I heard some great marketing advice recently from cold-calling expert John Eyres. Many online marketers might consider telemarketing “old-school” and question what someone like John could teach them. Believe me, we still can learn a lot from old-school marketers, and we still can generate a lot of business using old-school marketing channels like the telephone.
John’s advice: Estimate your metrics before you call and track the real numbers as you call.
The first metric: Conversations per call placed. If you dial 100 people, how many conversations will you have. Depending on the industry and your list, you may have 15-25 conversations, John says.
The second metric: Meetings scheduled per conversation. If your primary goal for the calls is to schedule a meeting, what percentage of conversations will generate a scheduled meeting? Estimate 10% to 20%, John says.
Based on these estimates, you can project that 100 calls will generate 15-25 conversations which will result in one to four meetings.
The third metric: Close rate. What percentage of prospects with whom you meet eventually become customers. That varies wildly. But you should be able to estimate that for your business. Let’s assume you can close up to 50% of the prospects with whom you meet. That means you might generate one or two sales if you’ve scheduled one to four meetings.
Fourth metric: Your cost — for the phone calls and the meetings. You might hire an outside firm, like John’s, to conduct the calls. You might make the calls yourself. You also must measure the cost of conducting those sales meetings. Divide those costs by the number of sales you project and you have roughly calculated your costs-per-sale.
That’s where Customer Lifetime Value (CLV) comes in. Last month in this space, I discussed the importance of calculating CLV — the net revenue you can expect to generate over the life of a relationship with a customer. If you know your cost-per-sale and you know your CLV, you can determine whether this campaign is worth it. In my experience, a well-executive telemarketing campaign usually is often worth it — especially if you combine the telephone with email follow-up.
When we run telemarketing campaigns, we always ask the contact whether we can add them to our email list. At least half, usually closer to 75%, and sometimes 90% say, “Yes.” So, if 100 dials generates 15-25 conversations and one to four meetings, you might add another 20 or more people to your email list.
Those are people whom you can nurture with additional information. After they read your emails, they may be more inclined to meet with you and eventually may become customers. By combining email with teleprospecting, you improve campaign results without significantly increasing costs. We’ve found this reduces the cost of customer acquisition — making the combined telemarketing/email campaign more profitable than telemarketing alone.
If you’d like more telemarketing tips, I recommend that you read John’s new book, “Master Your Cold Calls: 52 Ways to Increase Sales” which was published in January.