers, you must be "unintrusively persistent" in your approach: Our society is famously over-communicated, and B2B prospects are very good at tuning out marketing messages — especially if they "already have a supplier of what you’re selling." You must have a reliable process in place to address this reality.
- The most successful reps are "light on their feet" and can talk outside of the script. Patter works better than droning.
- The best reps know their product inside-and-out and can put their product "solution" into the context of how the prospect thinks, how they buy (logical vs. emotional), what they fear, what makes them mad, what are their top three daily frustrations, etc.
Which brings me to the point of this blog post:
Today on iMedia, Sean Cheyney, VP of Marketing for AccuQuote, has a nice piece called 5 Ways to Screw up a Cold Call. His tips include …
- Make your own calls: Using appointment setters can be dilutive to the brand and to the initiative.
- Don’t insult your prospect: Patience is a virtue. Listen to the prospect and don’t try to shoehorn your product or service into every prospect’s business on the very first call. Or as my dad used to say, "Take things a step at a time: You can’t get from first base to third by running across the pitcher’s mound."
- Be prepared and speak clearly: Practice what you’re going to say and keep your message to 45 seconds or less. While I might take issue with the 45 second time frame, I would say that your first call should have an "arc" with a beginning, a middle, and an end — and the end should always be an open ended, "what’s your opinion" type question.
- Know your customer: The most common way to screw up a cold call is to not know anything about your prospect’s business. Amen. This should actually be # 1 …
- It’s a two-way conversation: According to Mr. Cheyney, "If you talk at me, you’ll annoy me. Talk with me and you have a shot." Yup.
Sales reps get hung up on cold-calling (no pun intended), but an old sales manager at Aflac had it right when he told his reps "I don’t care if your own mother refers you to a prospect: If you have never spoken to the prospect before, then your first call is always a cold call." Truer words have never been spoken.
So given the above, here’s my question: "Is cold calling an effective part of your company’s marketing mix?" Why or why not??
Photo credit: The Brooks Group
Harry, cold calling is one of those things most of us hate to do. I rarely do it, because I have had a 0% success rate with it. These days, with voicemail, it’s even harder to get to people.
What I prefer to do is target my prospects and then send a brief letter that says who I am and how and why I might be able to help make a company’s marketing communications more effective. I may use some “boilerplate” wording, but I always try to customize or peresonalize it where I can. It may take a bit longer that way, but it then becomes obvious (I hope) that it’s not a mass mailing.
I’ll the make a follow-up call, but I’ve found a lot of it is the luck of timing. If I happen to write or call during that rare window when a company is considering adding or making a change in its PR sourcing, I might get a meeting.
But I have found that for specialized services like PR, cold calling is a waste. Maybe it works if you’re selling telephone service or copiers, where everyone understands what it is and where people are always seeking better pricing or better service.
Instead of cold calls, I try to build and maintain relationships with people who might be in a position to refer business in my direction. I’d say 90% of my business has come from referrals.
Harry,
This is a fast-pass comment, as I am under some tight deadlines. However, I wanted to say that I think
David is right on target. In fact, I argue that cold calling never delivers enough ROI to recommend it. And I have more than a little research supporting that thinking.
Sales people should be out building relationships and closing deals, not cold calling. Marketing and sales working closely together lay the groundwork for appointments, relationship build and deal closing to happen.
Most people hate cold calling: They hate making them and they hate getting them.
But like I said, “I have made many thousands of ice-cold calls in my life — and if the telephone were a slot-machine, I would be waaaay up in my winnings.”
Granted, I haven’t cold called in every industry, but I have done it in enough to know that much more often than not, a well conceived and well executed multi-step, multi-media outbound telemarketing campaign will work better and faster than any of the alternatives.
Harry Joiner
AKA “The Jewel of the Dial”
You may be right, Harry. But, with all due respect, when I’ve tried it, it hasn’t simply been getting on the phone and asking the boss if he or she is looking for a p.r. agency. It’s been thought-out, from opening line to trying to anticipate various responses and being ready to respond.
I think some types of businesses do not easily lend themselves to certain types of selling that might work for others. Also, what might it cost for a “well conceived and well executed multi-step, multi-media outbound telemarketing campaign?” I suspect that for a small business like mine, the cost would be prohibitive.
I hear you. But price is what you pay and value’s what you get.
High-octane telemarketing campaigns are not expensive. But first, you have to have a great list. No amount of glib, personality, and storytelling ability is going to compensate for a lousy list. You can learn about selecting the best list for your initiative here: http://www.marketingheadhunter.com/executive_search/2006/05/niche_marketing.html
Now, once you have tightly targeted your client, what would you pay for a new customer with an LTV of $100,000? Would you pay $50? $150$ $250?
True story: Just one week ago a local Atlanta candidate FedEx’d me a toy plastic sandwich wrapped in red cellophane. Enclosed was a handwritten note that said …
“Dear Harry
I wanted to let you know that next week you’re not going to have to brown bag it. That’s right: I’d like to take you to lunch. No balogna! I’ll give you a call to see when you’re ready to hit the cafeteria.
Mark”
He followed up with a phone call, which of course I returned. We are coordinating our schedules as I write this.
Let’s say Mark spent $30 on the package and $50 on lunch. Is that too much? Hell no, it’s cheap. It’s cheap because it is so targeted and so clutter busting. It’s cheap because it works and there’s so much upside.
So when I say the campaigns must be “integrated” — this is what I’m talking about.
For some great ideas about what to mail your prospects before you call, visit http://www.mcphee.com/
Good luck!
Harry “The Jewel” Joiner
I do cold calling for a living and represent a number of clients. These clients cover specialised, complex areas (i.e. not copiers or telephone service). Two of my clients are very small companies including a one man band. I would say that cold calling works very well (ok ok, I know I WOULD say that!) but also, so do my clients. However, I think that very few people excel at cold calling, much less enjoy it, and this comes across on the telephone. My approach is very ‘gentle’, yet I am very focused on getting results. I often get feedback from the people at the receiving end of my calls along the lines of, ‘This doesn’t feel like a sales call at all. You’re very good at this, would you do it for me?’. My clients have tried other telemarketing outfits before coming to me and have had poor experiences. So it’s vital to find someone who is good at it and enjoys it.
But, in my experience, they are few and far between. I only do telemarketing three days a week as I am also training as a psychotherapist. I am turning down work regularly and know only two people local to me who I would be confident to refer enquiries to.
So, I guess what I’m waffling on about, is that cold calling done well can be extremely effective. But done poorly it can be a waste of time and money.
I think Harry and David are both correct. It depends on the industry to some degree, David, but it is a numbers game as Harry says. That’s where most people get lost. Some people can’t wrap their heads around a calling list of say 100 or more prospects a day. You have to call until you want to puke. Set up a set amount of appointments, which is usually a small percentage of the number of calls made. Use the first part of the week to make the appointments – call, call, call – and the second half of the week to make your presentation in person. It’s really hard work and it is exhausting. However, practice makes perfect and it gets easier with time. Of course there will be slumps and you’ll want to slit your wrists because you can’t get anyone to hear you but then jackpot…just like Harry said: “Indeed, I have made many thousands of ice-cold calls in my life — and if the telephone were a slot-machine, I would be waaaay up in my winnings.”
Nice post. No one wants to hear how to do it because most people don’t want to do it. Not me either.
I am on the receiving end of at least 10 cold calls a month. I never answer my phone, instead I manage it via voice mail. I only return the calls I deem important. Not once have I returned a cold call.
I find them bogus, unauthentic, un-transparent and otherwise a silly waste of energy. I applaud the persistence but it is wasted.
All that being said what I do value is the people who take the time to find out something about me and make it a point to shake my hand at a networking event. Beyond that and furthermore I like the people who make zero attempt to sell me on anything upon our first meeting or two. Nothing turns me off more than and a Hi, I do this and that and the other and I can do it better, bigger and faster than anyone. Yeah, but what is my favorite color? What are my kids names? How about their birthdays?
No offense to anyone but get real, we live in an attention economy and unless you are willing to take the time to discover, build and maintain a relationship then you are invisible to me. M
Mike,
“Will you marry me?” is not a bad question. It’s just not a very good first question. All relationships must be planned, sowed, and nurtured before their benefits can be reaped. The Law of the Farm applies universally — and kicking the tree won’t hasten ripening.
Cold calling is ONE (often highly effective) way to sow a relationship. It’s by no means the only way, but if you plan before you sow, and patiently nurture after you sow, in due time the relationship will bear fruit. At least that has been my lengthy experience — and you can bet your mortgage that if it didn’t work, I wouldn’t do it nor would I preach that gospel here.
Occasionally, I’ll come across someone like you who hates cold callers. That doesn’t make you a bad person. It just doesn’t make you a good target for this particular marketing method. However, my practice is national, and other than some major trade shows, there’s not much chance that you’ll ever see me face to face. If that’s an essential component of getting your business, then I lose. Happens all the time.
Fortunately, that leaves a substantial part of the market for guys like me to go after. It’s a numbers game, and to quote Wayne Gretzky, “100% of the shots you don’t take don’t go in.” My job is to make sure that the shots are of the highest personal, professional, and creative quality imaginable.
It’s a dirty job — but somebody’s gotta do it. Where’s Mike Rowe when you need him?
-Harry
It’s good to get a well-thought out pro-cold-calling perspective when most people seem to recommend alternative approaches these days. One of the questions I always have, though, is how to handle the initial calls. Some say marketing should do it. Harry and Sean say that the salesperson should do it. If the salesperson does their own calling, does that suggest that they are part of a smaller operation? one where there isn’t a dedicated lead-development/marketing department? And if they were part of a larger organzation, would they still do their own calling?
Harry, I’m afraid you ended your article simply asking the same question in your headline that presumably you were going to answer.
Inadvertently, you may have done so by noting: “Our society is famously over-communicated, and B2B prospects are very good at tuning out marketing messages.” We agree.
At Prism Ltd. we are skeptical of cold calling. It is an enormous expenditure of time that produces a poor ROI. So until we see some reasonable evidence to the contrary we will continue to advice our clients to give cold calling a limited role. Even then we suggest giving it to juniors, as a learning experience in building B2B relationships. We think that secondary benefit may be cold calling’s primary value. Alexander S. Prisant, COO, Prism Ltd
Hi Alexander,
I ended my article by asking the same question in my headline because I wanted to run a poll with the article. A question in the headline typically boosts response, and a poll at the end typically promotes debate — which this one certainly did.
I agree with author Dan Kennedy, who claims that ALL marketing … in any market … now and throughout history has relied on the three stools of Market, Message, and Media to be successful.
Here are some ways to screw it up:
1. Right Message — Wrong Market — Right Media
2. Right Message — Right Market — Wrong Media
3. Right Message — Wrong Market — Wrong Media
4. Wrong Message — Right Market — Right Media
5. Wrong Message — Wrong Market — Right Media
6. Etc …
There’s only one way to get it right: “Right Message — Right Market — Right Media”
There are times when cold calling is the right media, and times when it is the wrong media. Moreover, there are times when cold calling is a highly effective part of an integrated marketing mix.
At ReliableGrowth.com it was my job to know when, how, and in what proportion to complementary media a cold-calling initiative would work.
Harry
Harry, since my last comments here a few days ago, I had lunch today with a friend who used to do new business prospecting for a mid-size NY ad agency.
She tells me that, from her personal experience, cold calling can work, although it does take a lot of time. She said before she made a single call, she would thoroughly research a prospect and try to find some touchpoint she could use to engage the person in a bit of discussion. In reality, she tells me, each call could take more than double or triple the time of the actual call, when you add in the prep time.
I’m still cool,if not cold, on cold calls. But it would be interesting to hear from other small biz owners, especially those in consulting businesses.
Interesting conversation here. I think cold calling still works, but like anything creative, it works well for some and poorly for others, depending on skill. And it needs to be part of a sales and marketing strategy.
We can’t all be “slightly famous” or niche experts for whom the phones ring incessantly, because of our nationwide public speaking or online marketing.
Calling to cram something down someone’s throat doesn’t work. Neither do poor over-the-phone relational skills in general. Maintaining a brief but conversational tone and thinking on your feet are must-haves.
Having said that, I also think it’s “decreasingly effective,” in proportion to our increasing cynicism (at least in the U.S.), but that’s a topic for another day.
“We can’t all be ’slightly famous’ for whom the phones ring incessantly, because of our nationwide public speaking or online marketing.”
For the record, 99.99% of the executives I cold-call have never heard of me. And although I don’t normally engage in public speaking — I will admit that getting “Googled” is often what happens immediately after I cold-call a prospect. In that sense, cold-calling 50 people a day hasn’t been bad for my readership.
In fact, I have grown quite fond of thinking of a voice mail as a highly personalized “radio commercial” for my business and my blog — for the two identities are inseparable: MarketingHeadhunter.com
Actually, I leverage the fact that 99.99% of my callees don’t know me: In order to boost response of my “micro-radio spots” sometimes I will say that I am Harry Joiner with “EcommerceRecruiter.com” — a domain which redirects to MarketingHeadhunter.com.
Indeed, I have ~250 keyword rich domains (such as DatabaseMarketingRecruiter.com) that redirect to my blog for the sole purpose of tightening my message-to-market match.
If my callees knew me, they’d know that I’m online at MarketingHeadhunter.com and would be less likely to return my call.
I just can’t believe I wrote “not me either” uh… me neither.
Harry,
Lots of good comments here. Cold calling is not the answer to generating new business – regardless of what your service or product is – but it is an answer. It’s part of the total marketing strategy. First, try to determine who the decision maker is before you call (homework). Then call and ask for that person by name. Do not leave a voice mail message – what’s the point since you’ve never met and the chances of a callback are nil. Realize that it’s results that count and not the effort. if you make 10 calls during a day and actually speak to no one – only receptionists, assistants, or recordings – you’ve gotten no closer to your goal. Also, the cold call is designed to open the door to the relationship, create interest, and pave the way to a future appointment or conversation. A cold call is not designed to make a sale. It might occasionally, but that’s not its purpose.
Steve
“Do not leave a voice mail message – what’s the point since you’ve never met and the chances of a callback are nil.”
Actually, my experience is that voice mails are a perfect way to ultimately DISQUALIFY a prospect, but the prospect must be called at least three times, 48-72 hours apart before discarding the lead.
Clearly, you never want to harass or stalk — but in some businesses (like Aflac supplemental insurance) — the caller must count on the following pattern:
First call deleted without hearing (95%)
Second call deleted with partial hearing (90%)
Third call deleted with complete hearing (85%)
In the end, ~85% of the calls that are deleted are deleted with the prospect having heard and understood the nature of the call. The remaining 15% of the calls are either returned or routed to the proper decision maker. The rest of the leads can be programmed for a re-call in 90 days.
Point is, most people, even if they need your product or service, will delete your first two voice mails simply because they are too busy and you are unfamiliar to them. It has absolutely nothing to do with the gravity of their need. Their deletion of your voice mail is nothing more than a bad habit.
Again, I speak from experience: I have studied this stuff (Peppers & Rogers, Neil Rackham, Jim Cecil, Miller-Heiman, Geoffrey Moore, Seth Godin, Brian Carroll, et al), developed training programs around it, done it thousands of times, and successfully marketed my own integrated marketing programs to small business owners.
I agree with everyone here who note that cold calling doesn’t work in every situation. However, in most cases where the marketing manager has written it off as useless, the programs failed through poor program design and execution.
It’s odd that the debate seems to be “does cold calling work” when clearly it does. Seems like the question should be “is it worth it for you”.
We do a huge volume of marketing for a lot of large companies and we find many media for messages cycle in their effectiveness. Right now, for example, direct mail is working extremely well (probably because so many companies have abandoned it) and email is on the wane.
For any campaign to work every aspect has to be done as well as possible. Nothing stands alone. When people say “___ doesn’t work for us” I immediately know why. You weren’t doing it well.
It doesn’t matter how superb your creative is, if you deliver it to the wrong person nothing good will happen. Likewise, the best list is useless in the hands of a lousy cold caller.
Nuances matter. Voice and tone matters. And the environment matters. I can’t believe anyone buys stock from a guy with a New York accent–they immediately sound like the boiler room guys on The Sopranos.
Hi and thanks for the link crediting the picture to The Brooks Group.
Those of us here at The Brooks Group just wanted to weigh in on this comment from David Reich.
“It would be interesting to hear from other small biz owners, especially those in consulting businesses.”
We are a fairly small sales consulting firm (about 20 employees). Our founder and CEO Bill Brooks, often says “there is nothing dumber than cold calling.” Obviously, he’s taken some heat from some people for saying that, but his response has often been: “Do you know how much business that has brought to this company over the years?” In other words, many of the companies that we’ve consulted with were desperately in need of a smarter way to reach prospective customers and our organization has helped them identify targeted strategies that fit their business models.
Strategy is the key here. If cold-calling fits in terms of whom you’re trying to reach, how you want to be positioned etc., then it may indeed be a good method of prospecting, but rarely does it make for a good selling strategy — Especially if you want to enter into a long-term, consultative partnership with your clients. To do that, you’ll need to do quite a bit of research so that you can enter the account at the highest possible level, (a level that can be very hard to reach strictly via cold-calling). And you’ll need to approach in a manor that positions you as a valuable expert (which is counter to the negative perception many people have about cold-calls.)
The bottom line is: Do what works. BUT, don’t become so focused on short-term results that you mis-position yourself. Without strategic
positioning you may never get a solid foothold; in your individual accounts and in your marketplace – which puts you right back to square one – pounding on the phones for new blood.
Here is an article that illustrates the point better… http://www.brooksgroup.com/articles/senior_level_decision_maker_selling.htm
This is a well thought out article and you have several well thought out and considered answers…
As someone who works with many different companies I have seen many examples of cold calling having phenomenal results. I have also seen it fail spectacularly!
There seems to be a current trend to label all cold calling as pointless. This is a popular myth and one that I believe people are keen to buy into as they never liked cold calling in the first place.
I have read some of these solutions which say that cold calling doesn’t work and I can say that not only would they be ineffective in many markets but also that many of the techniques would not be allowed to be used by individual salespeople within a company in any case.
Cold calling can be very effective however certain conditions need to be in place. Here are 5 conditions for cold calling to make more sales or appointments…
1) The cold caller needs to be knowledgeable in their products, the market place and the benefits that their solution can provide for the client.
2) The cold caller needs to be positive about cold calling. No-one likes cold calls from someone who doesn’t want to be there!
3) The cold call needs to be targeted and specific to that individual. This requires a system wihch effectively warms up the cold call. This would mean a cold call becoming a tepid call, a tepid call becoming a warm call, a warm call becoming a hot call and a hot call becoming a sizzling call.
4) The cold caller needs to be well trained and coached so that they project a credible business persona and can deliver valuable business benefits for clients.
5) The call needs to be respectful and allow the client to “choose” whether the cold call adds value or not.
Finally, no business should be a one-trick pony. If cold calling is your only method of winning business your business is flawed. Every business should utilise and leverage different ways of prospecting for new clients. As a salesperson your job is to leverage the most effective of these for growing your business.
In summary, well thought out and targeted cold calling strategies which are implemented by well trained and credible sales professionals can be a powerful and important addition to your client acquistion strategies. In many industries it can be one of the most effective and efficient way of wining new prospects other than referrals.
How do you stop people from throwing the barriers up, not allowing you to seek just the important information “IE, when do you need a new one” or “What would you like out of your machine” without them replying “We don’t need a new one, oh and it’s a space age device with everything!
Telemarketing is the most proven form of lead generation. Most telemarketing companies offer the following services outbound telemarketing appointment setting, lead generation, surveys, market research, list cleaning, database update, seminar registration, fund raising, phone sales, and client reactivation… just to name a few!
Our main focus is performance based b2b lead generation and appointment setting. We can do much of the above but we choose to zero in on our strong point which is setting face to face meeting with key level decision makers.
Do you want more sales opportunities?
Contact
Matt Davis
877-733-4867
Or go to http://www.telehammers.com to get your new telemarketing campaign in motion!
Telemarketing is the most proven form of lead generation. Most telemarketing companies offer the following services outbound telemarketing appointment setting, lead generation, surveys, market research, list cleaning, database update, seminar registration, fund raising, phone sales, and client reactivation… just to name a few!
Our main focus is performance based b2b lead generation and appointment setting. We can do much of the above but we choose to zero in on our strong point which is setting face to face meeting with key level decision makers.
Do you want more sales opportunities?
Contact
Matt Davis
877-733-4867
Or go to http://www.telehammers.com to get your new telemarketing campaign in motion!