Direct Mail Tie Doubles Telemarketing Revenue

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Internet company Galaxy Mall has more than doubled its telemarketing revenue by coupling telemarketing with direct mail campaigns.


The company, a subsidiary of Galaxy Enterprises, Orem, UT, sells Web site design and development, banner ad placement, banner development and some business coaching programs. The company operates a network of 50,000 to 60,000 Web sites on a two-for-one exchange, meaning Web sites in its network have agreed to accept two banner ads from Galaxy Mall customers in exchange for a banner promoting their sites somewhere in the network.


For the past two years the company had been using Professional Marketing International, American Fork, UT, to upsell and cross-sell to current customers or to contact prospective customers who have expressed interest in Galaxy Mall, but never followed through with a purchase.


Earlier this year, in an attempt to broaden its telemarketing efforts, the company began purchasing outside lists from list brokers and using mail as a follow up.


"All of a sudden, our sales went from $80,000 a week to $150,000 to $200,000 a week," said Brandon Lewis, executive vice president sales and marketing and a director with Galaxy Enterprises.


The company, whose target customers are small to medium-sized businesses, has been purchasing lists that have typically been successful in the past for a seminar business also run by Galaxy Enterprises. There are about 20 to 30 lists the company is using.


"An example is Entrepreneur Magazine, that works well for us," Lewis said. "The subscribers are small businesses who are always interested in experimenting, they are open minded."


The company's mail campaigns begin with small "feeler" pieces, which include a redemption card to gauge interest. Customers who express interest receive a package in the mail that includes a 25-page manual, a video, audio tapes and a phone number to call for purchasing products from Galaxy Mall. Half of the sales from the mailings are from incoming calls from customers who have received the mailings.


The company uses the same agents to field inbound and outbound calls.


"Most of our agents work on straight commission - or minimum wage or straight commission, whichever is highest - so agents will jump on incoming calls because that is a golden lead," said Lewis.


The average package sold by teleservices representatives is $3,000, Lewis said.


In the past two months the company has hired two telemarketing managers and begun to develop its own inhouse telemarketing unit.


"Some of the splits and margins and selling expenses with some of the vendors we work with are somewhat expensive, so we thought we'd bring some of it inhouse," Lewis said.


The inhouse unit, which has about 17 reps, has begun to pull in about $45,000 to $50,000 in revenue. The company will continue to grow its inhouse telemarketing unit and hopes to have 30 telephone representatives on staff by the end of September.


The company uses about 45 representatives from outside firms, and while that number may diminish, Galaxy Mall will continue to use outside telemarketing firms - particularly PMI - on some programs that have been running particularly well.
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