Offshore Telemarketing Better Results at Lower Costs?
By James Thornton
Until four years ago, I held the same prejudice against telemarketing that I now hold against unsolicited e-mail: I felt it was a crass invasion of my privacy.
My views have changed since I've had a good experience through an interest I hold in a global subscription marketing operation that sells subscriptions out of the Philippines.
We hired a small group of telemarketers on a test basis to follow up leads from an acquisition program and to call expired subscribers. The acquisition campaign results were marginal, while the retention campaign worked well.
It worked so well the company's overall renewal rate increased from an annual average of 51 percent to an average of 82 percent. Furthermore, the average order value through upgrading and cross-selling on the telephone now averages US$360 compared to an average order value of US$220 through the mail.
Prior to the test, three renewal notices were mailed before passing renewal records to the telemarketers for follow up. Now, telemarketers call subscribers six weeks before the renewal is due because it results in a higher-value subscriber base. The staff closes seven of every 10 completed calls.
A key strategy is to allow the same telemarketer to speak to the same subscribers each time they are called, which builds customer relationships. To the subscribers, their telemarketer is the voice of the company: He or she answers any questions and deals with any complaints on the subscribers' behalf. Telemarketing facilitates a customer relationship in a way that a postal relationship cannot.
As cross-border telecom rates have dropped considerably, it's now both easy and inexpensive to call within Asia, to Australia, the Middle East, Europe, Africa, Latin America and the Caribbean.
Many international periodical publishers are either renewing expired subscribers on the telephone in-house, through a call-center, or planning to do so in the near future. Why? Telemarketing works, and it's extremely cost-effective to call from a developing country. The conversion from a new subscriber to the first renewal is where the greatest subscriber fall-off occurs for publishers, and this is where telemarketing can make the difference.
If you outsource a call center in the Philippines, the charge-out rate will be around US$15 per agent per hour. In India the cost is slightly less. Ireland often is used as a base for calling into Europe, but costs there can be twice as high as India or the Philippines.
Whether you decide to set up an in-house department or outsource, consider adding outbound telemarketing to your CRM efforts. Telemarketing cannot substitute for a good product or compensate for the postal and e-mail components of a good CRM program, but it's an extra tool that can give your direct marketing business a really solid foundation. And when used for retention and enhancing long-term relationships, telemarketing is entirely acceptable—and it works.
James Thornton is the founder of Mailing Lists Asia Ltd., a global list brokerage service; International Mailings Ltd., which has equity in eight international direct marketing companies; and Asian Response Ltd., which negotiates rates with international print media. Thornton can be reached by e-mail at email@example.com.