We all know the pressures these days to add revenue, become a profit center versus a cost center in the world of call and contact centers.

While there is much talk, noise and [...]]]> Outbound Calling, the ugly duckling of call centers or the key to goose your center revenues?
By John Cockerill and Colin Taylor

We all know the pressures these days to add revenue, become a profit center versus a cost center in the world of call and contact centers.

While there is much talk, noise and media attention related to inbound and all the vagaries associated with it, many overlook the skills and expertise required for good, sustainable and profitable outbound campaigns. Now for the purposes of this article we will be examining live outbound calling only. So when we speak of outbound we are not referring to automated, recorded or robo calls.

While outbound calling was one of the first commercial examples of call centers in practise, this generally being ascribed to Ford phoning past customers to inform of the arrival of the new model year vehicles in 1954. Since this lofty and highly profitable origin outbound calling has declined due to misuse, ignorance to become a nuisance to many who receive the calls. The ironic fact of the matter is that most marketers do not want to speak with prospects who have no interest in their products or services, but with the low barriers to entry and usage of outbound telemarketing (you just need to have a telephone) many who did not consider themselves marketers, but rather carpet cleaners, painters, and various other service companies began dialling without consideration for marketing or list selection.

We are all familiar with outbound calls as both call center practitioners and as consumers. We all receive telemarketing calls at home, during dinner or when in the shower. We have received these same outbound telemarketing calls that have prompted the creation of ‘Do Not Call’ legislation and lists. Many of us are likely registered on such lists. So today we mentioning we dare telemarketers is about as effective in clearing a room as shouting “Fire” in a crowded cocktail party.

If you are calling consumers (B2C) there are far more restrictions in place; Do Not Call Lists may be rented or secured through third party data shops and must be run against your calling list, depending upon your relationship nature and currency with the names on the list. There are specified calling hours that you must call between and there are state by state prohibitions on calling on specific dates. This is just the tip of the iceberg. Most organizations that place significant volumes of outbound B2C calls have a compliance officer on staff to manage all aspects of legal compliance related to the dialling, data use and privacy concerns. For more information regarding dialling rules and compliance contact the American Teleservices Association (ATA) www.ataconnect.com or the Canadian Radio and telecommunication Commission (CRTC)

Business to Business (B2B) is hampered by less regulation and legislation, but has its own unique challenges.

First, let’s all recall that outbound campaigns start and stop at the direction of the management. Even those campaigns that are on-going and executed daily were originally test and pilots. Hence unlike inbound, outbound efforts or campaigns are discretionary activities for the most part. Outbound also requires more discipline, in terms of adherence to script or outline etc. Outbound calling is a powerful tool in a call centres arsenal.

Let’s look at the key elements of most outbound campaigns. Outbound’s Number one and most significant element is LIST. Like retail’s ‘Location, Location, Location’,with Outbound the key to success is the list. With a good list, well managed, all is possible. Without it, regardless of the skill and knowledge of the managers, all is a waste of effort. According to Ogilvy and Mather 70% of any direct marketing success, including outbound calling, is directly attributable to the quality of the list. So I cannot understate the importance of knowing who you are calling and why.

Anything that can be done to improve the quality of the list before it is called is usually a good investment. These improvements can run the gamut of sophistication from data mining, regression, cluster, geographic, psychographic, behavioural, RFM (recency, frequency, monetary) analysis to simple data verification based on address accuracy, phone number validity etc. The reason this data cleansing is important is that cleaner the lists and data, the more efficient the calling will be. Hence:

Good List = Success
Bad List = Disaster

An example: an insurance company was calling to sell credit balance insurance for credit card. Pervious campaigns performed with a 30% conversion rate. A new campaign with similar agents was hard pressed to get over 15%. Some excellent agents achieved over 20% but they were the exceptions not the rule. 5 days into the campaign the center manager was desperate enough to stop the work. The marketing team was at a loss as to why the performance had changed so much. The list services group was asked to double check the file also because a number of the conversions were in fact black listed in the main files. Upon investigating, it was discovered that the original calling list was mixed up with and included suspended accounts. A new list was generated. New calling was conducted. Within hours the results returned to normal, in the 30% conversion range.

While most people have received some outbound calls from companies and most know about ‘predictive’ dialling few know that that is but one of three types of live dialling that can be used on outbound campaigns. The three live dialling modes are: predictive, progressive or power, preview and hard dialling. Each has it pros and cons, uses and purposes.

Preview
Preview dialling allows the agent to see what information is available about the customer in advance of placing the call. This is often employed when calling high value customers or where the history or interaction is complex and is required to continue the conversation when reaching the customer. A good example use is in the Business to Business market, following up on web leads, or where there is a long, complex sales cycle.

Preview dialling can describe manual or hard dialling where the representative or agent physically dials the call, though it can also reflect simply clicking an icon to initiate the dialling process.

Manual dialling is where an agent is given a list of numbers and manually dials each and completes the call etc. While little used today, is still important to know how to do and control as a base of understanding fore other types of dialling modes Sometimes even now a small list, less then a hundred names or less, requires manual calling for a quick sample or other reason.

Power
Power dialling places calls only when an agent is available to handle the call. Automated diallers consider the priority and the skills of the agent to automatically place a call to the agent. In power dialling, an agent is always available to talk to the customer.

Power dialling calls only when an agent is available and does initiate action until an agent is available, therefore there is no need to not try to predict when an agent will be available like Predictive Dialling. This is a good compromise between production and pacing of the other two modes of dialling.

While good for all campaigns it is especially good for following up on calls were customer service and brand reputation are involved or at stake. For example calls to high value donors or customers where your organizations reputation is important to maintain.

Predictive
Predictive dialling uses algorithms to dial calls in advance of there being an agent available to speak with the customer or prospect. An effective well tuned algorithm enables a call that reaches a live customer to be connected to an agent immediately. This has the effect of maximizing use of the available time of agents in the center. Agent productivity can reach more than 50 minutes per hour. However this productivity comes at a cost; sometimes delivering a call when there are no agents available and the call must be abandoned. These are considered ‘nuisance’ calls or overdials. These settings can be controlled on most diallers and the ratios are sometimes specified in in various State or provincial regulation. A common standard is to keep nuisance/abandoned calls and overdials to less than 3% of the total dials. For best success with predictive dialling, large lists of contacts are required as is a minimum number of agents; usually no few than 8 to 12 agents to be effective and minimize overdialling.
While these modes of dialling are important aspects an outbound campaign. Equally important is , their use and application by the center manager that makes a difference. Knowing when and how to utilize a tool is critical.

Service Recovery
A large financial institution discovered a computer error in 5,000 certificates. These were already on their way to the customers. The error while correctable would damage the institution’s reputation in the market if not resolved quickly. Sending more mail was deemed to be too slow, allowing the problem to fester and grow. It was decided to call and reach every affected customer. An unusual task for a center focused on inbound.

Teams of agents were pulled off regular assignments and retrained to conduct an outbound campaign. Scripts were developed and included a method for the customer to call back on an inbound line into the institution in cases where they thought this campaign was a scam. A special team was devoted to these inbound calls, with a high priority routing to ensure 100% service within 30 seconds.
The team used a combination of manual and power dialling to reach each customer. The script included details about the certificate only the customer and the institute could know. The customers were instructed to use a specific, well known courier firm, with a pre-authorized billing coded. Upon the return of the certificates with the errors, new ones corrected were then resent via courier to the customers. All this was completed within eight days of the error discovery.

99% of the certificates were recovered and returned. Of the customers contacted after the event 92% said that they had a positive experience and thought more highly of the institution than they had before the error occured.

Such is the power of outbound. It is not only just to sell or market products and/or services, although it is powerful for that use was well. Outbound is a valuable tool for every call center regardless of the primary focus and reason for being.

With the introduction of the Do Not Call (DNC) list most people both within the call and contact centre industry and those outside of it, assumed that this would be the death knell for outbound calling. The DNC eliminated huge volumes of people who you couldn’t phone and [...]]]> Outbound, Outsourcing and the new world order

With the introduction of the Do Not Call (DNC) list most people both within the call and contact centre industry and those outside of it, assumed that this would be the death knell for outbound calling. The DNC eliminated huge volumes of people who you couldn’t phone and while there are exemptions and exceptions it forced many firms and organizations to change the way they did business.

Telemarketing or outbound calling was once the primary activity of call centres. Companies employed outbound telemarketing because it works; thirty years ago people often were genuinely happy to receive a call from hundreds or thousands of miles away. Over time more and more companies and organizations began to use to outbound telemarketing themselves or contracted with a third party outsource agency to place call on their behalf. The introduction of predictive dialling greatly improved the number of calls that an agent in a call centre could make and the number of calls soared. Pretty soon consumers were receiving two, three five calls a day and their frustration with telemarketers calling to ‘sell them something’ became common.

Enter the Do Not Call list and the frustration with telemarketing calls crystallized into 150 million Americans signing up. In Canada a DNC list has just been launched and on the first day the number of people calling overwhelmed the operator. It is likely that we will see more than half of all Canadian phone numbers registered under the DNC.

According to Contact Babel Legislation has had an impact on outbound telemarketing activities “14% of respondents said that their outbound calling had greatly
reduced due to legislation, although 56% said that it had reduced in some way (which is up from 41% last year)”. This reduction of outbound activity has been seen over the past decade from approximately a 50/50 split between inbound and outbound to today only an estimated 18% of call centres would define themselves as exclusively or primarily as outbound.

So with fewer people to call what are companies and organizations doing? Perhaps surprisingly they are still calling. Sales calls to new customers are still the number one activity even though the universe of ‘call-able’ numbers has been greatly reduced, cross selling and customer service activities represent other significant segment of outbound telemarketing.

Increasingly companies and organizations look at outsourcing and off-shoring their outbound calling requirements and much of this activity is provided through third party outsource agencies. There are a number of reasons for this:
Outsourced firms tend to cost less than completing the work internally (much less if an offshore provider is employed),
Access to skills, staff and technology that the company may not possess internally,
Compliance issues related to legislation (DNC)

Outbound calling completed by third party firms will generally be completed on a cost per hour basis, on a dollars per sale basis, often called ‘pay for performance’ or P4P, or on a base plus bonus structure. These rate structures reflect risk and which of the parties (outsourcer or client) is accepting the risk. As expected cold call selling is often outsourced on a P4P model as it does not cost the company any money unless the outsource firm actually makes a sale. Of course this is not completely true a company the sponsors high volume P4P campaigns does run the risk of eroding Brand value due to the volumes and/or quality of the calls. Hourly rated programs tend to be service and customer satisfaction type of calls and Upselling, cross-selling and renewal activities are often structured on a base plus bonus basis.

There is a high correlation between P4P programs and offshoring. A casual study completed by the author found that more than 75% of P4P program opportunities reviewed were targeted to offshore firms calling into North America. The reason for this is cost. While it is virtually impossible to make a cost comparison on P4P activities as the unit price varies by product and/or service it is possible to look at hourly costs to establish as baseline. A recent survey completed by The Taylor Reach Group, Inc. found that hourly rates varied across Canada from a low of $20 per hour to a high of $32 per hour for outsource firms located in Canada. Generally Toronto (and other major urban centres) had the highest rates and more distant and/or rural locations had the lower rates. This compares with hourly rates in the $12 to $14 dollar range offshore.

There are challenges and risks to bear in mind before you rush to offshore your outbound telemarketing activities. From an effectiveness perspective these include; language issues, geography issues, inflexible scripting , issues understanding the product or service if it is not prevalent in the culture of the off shore location and issues of context if the offshore agents are not familiar with the culture in North America. There are also risks from a financial point of view; the stated rates do include the cost to source, vet, negotiate nor contract with an offshore service provider, nor do they include the 20%-30% premium to manage an offshore partner. Lastly offshore outsourcers generally have a lower sales conversion rate due to the challenges above. Once these considerations are taken into account to costs offshore become similar to those onshore.

If you are presently completing outbound telemarketing outsourcing to a third party firm should certainly be considered, but you need to ensure that the rate structure is appropriate to the type of calls you wish to have placed (sales, service, satisfaction services etc) that the technology employed is appropriate (predictive, progressive or preview dialling) and that you risks related to legislation are mitigated through a compliance program. The first organization to be fined for violating the US DNC was AT&T, through one of their outsource partners. This is not what you want to have happen.

Outbound telemarketing is not going away any time soon. Companies and organizations that employ or wish to employ outbound calls will need to be vigilant and know and mitigate the risks. Third party outsource firms have developed compliance programs to ensure that their actions are compliant with the rules. Outsource firms have significant risk to their livelihood if they are not operating under the rules, far more than most of their clients would have. And as a result these companies will have and continue to invest in maintaining their compliance.

One of the biggest challenges facing contact centers today is supporting Managements’ goal to shift the contact center from a cost center to a profit center. This can often be akin to pushing water uphill for Center managers who are under resourced and lack an understanding of the [...]]]>