The DNC Regulations: Prepare, Prepare, Prepare

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The countdown for the implementation of the new federal telemarketing regulations has begun. These regulations will change direct marketing, and the ability to move swiftly, both in understanding the rules and in creating strategies and tactics to comply, will be crucial.

It is time to update and clarify your DM strategy and implement new ways of doing business. Here are some of the critical issues as you prepare to comply with the new regulations:

Ignorance is no excuse. Make sure you understand the new regulations as adopted by the Federal Trade Commission and more recently by the Federal Communications Commission. Have procedures in place to monitor how each state may consider the effect of the federal regulations on its existing rules. Be prepared, ensure your vendors are prepared, and verify that you have a system in place that is compliant with all applicable federal and state regulations in addition to the new FTC and FCC no-call registry and other new rules.

Before the regulations take effect, use telemarketing to solidify as many firm business relationships with consumers in your target market as you can. You have until Sept. 30 to contact consumers while being sure to comply with the existing rules. And once you establish an "existing business relationship," as defined by the new rules, you may continue to use telemarketing that is otherwise in compliance with the new and existing rules to contact that consumer.

Get your direct mail and e-mail house in order. You likely will have to spend more of your marketing budget on direct mail and other direct marketing channels to generate leads. Ensure that your creative is ready and approved by both the legal and business sides of your firm. Be prepared with a variety of messages and offers and the corresponding direct mail creative to support those offers, such as letters, postcards and bill inserts.

Your marketing database, and your ability to segment your targets, is critical to sending the right offer to the right customer at the right time. Though having a segmented database always has been important, this preparation for the new regulations presents a perfect chance to revisit your segmentation strategies.

Get your inbound system ready to respond. You may not be able to acquire as many new customers over the phone, but they can call you. Be ready with prepared scripts and trained inbound agents who can cross-sell all your products and services and act as more than order takers. Your agents' ability to cross-sell can improve your profitability.

You'll need plenty of technical and tracking resources to handle the additional volume generated by your direct mail campaigns. Your tracking systems should be able to tell you why your targets are calling you. Are they responding to a specific direct mail piece or ad? You'll be able to determine which types of campaigns you should continue or expand, and which you should modify or eliminate based on this information. Also look at refining your Business Reply Permits, e-mail addresses, jump pages and links to Web sites.

Your tracking system should let you track the number of abandoned calls. The FCC will require callers to abandon no more than 3 percent of answered calls in a 30-day period whereas the FTC will require callers to abandon no more than 3 percent per day per campaign. The FTC will require this information, so get prepared. This data is also useful for your own planning and efficiency analyses.

If you use outside vendors for telemarketing, compliance requirements of the new regulations make it even more important that your vendors are reputable and accountable. Verify their understanding of the new rules and talk with their other customers. Double-check their scrubbing procedures and ask them about their data-hygiene timing and how they get their lists. Find out their guidelines for agent behavior and get a copy of their agent-training materials. Compliance is king in this environment of expanded regulations, and you will be held responsible if your vendor violates the regulations.

Ensure that your vendors understand how to use strategically all the direct marketing distribution channels at your disposal. It's best to work with vendors that offer a variety of direct marketing vehicles so you can vary your media as needed. It also helps if your vendors are affiliated with larger DM players such as Equifax. This lets them leverage resources and provide you with better value.

You'll need to maintain your own no-call list of residential telephone numbers registered by consumers who specifically requested those numbers not to be called by your firm. Fines for noncompliance of an in-house list can reach $11,000 per customer contact occurrence, even if the consumer does not appear on the federal registry. Ensure that outside vendors can transmit information about consumers who do not want to be contacted to your in-house no-call list.

The new rules consider a call abandoned if it is not transferred to a live operator within two seconds of the called party's completed greeting. When such an operator is unavailable, the seller or telemarketer must play a prerecorded message with the seller/telemarketer's name and telephone number and a notification that the call is for telemarketing purposes.

Plan your telemarketing budget to include the cost of the fees to access the federal no-call registry list. You'll need to pay to update this list every three months.

There is a bright spot to all of this: Though the regulations will result in fewer consumers you can call, those consumers not on the lists will be more open to receiving your call. More than likely you will experience a better conversion rate from the reduced telemarketing target pool. Your customer is still out there, waiting for your offer. You just need to be agile, leverage your resources and understand today's brave new marketing world.


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