Information about Telemarketing

Telemarketing is a method of direct marketing in which a salesperson uses the telephone to solicit prospective customers to buy products or services. Telemarketing can also include recorded sales pitches programmed to be played over the phone via automatic dialing.

History

The term telemarketing was first used extensively in the late 1970s to describe Bell System communications which related to new uses for the outbound WATS and inbound Toll-free services.

Categories

The two major categories of telemarketing are Business-to-business and Business-to-consumer.

Subcategories

• Lead Generation, the gathering of information
• Sales, using persuasion to sell a product or service
• Outbound, proactive marketing in which prospective and preexisting customers are contacted directly
• Inbound, reactive reception of incoming orders and requests for information. Demand is generally created by advertising, publicity, or the efforts of outside salespeople.

Procedure

Telemarketing may be done from a company office, from a call centre, or from home. It may involve either a live operator or a recorded message, in which case it is known as "automated telemarketing" using voice broadcasting. "Robocalling" is a form of voice broadcasting which is most frequently associated with political messages.

An effective telemarketing process often involves two or more calls. The first call (or series of calls) determines the customer’s needs. The final call (or series of calls) motivates the customer to make a purchase.

Prospective customers are identified by various means, including past purchase history, previous requests for information, credit limit, competition entry forms, and application forms. Names may also be purchased from another company's consumer database or obtained from a telephone directory or another public list. The qualification process is intended to determine which customers are most likely to purchase the product or service.

Charitable organizations, alumni associations, and political parties often use telemarketing to solicit donations. Marketing research companies use telemarketing techniques to survey the prospective or past customers of a client’s business in order to assess market acceptance of or satisfaction with a particular product, service, brand, or company. Public opinion polls are conducted in a similar manner.

Telemarketing techniques are also applied to other forms of electronic marketing using e-mail or fax messages, in which case they are frequently considered spam.

Negative perceptions and criticism

Telemarketing has been negatively associated with various scams and frauds, such as pyramid schemes, and with deceptively overpriced products and services. Some telemarketing companies raise donations for illegitimate police and law enforcement agencies, often with sound-alike names to legitimate organizations while most or all of the donations are not used for charity. The companies buy and share lists of elderly citizens to call and hire only male telemarketers, allowing the senior citizen to believe he or she is talking to a real policeman, and then having a young female "verifyer" verify that the donation amount, usually $20 to $50, is sent to the company immediately. The companies rent post office boxes in the name of the "charity" the targeted senior citizen thinks they are donating to. All the "charities" have the same P.O. box listed on the envelope for the fraud victim to send his or her check to. Fraudulent telemarketing companies are frequently referred to as "telemarketing boiler rooms" or simply "boiler rooms." Telemarketing may also be criticized as an unethical business practice due to the perception of high-pressure sales techniques during unsolicited calls.

Telemarketing calls are often considered an annoyance, especially when they occur during the dinner hour, early in the morning, or late in the evening.

Regulations

Telemarketing is subject to regulatory and legislative controls related to consumer privacy and protection.

Telemarketing in the U.S. is restricted at the federal level by the TCPA Telephone Consumer Protection Act of 1991 (47 USC Section 227) and the FTC's Telemarketing Sales Rule. The FCC derives regulatory authority from the TCPA, adopted as CFR 64.1200. The Many professional associations of telemarketers have codes of ethics and standards that member businesses follow to encourage public confidence.

Some jurisdictions have implemented "Do Not Call" lists through industry organizations or legislation; telemarketers are restricted from initiating contact with participating consumers. Legislative versions often provide for heavy penalties on companies which call individuals on these listings. The U.S. Federal Trade Commission has implemented a National Do Not Call Registry in an attempt to reduce intrusive telemarketing nationwide. Telemarketing corporations and trade groups challenged this as a violation of commercial speech rights.^[1] However, the U.S. 10th Circuit Court of Appeals upheld the National Do Not Call Registry on February 17, 2004.^[2]

Companies that use telemarketing as a sales tool are governed by the United States Federal regulations outlined in the TSR (amended on January 29, 2003 originally issued in 1995) and the TCPA. In addition to these Federal regulations, telemarketers calling nationally must also adhere to separate State Regulations. Most states have adapted DNC files of their own, of which only some states share with the US Federal Do Not Call registry. Each US state also has its own regulations concerning: permission to record, permission to continue, no rebuttaling statutes, Sunday and Holiday calls; as well as the fines and punishments exacted for violations.

Telemarketing techniques are increasingly used in political campaigns. Because of free-speech issues, the laws governing political phone calls are much less stringent than those applying to commercial messages. Even so, a number of states have barred or restricted political robocalls.

Telemarketing in Australia is restricted by the Australian Federal Government and policed by the Australian Communications and Media Authority (ACMA). Australian Federal legislation provides for a restriction in calling hours for both Research and Marketing calls.^[3]

In 2007 a do not call register was established for Australian inbound Telephone numbers, this register allows a user to register private use telephone numbers. Australian Federal Legislation limits the types Marketing Calls that can be made to these registered Telephone Numbers, however research calls are allowed. Other exemptions include calls made by charities and political members, parties and candidates^[4]

Inbound telemarketing is another major industry. It involves both live operators and IVR--Interactive Voice Response. IVR is also known as audiotext or automated call processing. Usually, major television campaigns and advertisers use 800 numbers that are answered by IVR service bureaus. Such service bureaus have the technology and call capacity to process the large amounts of simultaneous calls that occur when an 800 number is advertised on television.

In Popular Culture

On an episode of the sitcom Seinfeld, Jerry gets a telemarketing call at home and says "I can't talk now, but why don't you give me your home number and I'll call you tonight." When the telemarketer hesitates, he continues "Oh, do you not like getting calls at your home from strangers?" "No," replies the telemarketer. Jerry says, "Well, now you know how I feel," before hanging up. In a subsequent episode, Jerry gets a call from the New York Times, offering him a subscription. He enthusiastically responds that he is interested, then hangs up.

In 2003, humor columnist Dave Barry urged readers to exercise their constitutional right to telephone the American Teleservices Association, a trade group that represents telemarketers. This prank was inspired by language telemarketers' lobbyists were using when urging the FTC to block or limit a US do-not-call registry. Thousands of readers phoned the ATA--when its leaders complained about the disruption, Barry responded with mock contrition, "I just hope nobody interrupted the A.T.A.'s dinner." [1]

Technology

• Autodialer
• Automatic call distributor
• Customer relationship management
• Predictive dialer
• Private Branch eXchange

Sound

References

See also

• Boiler room (business)
• Call Centre
• Cold calling
• Direct marketing
• Marketing
• Reloading scam
• Spamming
• Sucker list

External links

• American Teleservices Association
• Congressional Research Service (CRS) Reports regarding Telemarketing
• Federal Trade Commission Information about Telemarketing Rules and Scams
• Federal Trade Commission Do Not Call Registry
• How to Sue Telemarketers in Small Claims Court - A guide from non-profit consumer advocates
• Laws Regulating Telemarketers
• List of State Do Not Call Lists
• Telephone Preference Service – UK Do Not Call Registry