Are Do-Not-Call Lists Death for Marketers?
Romeo, aghast, anxiously inquires about the seriousness of the wound. Mercutio replies: "No, 'tis not so deep as a well, nor so wide as a church-door; but 'tis enough, twill serve: Ask for me tomorrow, and you shall find me a grave man." A moment later, Mercutio is indeed dead.
Today, there are some in the teleservices industry who fear that the recent growth in state do-not-call lists will serve the same blow to telemarketers as Tybalt's sword did to Mercutio. Last month, my own home state, Indiana, passed legislation mandating the creation of a state-wide do-not-call list. By paying a $10 fee, Indiana residents may have their names and telephone number placed on the lists. To stay on the list, residents will have to pay an annual $5 fee.
Certainly Indiana is not alone in its zeal to "protect" its citizens. Currently more than 30 other states have do-not-call lists either enacted or pending, including California, Connecticut, Florida, Maryland, Massachusetts, New York, Pennsylvania and Texas. In seven states, if the consumer says he or she is not interested in the product or service as offered, the seller must discontinue the call. This "no rebuttal" rule holds in Arkansas, Illinois, Kansas, Oregon, Pennsylvania, South Carolina and Utah.
During the period of time when Indiana's bill was being debated, I received a number of calls from several Indiana media professionals asking for reaction to the proposed legislation. The most common question I was asked was: "Will this legislation hurt the telemarketing industry?" I think most of the reporters were surprised when I said I didn't believe do-not-call lists would be the end of our industry.
I explained that most people who feel so strongly about unsolicited phone calls that they would pay to be on a do-not-call list are predisposed to not buying over the telephone. My company, an outsourcing teleservices agency, has no interest in intruding in their lives. We would rather spend our time talking to people who truly have an interest in the product or service we represent.
Usually at that point in the conversation, the reporter would ask me if I was concerned that we would run out of people who are willing to buy over the telephone. That would be when I would whip out the facts. Because, you see, the facts are that even as the number of state do-not-call lists are exploding, the amount of revenue generated by sales made over the telephone has also boomed. According to the Direct Marketing Association, sales by telephone rose from $156.1 billion in 1994 to $230 billion in 1999. Projections for the year 2004 indicate that the figure should come in at $328.6 billion.
Human nature is an interesting thing. Even as a certain portion of the population demands that telemarketers leave them alone, buying over the phone is taking place at unprecedented levels. The apparent contradictions are widespread. In the DMA's Economic Impact: U.S. Direct Marketing Today survey for 1999, it is reported that the states that generated the most sales from direct marketing were California, Texas, New York, Florida and Illinois - all states with do-not-call lists and/or "no rebuttal" telemarketing legislation.
So if legislation isn't driving out telemarketers, is it possible that providers of products and services will eventually bow to a perceived public pressure and stop using telemarketing as a marketing channel? Time will tell, but it certainly seems unlikely. Not only are sales by phone continuing to increase, but according to the DMA's Economic Impact study, return on investment is also increasing.
The DMA reports that it is estimated that in 1999, an investment of 12.4 cents returned $1. It is forecasted that by the year 2004, an investment of only 11.3 cents will yield a return of $1.