Newsday Set to Outsource Teleservices

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Newsday, a 575,000-circulation daily newspaper serving Long Island and parts of New York City, is shutting its in-house teleservices division next month following the activation of New York's state do-not-call list.

The move culminates a yearlong shift away from telemarketing as the newspaper's main marketing channel, said Stu Vincent, spokesman for Newsday, Melville, NY. All 92 positions in the Newsday teleservices unit will be eliminated at the end of May, and Newsday will outsource its teleservices operations. New York's DNC list became effective April 1.

The newspaper will continue to do targeted telemarketing through its service provider, which Vincent declined to reveal, but will scale back call volumes. With telephone sales rates declining and the obstacle of a state DNC list, Newsday executives determined that an outside firm could do its telemarketing more cost-effectively.

"We were finding [telemarketing] was becoming less and less successful," Vincent said, but he declined to give specifics. "It might well be attributed to the same reasons that the law was brought into effect."

More than 1 million New Yorkers have signed up for the state's DNC list, more than any other state that currently maintains such a list. The list's popularity has sent many newspapers, which depend on telemarketing to acquire and maintain customers, scrambling to find ways to reach consumers without the risk of violating the law.

Diane Kennedy, president of the New York Newspaper Publishers Association, said she expects telemarketing to remain a mainstay for newspaper marketing efforts. Many newspaper circulation and marketing departments are still deciphering the law. One question that arises repeatedly is whether newspapers are allowed to make follow-up calls to people who have received free samples of the newspaper but are on the DNC list. Kennedy suggested calling consumers first, offering a sample and asking permission to make follow-up calls. The DNC list affects only calls made explicitly to make a sale, she said.

The law also does not affect calls made to encourage subscription renewals because calls to existing customers are exempt, Kennedy said. But the legislature might toughen the law if consumers complain about loopholes.

"It's hard to say what the legislature will or won't do," she said. "It depends on how many people complain to the Consumer Protection Board, saying, 'This law is not tough enough.' "

In place of telemarketing, Newsday has switched to targeted mailings to its core market in Nassau and Suffolk counties. The newspaper also includes inserts in newsstand copies with a business reply card and an offer of 13 weeks of Newsday home delivery for $2.50 a week and three free weeks for those who buy with a credit card.

Newsday also has focused on raising its visibility in the communities that it serves through face-to-face contact with consumers, Vincent said. The newspaper regularly opens kiosks at community events such as street fairs and holds community forums about once a month. At the forums, Newsday editors and reporters speak and answer questions in a town hall-like atmosphere. The paper also hosts breakfasts with business leaders to try to increase awareness by word-of-mouth.

Newsday has particularly focused on increasing its presence among minority communities by targeting ethnic neighborhoods and business groups for its forums and breakfasts, Vincent said. Recent census results showed high levels of diversity in the areas that Newsday serves, and the paper aims to bring its product to populations with little tradition of daily newspaper readership.


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