We’ve all been there. The landline rings unexpectedly or an Unknown Number flashes on your screen and — before you know it — you’re listening to somebody’s sales pitch for a product you don’t need.
Insurance claims, home insulation, car accidents that never happened — the thought of receiving these cold calls could send shivers down anyone’s spine. In fact, only 2% are said to be successful.
Immediately, your finger hovers over the “end call” button. While this isn’t a position many people want to find themselves in, our distaste for so-called “cold calls” is predominately down to the way they’re conducted.
So, is cold calling a dated sales tactic? Or that it needs some added heat?
A Chilly Reception
But what exactly is cold calling? In most cases, the term describes an attempt to solicit business from a potential customer, typically via a phone call, who may or may not know about the company that’s calling.
Cold calling’s effectiveness is often debated. According to marketer Charlie Cook, 98% of cold calls do not result in a successful sale. However, Sales Insights Lab reports that 41.2% of sales professionals consider their telephone as one of the most important sales tools at their disposal.
There are other factors affecting cold calling’s validity. Over the past two years, as much of the country has worked from home, many have reported a rise in the number of unwanted calls they receive.
And, unfortunately, many calls are ingenuine. As many as 59.49 million Americans (23%) report having lost money as a result of phone scams in the past 12 months — up from 56 million in 2020.
While this category of nuisance calls — often including those false insurance claims — is not the same as a genuine telesales tactic. The two are often lumbered into the same boat, damaging the reputation of authentic sales teams.
The United States has legislation in place to prevent the public from being harassed by cold callers. Cold callers may only call their targets at home between 8:00am and 9:00pm. However, these time restrictions do not apply if the recipient is already a customer of the firm or if they’ve given the firm permission to call at other times. Cold callers may call at work at any time.
Cold callers must also say who’s calling and why. They must promptly state their names, their firms’ names, addresses or telephone numbers, and that the purpose of the call is to sell a product or service.
Saying No is also an option. The U.S. Federal Communications Commission (FCC), Federal Trade Commission (FTC), and the Securities and Exchange Commission state that cold callers must put their targets on the National Do Not Call Registry if asked, preventing the caller from contacting that individual again.
Canada follows a similar process, with a National Do Not Call List that is designed to reduce the number of unwanted telemarketing calls and faxes Canadian consumers receive. If a consumer asks not to be contacted, the telemarketer must add their name and number to their own internal do not call list within 14 days.
While many would hope for this result, cold callers must tell the truth. People selling products, (including insurance policies and securities) and services, must outline the exact details of what they are selling. If sellers and brokers lie about any important aspect of what they are offering they violate the many laws governing these practices.
Turn up the Heat
With all this in mind, it’s easy to see why cold calling receives a bad reputation, and why some businesses may consider scrapping the sales technique altogether. However, it’s fairer to say that cold calling as it is most commonly thought of is dead — but calling isn’t.
Before picking up the phone, call centers need to make sure they have the right prospect lists. Having access to the right data, in this case the correct people to contact, is vital.
It sounds simple, but most bad customer experiences stem from being offered something that’s irrelevant. Calling the wrong people can actively damage a business, so the quality of your prospect list is crucial.
And having the wrong data won’t only spoil relationships. IBM has estimated that bad data costs the U.S. economy around $3.1 trillion dollars each year. Additional research from Experian also found that bad data has a direct impact on the bottom line of 88% of American companies, with the average company losing around 12% of its total revenue.
Businesses wanting to enhance their prospect lists have several possibilities. First, it’s helpful to do something that may seem counterintuitive — begin with existing customers.
Depending on a business’s line of work, particularly if it’s project-driven, it might see each contract it secures as a one-off or occasional activity.
But in fact, using a warm lead provides the opportunity to contact businesses that are relevant and more likely to enlist in your services again.
Similarly, revisiting past customers can also improve call success rates. It’s easy to let good contacts slide over time, and whether your address book is a fully-fledged CRM system or something more ad hoc, never forget that your old contacts are gold.
In addition to building a good prospect list, optimizing call center data also means understanding the information received via the call center metrics dashboard.
Core metrics to master include abandonment time, the percentage of callers that get frustrated with waiting for answers and hang up, and average and maximum wait times for inbound calls to be answered.
Call center managers should also analyze data for the average communication time for inbound and outbound calls, in order to track how long it takes operators to get the outcomes they seek.
When looking at call resolution rates, or calls that can be deemed a success, anything over 90% is considered optimal. If a business is dipping below 70%, it needs to improve, and below 40% requires immediate action.
Ditch Direct Dialing
Once a call center has its list of prospects in place, it’s time to do something controversial: ditch the traditional direct dial telephone calling.
That’s because this old method of cold calling is dead, and companies need to streamline the way they make calls and manage their outcomes.
The arrival of the cloud-based call center means that today’s business leaders can unlock a scalable, flexible environment for customer experience and support.
At the same time, by conducting calls hosted from the cloud, companies have more freedom to manage and control all activities in a central environment.
But what does taking call center activity to the cloud really mean? A cloud-based call center software allows sales teams to make calls more efficiently than with a simple business phone solution. Because voice-based communication services are hosted off-premise, opting for a cloud software delivers multiple benefits to call centers.
First, using cloud software allows call center managers to store infinite data on customer interactions in a safe and compliant manner, so it’s easy to access in-depth insights into call patterns and outcomes. It’s also possible to combine the software with CRM systems for a better overview of the customer journey.
Secondly, taking call center software to the cloud helps make businesses more scalable. Unlike the added complexities of using fixed lines, call center managers can easily add or reduce access to the software when necessary. Like during periods where customer support or sales opportunities, and staffing needs, are greater, such as Christmastime.
And, fundamentally, using cloud-based software improves the customer experience. In addition to understanding consumer behaviors with better data analytics, cloud software can help call center operators feel closer to their customers.
When calling a prospect for the first time, using a number close to theirs always achieves better results. Using cloud call system means that call centers can make use of international numbers, wherever their operators are located.
While most customers don’t welcome an unwarranted sales pitch from a shady phone number, cold calling isn’t dead. The traditional method of telemarketing is no longer — now businesses can use enhanced data analytics and optimized call center software to bring some much-needed heat to their cold calling tactics.