TELEMARKETING AS A PROMOTIONAL T O O L ITS EFFECTS AND SIDE EFFECTS
Kenneth C. Schneider
Abstract—Telemarketing has added a new medium to the marketer’s bag of tricks. This article briefly discusses the benefits and limitations of telemarketing as part of an overall marketing campaign. It then proceeds to discuss (via some new findings) the potential side effects that telemarketing may have on the image of the firm using it.
Introduction
Telemarketing—conducting direct marketing campaigns with the use of telephone systems— has become very popular among marketers over the past ten years. The Direct Mail Marketing Association ranks telemarketing as the “fastest growing marketing medium today.” 1 Telemarketing has assumed a position of new respectability in the marketer’s mix for communicating with customers. Should such growth continue unabated much longer, and there is no evidence of a letup, telemarketing could become the marketer’s “li’l darlin’ ” by the end of the 1980’s.
That trend, coupled with similar growth in other forms of direct marketing, has spawned a new breed of consulting specialists to train marketers in the use of telemarketing and, where appropriate, provide one-on-one consulting in the design of specific campaigns.32 In addition, many leading advertising agencies have tooled up to assist advertisers in their attempts to explore telemarketing. According to Bernard Cohen, media specialist with New York Telephone, thirteen of the top twenty advertising agencies have established special direct marketing units. But despite that response, says Cohen, “a lot of people including advertising agencies are not up on [telemarketing]. And if they’re not familiar with it, then how familiar would their clients be?”14 Marketing specialists, corporate or agency, can no longer afford to ignore this innovative communication medium. Nonetheless, the popularity of telemarketing is unprecedented, having reached the $10 billion mark by the early 1980’s.14,15 Consider the following documented applications:
The Term Paper on Direct Marketing Concepts Versus Direct Mail
Direct Marketing Concepts Versus Direct Mail Direct mail is a marketing technique by which the seller sends marketing messages directly to the buyer. Unlike with other forms of marketing communications, such as TV advertising or placing articles in newspapers through media relations, it is not necessary to have another medium carrying the message with direct mail. With direct mail, seller has ...
Kenneth C. Schneider is Professor of Marketing and Marketing Research at St. Cloud State University. He received a B.S. (Economics) in 1970 and M.S. (Quantitative Analysis) in 1972. He received a Ph.D. (Quantitative Analysis—major; Marketing—related) from the University of Minnesota in 1975. His articles have appeared in Journal of Marketing, Journal of Retailing, Decision Sciences, California Management Review, MSU Business Topics, Journal of Consumer Research, Journal of Business Research, and elsewhere. Vol. 2 No. 1 Winter 1985
29
THE JOURNAL OF CONSUMER MARKETING
Gulfstream American Corporation, using the telephone, ferreted out numerous leads for its Commander Jetprops.10 A.B. Dick Company used telemarketing to service over 100,000 small accounts-customers who annually purchased such a small volume of supplies that it made little sense to have salesmen assigned to them.21 Montgomery Ward used telemarketing to enroll 300,000 of its own charge customers in a new Ward-sponsored automobile club.21 These examples represent three major areas in which telemarketing has already been shown to make substantial contributions: generating sales leads, servicing marginal accounts, and promoting consumer goods and services. To these can be added such applications as improved customer service (e.g., by responding to customer inquiries concerning product use), upgraded cash flow (e.g., by speeding up the collection of past-due accounts), enhanced customer research (e.g., by conducting survey to update customer information files), or even new product testing.19 The popularity of telemarketing is unprecedented.
The Research paper on The Role of Information Technology in the Marketing of Bank Services in Nigeria
Ifezue (2003:38) lists some banking services that had been revolutionized through the use of information technology as including account opening, customer account mandate, and transaction processing and recording. The financial service industry had been subjected to various major transformations due to advancement in computers and telecommunications. Information technology (IT) infrastructures are ...
sored by Merrill Lynch) and major news events (sponsored by U.S. News and World Report).
While innovative entrepreneurs will undoubtedly continue to identify novel applications for telemarketing, its major role in consumer marketing will likely remain that of enhancing consumer advertising and sales campaigns. Originally conceived as an aid to the marketing of manufactured consumer goods, telemarketing has recently shown signs of success in other areas of consumer marketing. For example, its presence has just begun to be felt in the retail industry. Consumers today have neither the time nor the inclination to approach shopping as the recreational activity it once was. 4,24,29 It is estimated that nonstore sales, including telemarketing, are increasing at a rate three to five times faster than store sales.28 It was once thought that the answer to traditional retailing would lie with interactive videotex systems, which make possible in-home shopping. Indeed, the first commercial system of its sort was recently introduced in Florida.8 However, telemarketing is both less complex and less expensive for most retail applications. It may be at least a partial answer to the problems facing the hurried, harried shopper. Telemarketing also has an emerging role to play in the marketing of services, which now account for nearly one-half of all consumer retail spending.
Two of the recent examples include its use in the insurance industry6 and in conjunction with organization membership drives.27 Telephone campaigns have even found their way into a variety of nonprofit applications. Its role in fund raising extends far beyond the political arena, as can be shown in two current examples. The Michigan Opera Theatre recently used telemarketing to increase its donor base. In some 700 hours of calling, the Theatre identified 1,200 new donors and raised funds at an average rate of $92 per hour.16 Similarly, the Chicago Museum of Science and Industry received donations averaging over $300 each from 7.5 percent of the prospects it contacted in a telemarketing campaign.12 Telemarketing, then, has a role to play across a wide variety of consumer marketing applications, from manufactured consumer durables and nondurables to retail and service marketing,
The Essay on Summary of Chapter 6 Analyzing Consumer Markets – Marketing Management book by Kotler, 2012
CHAPTER 6 – Analyzing Consumer Markets The aim of marketing is to meet and satisfy target customers’ needs and wants better than competitors. Marketers must have a thorough understanding of how consumers think, feel, and act and offer clear value to each and every target consumer. Successful marketing requires that companies fully connect with their customers. Adopting a holistic marketing ...
The Role of Telemarketing in Consumer Marketing
Telemarketing may not only have given marketers a new tool—it may have spawned a whole new entertainment medium. Consider the following creative example: The Infophone system offers one-to-two minute information programs on a number of subjects For each program, Infophone sells time to a maximum of five sponsors, whose commercials are inserted in the middle of the program on a rotating basis. To hear the program of their choice, consumers call a toll-free 24-hour telephone number. And if they want to know more about a sponsor’s products or services, they can be connected directly to the company, which can use the contact to make a sale, secure leads for sales reps or survey groups of consumers.22 Among others, this ingenious system now offers programs on Wall Street activities (spon30
TELEMARKETING AS A PROFESSIONAL TOOL—ITS EFFECTS AND SIDE EFFECTS
even to nonprofit marketing. Its use will no doubt proliferate during the remainder of the 1980’s and into the 1990’s.
The Advantages of Telemarketing
Telemarketing offers a number of advantages through a single advertising medium. Proponents, indeed, are quick to point to these benefits.17-21 Personal contact. First, telemarketing is more personal than other mass media though, admittedly, less so than personal selling. Market researchers often point out that for survey research the telephone offers some of the personal touches otherwise attainable only through more expensive face-to-face interviews.9,33 Salaries, travel expenses, and inflation have raised personal selling costs to $200+ per call—$600 + per closing—a fivefold increase in just ten years.3’25 Telephoning, though less personal, can provide some degree of human contact at much less expense—just $7 to $10 per industrial call or $3 per consumer call.21 Telemarketing has a role to play across a wide variety of consumer marketing application. Flexibility. Second, telemarketing tends to be flexible, both within a given call and across a campaign. Scripts can be prepared to move the message in one direction or another, conditioned upon the prospect’s response or level of receptivity. In addition, pretesting scripts is both inexpensive and realistic. Various approaches can be tested “in-field” until a promising one is uncovered. Finally, if a new angle is happened upon halfway through the campaign, it can easily be incorporated in the remaining calls. Measurability. Third, telemarketing is measurable: you either make a sale or you don’t; you either find a prospect or you don’t. Lack of measurable sales results has long plagued the advertising industry. Telemarketing should have some appeal to any account executive who, after having been queried by the client as to the sales effectiveness of a particular campaign, is obliged to discuss the role of attitude change or, worse yet, the importance of audience likability scores.
The Essay on Consumer Psychology And Marketing Communications 2
At any given moment during the day, decisions such as which brand of merchandise to purchase, which color paint to select, or what cable service provider to go with are being made by consumers. The selection and behaviors of the consumers go beyond their personal preferences and has been studied by psychologists for over a century. Knowing what appeals to consumers and what their preferences are ...
Time Compression. Fourth, telemarketing offers a degree of time compression where that is important, as, for example, in the promotion of seasonal or fashion-oriented consumer goods. AT&T provides a good illustration: The Swim Shop of Nashville, Tennessee, sells to swim teams—including school swim teams. It must pack a major part of its sales into a short season. To do this, it speeds up the sales cycle with Telemarketing, which gives it instant order taking, instant shipment. By reducing the information-handling cycle, Telemarketing “extends” its sales season.17 Effectiveness. Finally, telemarketing is very effective—at least when compared against other direct media. In one head-on test against direct mail, the mailed piece generated the typical 1.5 to 2.0 percent response whereas that same piece including a toll-free 800 number generated an 18.0 to 20.0 percent response.32 Other studies have shown that the “use of telephone, in conjunction with direct mail efforts, is 2.5 to 7 times more effective than direct mail alone.” 1 Unfortunately, since “mass” media are themselves not easily subject to sales measurability, it is difficult to contrast their effectiveness vis-a-vis telemarketing.
The Term Paper on Consumer Attitudes Towards Counterfeit Products
Counterfeit products and materials are knock-off, bootleg, pirated or other illegally produced materials that are produced and sold in violation of the Intellectual Property Rights (IPRs) of others or in a manner that fraudulently represent their quality or origin (Porteus, 2002). Despite the various anti-counterfeit efforts of multinationals and international trade organizations, counterfeiting ...
Limitations of Telemarketing
Although proponents of telemarketing are more than willing to point out its benefits, they are somewhat less willing to air its limitations— and there are several. Cost. To start with, although telemarketing is exceedingly cost effective vis-a-vis personal sales calls, it stacks up much less favorably against other media on a cost per thousand basis. The typical firm-originated telephone call carries a price tag somewhere in the neighborhood of $5.00. Most ad managers would not be particularly impressed with a $5.00 cost per thousand much less cost per contact. Product not seen. Second, most consumer goods, and many industrial goods, are advertised more effectively through visual rather than audio means. Goods such as automobiles, apparel, and food must simply be seen to be appreciated. Telemarketing as a stand-alone advertising medium shares with radio an inability to provide these sorely needed visual cues.
31
THE JOURNAL OF CONSUMER MARKETING
New marketing requirements. Third, telemarketing presents a series of new challenges to marketing managers since it is a hybrid approach, combining elements of both advertising and personal selling. Those accustomed to more traditional print and broadcast media will be challenged by the need to recruit, train, and motivate telephone sales representatives—a key to the success or failure of any telemarketing campaign.18 Kestler20 discusses one technique for motivating these personnel through the use of Theory Z management. On the other hand, managers more accustomed to personal selling will be challenged by the need to create and test structured, often scripted, messages. This effort will require, possibly for the first time, working closely with the creative talents of an advertising agency.19 Less application to consumer markets. Fourth, it may be somewhat more difficult to realize the full potential of telemarketing campaigns in consumer marketing applications than in industrial or business-to-business applications. At least that is so according to one author32 who discusses three advantages of telemarketing campaigns designed for industrial buyers vis-avis consumers: (1) the wider variety of sales calls needed, (2) better lists of customers and/or prospects, and (3) the presence of a sales force to follow up on leads.
The Research paper on Consumer Trust In Green Marketing
The whole marketing related processes and activities aim to build a good relationship with the consumers in order to successfully implement the desired marketing goals. One of the most crucial aspects of this marketing-consumer relationship is – trust. Consumer trust plays, actually, the major role in the marketing activities. Not taking the “consumers’ trust” aspects into consideration, as ...
Most relevant among this list is the admitted absence of quality customer and prospect lists in consumer marketing. Most managers in consumer industries have long operated from a mass market perspective. As telemarketing continues to make gains in these industries, managers will be forced to adopt a more targeted approach to their markets, perhaps even culminating in a closer long-term relationship between consumer marketers and their customers, as is now more typical of industrial settings. While not feasible for all consumer markets, such a change in perspective would certainly be appropriate for manufacturers of consumer durables and, at least at the local level, retail and service firms. Effect on company image. Finally, telemarketing may carry certain undesirable side effects—if you will, spillovers on the image of the sponsoring firm. Those in the marketing profession automatically classify telemarketing as one more choice in the grab bag of media through which messages can be brought to the buyer. To the consuming public, that may not be
32
the case. The following conversation between Mr. and Mrs. Jack P. Consumer is not apt to be taking place in households across the country: He: Who was that on the phone, dear? She: The bank. He: Oh, are we overdrawn again? She: No, they were promoting Individual Retirement Accounts with telemarketing. He: Gee, that’s interesting. What a novel media in which to invest their advertising dollars. She: Yes, and so much more personal than stuffing another direct mail piece in our monthly statement. He: Isn’t that the truth. Yet I can’t help wondering about the cost per thousand they must be incurring. The point is simply this: although marketers may perceive telemarketing as nothing more than a minor variation on a well-established theme, in the eyes of the customer it may represent a discontinuity with the status quo of advertising. It is not really known what impressions it leaves people with after the phone is disconnected. Following the old adage to “proceed slowly in strange waters,” marketers ought not to presume that consumers regard telephone calls to their home as equivalent in form and purpose to TV and radio commercials, magazine and newspaper ads, and so-called junk mail.
Telemarketing is not a simple, unified approach to communication. There are at least two troublesome areas in this regard. The first deals with the intrusiveness of telemarketing. Calling one’s home, it cannot be denied, is de facto more intrusive than interrupting one’s favorite TV show with a commercial or cluttering up one’s favorite magazine with an advertisement. Notice that the issue raised here is not about invasion of privacy in any legal sense, that battle, hopefully, having been laid to rest.5,26 Rather, it concerns whether or not consumers see firms that employ telemarketing to be in any way inconsiderate. One marketing executive, quoted by Theodore Gage,13 put it this way: “As far as the mail’s concerned, the garbage can is only an arm’s length
TELEMARKETING AS A PROFESSIONAL TOOL—ITS EFFECTS AND SIDE EFFECTS
away . . . Mail is pretty inoffensive. But the phone—especially if certain companies use persistent operators—can be a real and unavoidable nuisance.” The second area, a more serious one, deals with consumers’ perceptions about the propriety of utilizing telemarketing, again not in any legal sense but in the more subjective realm of ethics. The question here is whether or not consumers ask themselves, “Can this firm, which just tried to sell me something over the phone, be respectable.” To put it in more positive terms, do consumers feel that firms utilizing telemarketing are trustworthy, reputable, and honest? These possible side effects are not minor or irrelevant. If operating, they can be explosive negative consequences in the long haul, far beyond the achievement of any short-term sales goals. Shortly, a bit of data will be brought to
bear on these matters. First, however, since the potential side effects are more serious in some applications of telemarketing than in others, it is useful to recast the discussion in terms of the various types of telemarketing that exist. Telemarketing, it can be argued, is an automated medium that is fast becoming more automated.
Types of Telemarketing
Telemarketing is not a single, unified approach to communication. Rather, it is a collection of sometimes divergent modes, tied together solely by a certain physical device—the telephone. Exhibit 1 represents an attempt to schematically structure the various types of telemarketing. There are at least eight different ap-
33
THE JOURNAL OF CONSUMER MARKETING
proaches, catalogued along three dimensions: type of customer, call originator, and other media employed in the campaign. Type of Customer. Telemarketing, of course, came of age in the consumer market. Recently, however, industrial firms have increasingly turned to this medium. As the head of R.H. Oetting & Associates, a telemarketing consulting firm, recalls: In 1972, when the average cost of a sales call was only about $32, industrial marketers represented maybe 4% of our attendance at seminars entitled “Management of the Telephone Marketing and Sales Operation.” The rest were consumer-oriented companies which learned telemarketing early in the game. But in 1979, when the industrial sales call cost hit the $137 mark, industrial companies began to wake up and now account for fully 80% of our audience.32 Despite such increased use, it’s doubtful that image spillover is of much concern in industrial applications. Industrial buyers likely recognize the cost effectiveness rationale behind telemarketing and, in fact, likely understand it to be a variation on an old theme. Indeed, a good many buyers may well appreciate a reduction in personal sales calls. Call Originator.
Telemarketing is a very different animal depending upon who is the caller and who is the “callee.” Applications in which the call originates with the customer are commonly referred to as “incoming,” whereas those originating with the firm are “outgoing.” The former currently dominate telemarketing, having virtually exploded following the installation of AT&T’s 800 system. According to one estimate, as many as 700 people per minute use an 800 number in response to some television commercial during peak winter months.30 Furthermore, applications of incoming telemarketing extend far beyond late-night TV commercials for the latest record album or magazine. Citing the soaring cost of gasoline, the growing number of working women, and more demands on leisure time, Chain Store Executive7 sees considerable growth ahead in the use of Wide Area Telecommunication Services (WATS) by major retailers. Although incoming telemarketing may dominate the scene today, the greatest growth potential belongs to outgoing telemarketing.13 This is in one way unfortunate since it is just here
34
where the specter of side effects looms largest. A consumer would hardly initiate a call via an 800 number, possibly place an order, and only then begin to wonder about the firm he or she just did business with. The problem of side effects crops up when the consumer receives an unannounced, unsolicited call from the firm. Other Media. Although telemarketing can be successful standing alone as the sole medium in a campaign, its real value is as a support medium within a larger campaign. Consider this argument: While the telephone provides the advantage of a personal sales call and can stand alone as a direct response marketing tool, knowledgeable users see its most effective use as a major component of a media mix. Used with advertising or mail it provides the added leverage that almost always boosts the results they would obtain from just a single source.32 Although incoming telemarketing may dominate the scene today, the greatest growth potential belongs to outgoing telemarketing. Why? When it is used as part of a multimedia campaign, many of the advantages of telemarketing can be achieved while at the same time several of its limitations are circumvented. For example, print or broadcast media can be employed in the early stages of a campaign, thereby benefitting both from their lower cost per thousand and their visual cues. Later on, when the prospect pool has been narrowed, telemarketing can continue the campaign just among “hot” prospects, thereby controlling its otherwise suffocating costs. Unfortunately, neither stand-alone nor multimedia campaigns can circumvent the issue of side effects, which persist, at least potentially, across all outgoing consumer telemarketing applications. We now turn more directly to the problem of side effects.
The Side Effects of Three Types of Telemarketing
A recent survey* was designed, in part, to investigate the potential side effects of tele*The data collection forms were mailed to a random sample of 1,800 residents of the Minneapolis/St. Paul metro-
TELEMARKETING AS A PROFESSIONAL TOOL—ITS EFFECTS AND SIDE EFFECTS
marketing on company image. Each respondent in the survey was presented with one of three short scenarios describing variations of outgoing consumer telemarketing. These scenarios are shown in Exhibit 2. Scenario A depicts a situation in which the message was delivered “live” (i.e., by an actual person).
In Scenario B a computerized approach to telemarketing was employed; a recorded message was delivered to prospects contacted by random digit dialing techniques. Finally, in Scenario C, the message, once again “live,” was preceded by a feigned
survey related to the product being promoted. This technique is sometimes used to get a “footin-the-door”—or, in this case, a “voice-in-thetelephone-receiver.” After reading the scenario, each respondent was asked to respond to a series of four, sevenpoint semantic differential pairs describing the health equipment manufacturer that sponsored the promotion. These pairs of opposites were: “old-fashioned vs. modern,” “inconsiderate vs. considerate,” “dishonest vs. honest,” and “un-
Exhibit 2
Scenarios Used in Survey of Consumer Reactions to Telemarketing Scenario A—”Live” Message Version “A manufacturer of health equipment for use in homes was deciding how best to promote a new type of exercise machine. After discussing a variety of ways to advertise the product, the company settled on making phone calls to individual home owners. However, after hearing about many difficulties in advertising by phone, company employees made these calls only on weekdays from 9:00 a.m. to 5:00 p.m. and from 7:00 p.m. to 9:00 p.m.” This manufacturer i s . . . . Scenario B—”Computerized” Message Version “A manufacturer of health equipment for use in homes was deciding how best to promote a new type of exercise machine. After discussing a variety of ways to advertise the product, the company settled on making phone calls to individual home owners. However, after hearing about many difficulties in advertising by phone, company employees made these calls only on weekdays from 9:00 a.m. to 5:00 p.m. and from 7:00 p.m. to 9:00 p.m. A computer was programmed to randomly dial phone numbers and play a recorded message. This allowed the company to make many more calls per day than would otherwise be possible.” This manufacturer i s .
. . . Scenario C—”Disguised” Message Version “A manufacturer of health equipment for use in homes was deciding how best to promote a new type of exercise machine. After discussing a variety of ways to advertise the product, the company settled on making phone calls to individual home owners. However, after hearing about many difficulties in advertising by phone, company employees made these calls only on weekdays from 9:00 a.m. to 5:00 p.m. and from 7:00 p.m. to 9:00 p.m. Employees began each phone conversation by pretending to be conducting a survey on physical fitness. Of course, after a few questions the conversation switched from a survey to advertising for the new product.” This manufacturer is . . . .
politan area. In an effort to increase the response rate, both preliminary and reminder notification was sent to each respondent. A total of 489 responses were received, representing a response rate in excess of 25 percent. As is typical of survey research, responses were somewhat biased toward higher income and education levels. However, preliminary analysis indicated no significant income or education effects upon response, at least among those from whom responses were received.
friendly vs. friendly.” Mean responses to the four semantic differential pairs for each scenario are presented in Exhibit 3. Conventional Telemarketing Scenario A represents the approach most typical of outgoing, consumer applications of telemarketing in use today. Fortunately, it re35
THE JOURNAL OF CONSUMER MARKETING
suited in mostly positive reactions toward the hypothetical health equipment manufacturer. Generally, the sponsor of this sales program was seen as relatively modern, honest, and friendly, and neither considerate nor inconsiderate. Thus, conventional telemarketing appears to have no serious negative side effects on consumers’ perceptions of the sponsor and, in fact, can have a mildly positive effect. Automated Telemarketing Telemarketing, it can be argued, is an automated medium that is fast becoming more automated. Bencin3 describes a complete computerassisted telemarketing system that would have been passed off as so much science fiction not too many years ago. But, realistically, how automated can telemarketing become? Completely, it seems. Consider: When the phone rings this spring, a computer may be calling to offer you a subscription to a newspaper or magazine. If you accept the offer, the computer will record your name and address so that your subscription can be entered. The computer, invented by Computer
36
Dialing Systems, Inc., of Princeton, N.J., will automatically dial your number within one second, deliver a 30- or 60-second message, record your answers to questions, hang up, and proceed without hesitation or human prompting to dial the next number on its lists.11 So far, the system has been utilized by radio stations, life insurance companies, trade journals, real estate firms, restaurants, church groups, and political parties. Such automation has the potential to bring new meaning to the word “intrusion.” Opponents of such promotional devices point out that 193 automatic dialing machines could call every U.S. residence in a week.15 Nonetheless, the technology for Scenario B is here and functioning. Eleven percent of telemarketers contacted in a recent survey indicated that they were currently recording messages, responses, and/or prospect lists by computer.34 And that technology is not terribly expensive. Whalen31 reports on one system, called Telsol Electronic System, that can be programmed to dial telephone numbers, deliver messages,
TELEMARKETING AS A PROFESSIONAL TOOL—ITS EFFECTS AND SIDE EFFECTS
and record responses. One such unit, costing under $10,000, can replace up to six full-time employees. In one sense, the ready availability of these fully automated systems is unfortunate because that level of automation does not score very well on side effects. As might be expected, computerized telemarketing leaves the impression of an ultramodern firm—significantly more modern than under conventional telemarketing. (Here and elsewhere, the term “significant” refers to a statistically significant difference in mean response between two scenarios at the 5 percent level, or less).
While many firms might view such an image as positive, it also carries definite negative components. Compared with conventional telemarketing, the company using computerization techniques is seen as significantly less considerate and less friendly. Thus, firms contemplating such an approach must heavily weigh the benefits against the considerable risk of deleterious side effects. Few firms would survive in the long haul sustaining an image of being inconsiderate and unfriendly. Telemarketing with Disguised Messages Selling under the guise of research has long been criticized as unethical by market researchers.2,23 However, it continues to be employed on occasion and, with the increased emphasis on telemarketing, is likely to surface with far greater regularity. At least on the basis of the results of this study, it has no redeeming value. Like computerized telemarketing, it leaves a strong impression that the sponsoring firm is both inconsiderate and unfriendly. However, unlike computerized telemarketing, there is no counterbalancing positive reaction—the firm using it is seen as no more modern than one using conventional telemarketing. Perhaps most damaging, though, disguised messages raise the ugly specter of dishonesty. The hypothetical firm using a disguised message was perceived to be significantly less honest with this scenario than when either of the alternative approaches was used. The perception of dishonesty can prove a fatal blow to the reputation of any firm. From this point alone it seems prudent to avoid disguised messages altogether. Whatever benefits might accrue from holding consumers on the telephone would almost
surely be overcome by the bad taste left when the survey suddenly or subtly became a sales message. A related issue needs to be raised here. Posch,26 in a very poignant discussion of the legal issues surrounding telemarketing, informs us that the Supreme Court does indeed protect commercial speech under the First Amendment, thereby effectively cutting off several legislative attempts to curtail or ban unsolicited commercial telephone calls. However, whereas there is no such thing as a wrong idea in personal speech, the same claim cannot be made of commercial speech. The First Amendment does not extend to deceptive or misleading claims made in commercial speech. One sure way to get the FTC, which has been quiet regarding telemarketing since 1980, actively involved again is through a resurgence of such deceptive practices as feigned surveys to introduce a telephone sales message. Such misleading practices, along with other related high-pressure tactics, simply cannot be tolerated—not for the sake of the sponsoring firm nor, indeed, for the sake of the continued availability of telemarketing across American industry.
A Concluding Comment
Not much can be done to evade the major limitations of telemarketing. However, ad managers and account executives alike should be wary of its potential side effects, especially when it is used in conjunction with outgoing, consumer campaigns. Though there seems to be relatively little to worry about when it comes to conventional telemarketing, the recent movement toward automation could prove counterproductive. Computerized telemarketing techniques should be implemented with caution. Although these may not prove offensive to well-targeted audiences (e.g., previous customers), they may backfire under conditions more akin to cold prospecting. Besides, recall that several of the advantages of telemarketing were its personal nature and flexibility. Automating the whole system essentially throws these benefits out the window. At any rate, it is advisable to be very careful with the reputation of one’s firm or client.
37
THE JOURNAL OF CONSUMER MARKETING
Finally, it is h i g h l y r e c o m m e n d e d that t h o s e u s i n g t e l e m a r k e t i n g avoid e v e n t h e a p p e a r a n c e of d e c e p t i o n or h i g h – p r e s s u r e tactics in tele-
m a r k e t i n g c a m p a i g n s a n d , for e v e r y o n e ‘ s sake, e x p o s e s u c h tactics w h e n e v e r t h e y c r o p u p in the industry.
End Notes
1. ABA Banking Journal (1982), “Phone Soliciting: Five Ways to Dial M-O-N-E-Y,” 74 (June), 22. 2. Baxter, Richard (1964), “An Inquiry into the Misuse of the Survey Technique by Sales Solicitors,” Public Opinion Quarterly, 28 (Spring), 124-134. 3. Bencin, Richard L. (1982), “Electronic Marketing 1990: How You’ll Handle Tomorrow’s Selling,” Industrial Marketing, 67 (August), 58-60, 64. 4. Bodec, Ben (1981), “Special Report: Direct Marketing—New Agency Money-Maker,” Marketing and Media Decisions, 16 (September), 187-200. 5. Caming, H. W. (1983), “Are Unsolicited Calls Illegal” Telephone Engineer and Management, 87 (February), 80-81. 6. Canadian Insurance (1983), “The Age of Telemarketing Is Here for the Agent/Broker’s Office,” 88 (September), 10, 12, 20. 7. Chain Store Age Executive (1981), “Customers Dial N-O-N-S-T-O-R-E-S-H-O-P-P-I-N-G” (March), 95. 8. Chain Store Age Executive (1983), “Electronic Retailing Enters the Realm of Reality,” 59 (October), 37-40. 9. Churchill, Gilbert A. (1983), Marketing Research: Methodological Foundations, 3rd ed. Chicago: The Dryden Press. 10. Cooper, Robert H. (1981), “How to Revive ‘Cold’ Prospects by Phone for Million-Dollar Sales,” Industrial Marketing, 66 (August), 72. 11. Editor and Publisher (1980), “When the Phone Rings, A Computer May Be Calling,” 113 (May 3), 20. 12. Fund Raising Management (1983), “Hybrid Telemarketing Program Ringing Success for Museum,” 14 (September), 70-71. 13. Gage, Theodore J. (1980), “Telephone Rings in the Last Frontier,” Advertising Age, 51 (January 21), S-10, S-12, S-14. 14. Gloede, Bill (1982), “Growth of ‘Telemarketing’ Could Signal Opportunity,” Editor and Publisher, 115 (April 17), 16. 15. Haugh, Louis J. (1980), “Telephone Marketing Rings Dispute,” Advertising Age, 51 (February 11), 60. 16. Helmer, M. K., and C. L. Ritchie (1984), “Quick Telemarketing Tests Lifts Michigan Opera Theatre,” 15 March), 42-54. 17. Industrial Marketing (1982), “Marketing in the Age of Information Is Telemarketing,” 67 (August), 47-54. 18. Januz, Lauren (1984), “Positive Attitude Boosts Sales by Phone,” Publishing Trade, 3 (January-February), 34. 19. Johansen, Mary E. (1983), “New Lifestyles Fuel Direct Response Boom,” Ad Forum, 4 (May), 34-36. 20. Kestler, George (1983), “Telemarketing and Theory Z: More Productive People, Systems,” Zip, 6 (March), 57-58. 21. Kobs, Jim, and Murray Roman (1982), “Mail Supported by Phone Can Lift Response Dramatically,” Direct Marketing, 45 (September), 44-45. 22. Lyons, Marjorie Siegel (1981), “A New Idea in Telephoning Selling,” Duns Business Monthly, 113 (October), 107. 23. Marshak, Seymour (1975), “Marketing Researchers Face Extinction Without Action Against Threats from Inside and Outside the Industry,” Marketing News, 7 (March 14), 4.
38
TELEMARKETING AS A PROFESSIONAL TOOL—ITS EFFECTS AND SIDE EFFECTS
24. Oetting, Rudy (1982a), “The Telephone: Now and Future Marketing Medium,” Direct Marketing, 45 (July), 57-58, 185. 25. Oetting, Rudy (1982b), “Telemarketing: An Answer to Rising Sales Costs,” Direct Marketing, 45 (August), 72-73. 26. Posch, Robert J. (1982), “Telephone Marketing—It Survived and Prospered,” Direct Marketing, 45 (September), 106-107, 109. 27. Pruitt, Y. J., and R. G. Tarkington (1981), “Call, Don’t Just Write to Market Membership,” Association Management, 33 (September), 59-61. 28. Rosenberg, L. J., and E. C. Hirschman (1980), “Retailing Without Stores,” Harvard Business Review, 58 (July-August), 103-112. 29. Slosberg, Mike (1980), “Direct Marketing and Retailing in the 80’s,” Direct Marketing, 43 (October), 100-102, 106-110. 30. West, Gary (1982), “OUT or IN, Dialing Delivers Dollars,” Advertising Age, 53 (January 18), S-39, S-41. 31. Whalen, Bernie (1981), “Marketers Use Automatic Phone Robot to Conduct Surveys, Promote Services,” Marketing News, 15 (November 27), 1-2. 32. Wingis, Chuck (1981), “Telemarketing: A Great Idea Whose Time Has Come,” Industrial Marketing, 66 (August), 71-79. 33. Zikmund, William G. (1982), Exploring Marketing Research, 1st Ed. Chicago: The Dryden Press. 34. Zip (1984), “Computerization Survey Results,” 7 (February), 17-18.
39
