The CustomerServ Blog

Your Feet On The Street: BPO and Call Center Industry Insights

Is Outbound Telesales Making a Comeback?

The death knell for outbound telesales has sounded countless times over the years. Aggressive cold-calling practices, fraudsters, scam artists, relentless robocalls… it’s easy to see why telemarketing’s much-maligned reputation has been dominated by images of the illicit “boiler room” operation.

A brief history of outbound telesales

Although telemarketing is undergoing a revival, it has had its ups and downs since the beginning. The big surge in telemarketing operations happened in the early 1980s to mid-1990s when the industry grew from employing a half-million agents to 4.5 million, according to the Ad Age Encyclopedia of Advertising. Likewise, the number of telemarketing operations in the U.S., both in-house and outsourced, rose from fewer than 80,000 to 565,000. As many businesses discovered, telemarketing proved to be an efficient model for driving sales.

Unfortunately, success often invites the opportunity for abuse. Unethical telemarketers employed unscrupulous tactics, consumers began to feel harassed by the plethora of nuisance calls and, by the late 1990s, it looked like the end was near for outbound. Annual fraud costs exploded, prompting the Federal Trade Commission (FTC), Federal Communications Commission (FCC) and watchdog organizations to strengthen regulations to protect consumers.

In 2003, the FTC established the National Do Not Call (DNC) Registry to give consumers a choice about whether they wanted to receive unsolicited sales calls from telemarketers. Similarly, the Telephone Consumer Protection Act (TCPA), passed by Congress in 1991 to restrict the use of automated dialing and prerecorded voice messages, was since amended to require written consent from consumers before robocalling them.

But let’s face it: Scam artists and serial fraudsters exist in virtually every business and have exploited all forms of communication—phone, email, websites, traditional mail and social media. For telemarketers, illegal robocallers and phone scams, in particular, have cast a dark cloud over an otherwise legitimate industry that employs millions of people.

In recent years, telemarketing providers have banded together to project a new image based on customer engagement and compliance. Reputable outbound telesales operations are enjoying a resurgence as companies discover that telesales can be a highly effective customer acquisition and retention tool when part of a well-designed marketing strategy.

Welcome to the age of customer engagement

The rise in digital channels over the past decade has had a profound effect on service and sales operations. Corporate enterprises have been successful at deflecting inbound calls to self-service channels to save costs, but in doing so, they also have been losing out on opportunities to up-sell and cross-sell customers. As call volumes decrease year over year for many companies and customers look to alternative channels, there is a renewed interest in proactive sales channels like outbound telesales.

Outbound selling, if done right, can help to bridge the sales gap and open up cost-effective ways to acquire and retain customers. Corporate enterprises and outsourcing providers are working in concert to design needs-based sales and marketing programs that perfectly match products and services to a customer’s lifestyle, wants and needs.

Telesales agents trained in conversational sales techniques provide a meaningful emotional connection that not only increases conversion rates and customer satisfaction, but customer loyalty as well.  According to Bob Davis, founder of Robert C. Davis and Associates, a renowned customer contact consultant:

“The first 30 seconds of an outbound sale call is critical. It needs a statement that demonstrates that the call will be of value to the customer, and even more importantly during the first 30 seconds, there needs to be a question that engages the customer at an emotional level and starts the quality conversation. Throughout the call, the Telesales Agent needs to demonstrate a genuine and sincere interest in the customer.”

I could not agree more with Bob. The “early hang-up,” while unavoidable, can be mitigated by that emotional, upfront connection between agent and customer.

Advantages of the EBR – existing business relationship

For their part, companies are getting smarter about encouraging customers to opt-in to learn more about products and services, thereby creating an existing business relationship (EBR). And, of course, once a customer is acquired, a well-planned and carefully curated outbound contact strategy can be very effective in upgrading customers, cross-promoting other products and services and building brand loyalty and share of wallet over time.

An EBR not only provides the agent with necessary information about the customer’s interests but, by opting in or signing up for “basic” and “starter” products and services, there is a reasonable expectation on the customer’s part that they will be contacted, so the call is not seemingly “out of the blue.” Unlike the heavy-handed sales tactics of the past, elite outbound vendors today employ modern telemarketing programs that leverage predictive analytics and buyer intent data to identify the right offer at the right time, which is delivered by well-trained telesales agents who provide a white-glove experience.

Outbound telemarketing is not for everyone

Despite clear opportunities to generate sales, running an outbound telemarketing call center is not for everyone. The expense and resources needed to create an outbound infrastructure are often underestimated given the skill sets required along with performance measures, recruiting and hiring models, and training programs—to name a few.

Outbound selling requires certain “mettle” in the face of rejection. Let’s face it; the outbound agent will encounter many more “no’s” than “yes’s.” Agent burnout is high due to the aforementioned “rejection factor” inherent in outbound selling. The agent turnover rate for outbound programs can often be two to three times higher than for inbound or other call center functions. To offset the difficult nature of the job—and the expense of constantly having to backfill and replace staff—call center vendors that offer outbound programs typically must pay higher compensation and offer other perks to help attract and retain top talent.

Regulatory compliance is another challenge. Keeping current with changing legislation along with monitoring and training staff to adhere, without fail, to all compliance rules, demands dedicated resources and a hefty budget. And no matter how flawless your operation, watchdog groups, federal agencies and the media will be watching closely for any missteps.

The commitment to maintain strict compliance standards and strain on resources from the constant hiring and training cycle are demanding factors that can permeate the entire organization—even senior leaders can burn out from the effort.

A few good - correction, “great”- outbound sales vendors remain

These days, there are fewer bona fide outbound telesales vendors in our industry since not every call center BPO outsourcer wants to take on such taxing requirements. Best-in-class outbound telesales companies are a dying breed—yet the demand for high-quality outbound is growing, especially in certain vertical markets such as telecommunications, cable, membership services, fundraising, insurance, subscriptions, lead generation, continuity products, after-market sales and other industries.

I want to be clear that the existence of an outbound sales operation doesn’t guarantee that it is an “elite” one. There are many outbound operations that we have vetted which do not hold a candle to the superior operations we strongly prefer. And it is these leading sales organizations that are often able to meet a client’s quality, performance, analytics and scalability requirements simultaneously.

One of the biggest challenges for corporations that outsource outbound telesales today is finding superior vendors that can deliver on key metrics. These essential outbound measurements include:

  • Quality scores
  • Completion rates
  • List penetration rates
  • Conversion of contacts
  • List yield
  • Adherence to monthly and often contracted “hours” commitments
These and other metrics like monthly recurring revenue, cost-to-acquire and average order value are closely tied to the client’s sales and market penetration, outsourced telesales budget and return on investment. 

Consistent delivery on these metrics with a scalable outbound operation while maintaining pristine quality control standards is no easy task. That is why only the strong survive in this space, and there is a very clear delineation between mediocre and “rock star” outbound telesales firms. Therefore, superior outbound telesales is a differentiating value proposition that helps certain call center BPO firms stand out from the crowd and win coveted telesales contracts from discerning client-side outsourcing buyers.

What else makes an outbound telesales vendor best-in-class?

Vendors that we consider “outbound specialists” are selective about the types of outbound telesales clients with whom they will work. For these providers, outbound selling is part of their core DNA. In contrast, call center vendors that provide outbound telesales “just” as an ancillary service are not the ones you want for best-in-class expertise. If outbound is not a core competency of your vendor, look elsewhere.

We have found that, among the elite outbound telesales vendors, their outbound clients account for at least 40% or more of their overall revenue. We also know that their outbound clients include Fortune 50-100 corporations; therefore, quality standards are airtight and well-refined processes are already in place for compliance, workforce planning, sales skill training, list management, dialing systems, performance management and quality calibration.

Leading outbound telesales vendors have mastered “people” development by utilizing inventive recruiting, training and motivational practices that get results. Combine this with competitive compensation and incentives tied into quality scores and performance, and you have a winning formula. Some of our vendors use personality testing, as well, to ensure that outbound sales agents have the right temperament and traits to succeed in the role. Add to that frontline managers with on-the-phones experience who coach, counsel and mentor agents for the high-stress, often unforgiving world of outbound.

Finally, these vendors are hypersensitive about compliance within their operations and the industry. Leaders typically serve on compliance committees, advocate for best practices and are always a step ahead of impending compliance regulations.

Make outbound telesales part of a holistic marketing strategy

In this era of digital communication, automation and self-service, the human connection makes outbound telesales one of the most effective techniques for engaging customers and generating revenue. It is often the most cost-effective approach for customer acquisition, upgrades, cross-sells, reactivation, shopping-cart abandons and winning back canceled or dormant customers.

A successful outbound telemarketing strategy calls for intelligent database management, effective marketing strategies, strict adherence to compliance standards, and well-trained outbound sales agents. The most powerful programs start with a service-oriented mission and telesales agents who believe in the value of what they’re selling and are driven by the desire to enhance their customers’ lives.

Don't miss a beat. Sign up for the CustomerServ blog.

 As a call center outsourcing thought leader and president of CustomerServ, Nick Jiwa is dedicated to helping companies find, select and retain the right call center outsourcing partners. Nick’s expertise and contribution to the call center industry started in 1986 – as a call center agent when the industry was still in its infancy. An avid 80s music buff, proud father and soccer fanatic, Nick is passionate about “anything call center”, giving back to the community, mentoring and helping others win!



Recent Posts

Subscribe to Blog

Call Center Blogs