Life for Telemarketers After the DNC Registry
Less than a week after the Federal Trade Commission began accepting registrations, consumers had entered 16.9 million telephone numbers to the list. And those figures don't include numbers from the numerous state no-call lists that will be merged with the national registry, though the FTC said it doesn't know yet how many names are unique.
The FTC, which predicts the list will have 60 million telephone numbers within one year, said the pace of registrations was meeting expectations. Many telemarketers who have followed the list's progress also weren't surprised by the early surge of registrations. For others, the list's launch and surrounding media hoopla were cold confirmation that the telemarketing business would never be the same.
"You should've heard the talk" on the day the list launched, said Jon Hamilton, industry veteran and consultant. "You would've thought it was the end of the world."
The launch was marred by problems -- the FTC called them "road bumps" -- on the first day, including an explosion of online registrations that jammed the no-call Web site, www.donotcall.gov. According to comScore Networks Inc., the percentage of consumers who successfully registered dropped from 92 percent to 77 percent by midday June 27.
At one point, between 6 and 7 p.m. that day, the FTC was recording 158 numbers onto the registry per second. No problems were reported with the telephone registration hotline at 888/382-1222, which is limited to states west of the Mississippi River until July 7. However, The Associated Press said an AAA auto club office in Bridgeport, WV, was swamped with calls from consumers who misdialed the no-call hotline.
There also were delays in the transmission of e-mails consumers had to click through to confirm their registrations, and in many cases spam-blocking software inadvertently prevented the e-mails from reaching their targets. But AT&T Government Solutions, the company that launched the list and will maintain it, resolved all the problems by June 28, the FTC said.
With the initial shock over, telemarketers are asking themselves what comes next.
The no-call registry presents numerous possibilities that cause telemarketers anxiety. Some fear that with so much of the consumer population out of their reach, the remainder who don't register for the list will get even more sales pitches -- and subsequently register themselves to escape the calls.
The immediate concern for many is that consumers who registered won't understand the FTC's rules, including that the list doesn't take effect until Oct. 1 or that nonprofit, political, existing-business-relationship and survey calls are exempt.
Telemarketing agents can expect more angry reactions than usual in the coming weeks and should be prepared with explanations for consumers, said Hayley Weinper, senior vice president of sales and marketing at Interactive Teleservices Corp., Columbus, OH.
They will be in the ironic position of having to educate consumers because many of the details have been lost in the FTC's PR campaign, she said.
"There's not been a lot of education," Weinper said. "It's more the hoopla around the fact that you can do it than the mechanics of it."
Another concern is that phone numbers in retailer databases of prior customers will become worthless if marketers don't re-establish contact before the Oct. 1 deadline. FTC rules define the existing-business-relationship exemption as calls to any customer who made a purchase in the past 18 months, or an inquiry or application in the past three months. Companies also can get written permission from the consumer.
Al Babbington, CEO of prerecorded voice mail broadcaster CallCommand, Cincinnati, suggested that retailers go back as far as five years in their databases, clean them and try to re-establish relationships. Acknowledging the danger that such efforts could backlash when past customers get swamped with calls, Babbington warned retailers to engage consumers first with a welcome offer and then ask whether they wish to continue the relationship.
"It probably underlines the fact that you can't take them for granted," he said. "If you don't contact them, you will lose the privilege of talking to them."
Yet another question is how much the industry will shrink because of the registry. Though all telemarketers accept there will be job losses, both at service agencies and their clients, not all agree on the scope of the cuts. Predictions range from the American Teleservices Association, which projects that 2 million of 6.5 million industry jobs will disappear, to others who say the industry will shrink but still has a robust future with some adjustments.
Leading thinkers in the industry have been calling for an end to high-volume "saturation" telemarketing, in which marketers rely on low per-call costs to boost their bottom lines. According to the Federal Communications Commission, telemarketers now attempt to make 104 million calls a day.
Predictive dialers, which maximize call center efficiency, made high call volumes economical. However, once the technology became widespread, telemarketers threw targeting out the window, said Mike Butlien, director of data analysis at advertising firm Innis Maggiore, Canton, OH.
Telemarketing's survival lies in a return to good direct marketing practices, Butlien said. Effective use of databases to target campaigns will ensure the medium's viability, and though the no-call list will hurt the industry, it also will take consumers who don't respond well to telemarketing out of calling databases.
"It should be what it always should have been: Talking to the right people at the right time about the right things," he said. "Saturation telemarketing doesn't do that."
On the record and off, veteran telemarketers acknowledged that the industry could look only to itself to place blame for its troubles. Telemarketing turned out to be its own worst enemy, an effective sales tool that, combined with new calling technology and a lack of self-control by some telemarketers, grew beyond consumer tolerance for it.
"Once we found out that we could sell anything to anybody because it was cheap to do it, the industry went nuts," Hamilton said.