SCORE of Rockford Illinois / Article: Pros, cons to employing telemarketers / Small Business Administration

Pros, cons to employing telemarketers

Question:
I notice that a number of companies are using telemarketing help to obtain business. Does it really pay for itself in new business or do the additional profits just cover the additional costs?

Answer:
A growing number of businesses are finding that telemarketing can help their firms increase sales, reactivate old accounts and supplement the efforts of the sales group.

Would telemarketing have an value for your firm? This depends on the goods and services you sell and how well your business could integrate telemarketing into its operations.

However, there are benefits from using this approach. Here are the most commonly cited:

Research shows that many sales prospects are more receptive to phone calls than to personal contact because they feel less pressure to buy.
First impressions can be very important when selling. The minute the customer meets the salesperson, the individual begins making a judgment as to whether the salesperson is honest, knowledgeable and helpful.
The telephone can help reduce many of the prospect's biases, since prejudgments can be based only on the caller's voice.
You can call on a lot more customers with telemarketing than with a field sales force. A conscientious field salesperson may obtain one high-quality prospect out of four contact, while a telemarketer may reach only one high-quality prospect in eight calls. A telephone salesperson can make 30 to 40 calls in an hour, resulting in a lot more presentations.
Telemarketing provides virtually unlimited geographic coverage. All the prospect needs is a telephone to become a potential customer.
Telemarketing provides rapid feedback. The seller knows very quickly whether the prospect wants to buy.
It's possible to maintain better control of the telemarketing sales force than salespeople in the field. As a result, efficiency is often higher among telemarketers groups.
It is usually a lot less expensive to hire a telemarketer than a field salesperson. Compensation is often about 50 percent as much for telemarketers.
A telemarketer can often perform such diverse duties as handling marginal accounts, canvassing and order-taking more quickly than an outside salesperson by generating more customers call per hour. The result is saving in expense and time.
There is less problem with the competition luring salespeople away. When a person is n the field, he or she comes in contact with competitors and eventually learns which salespeople are good and which are not.

Of course, there are some shortcomings to telemarketing. For example, poor telephone techniques can defeat the telemarketing strategy. These include rudeness, overaggressiveness, dishonesty and an impersonal attitude.

For telemarketing to work well, there has to be good coordination between those taking orders and those filling the orders.

Finally, it's important to remember that the work can be monotonous, resulting in high employee turnover. So you need to weigh the benefits as well as the potential problems before deciding whether telemarketing is for you.

Bill Bryan is a counselor with the Service Corps of Retired Executives. SCORE offers counseling, workshops and seminars on small business operations. You can reach Bryan through SCORE, 515 N Court St. 815-962-0122, for information and appointments.

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