Does Cold Calling and Warm Calling Work?
Cold calling is when you contact a prospect without prior contact or any request for information surrounding your product or service. Cold calls are unsolicited calls. This approach is comparable to a door-to-door salesman, but leveraging telecommunication instead. According to a Keller Center Research Report, the following findings were revealed from the 6,000 cold calls made:
- 330:1 call-to-appointment ratio;
- 209:1 call-to-appointment-or-referral ratio;
- 72% were considered bad calls (or 150 of every 209 calls);
- Average calls last 5 minutes;
- 209 calls take approximately 7.5 hours to complete.
Although many consider this an out-dated technique that does not yield enough success for the amount of effort, a cold call is one of the oldest forms of telemarketing, and organizations still use the tactic to this day. If the numbers above are true across the board, it generally takes about 7.5 hours to achieve one qualified appointment or referral. Although this may seem small, it equates to a fairly strong return on investment for your time.
The Difficulty of Cold Calling and Do Not Call
There are some difficulties and barriers related to cold calling. Due to the unsolicited nature of the call, recipients may reject the call, hang up immediately, or attack the caller verbally. According to the same study cited above, of the 6,000 cold calls made, only 28% were answered, 55% were rejected, and 17% were no longer working numbers. These numbers, and the process itself, can be discouraging.
Robocalling — also known as Robo-dialing — is a recent innovation that takes pre-recorded messages using various algorithms to call a list of individuals without human intervention. In April of 2020, national robocall data shows that there are 95.4 million robocalls made per day. This practice can add to the difficulty of cold calling.
One of the primary difficulties comes from the National Do Not Call Registry (DNCR). This free service was developed by President Bush, the Federal Trade Commissions (FTC), and the Federal Communications Communications (FCC). The intent behind the service was to make it easier for consumers to avoid unsolicited calls that they did not want. These new rules put tighter restrictions on telemarketing as a whole by punishments up to $11,000 per call for contacting a number on the DNCR. The laws did allow the following organizations to contact those on the DNCR:
- Political organizations;
Cold Calling vs Warm Calling
An alternative to cold calling — and often mistaken for it — is warm calling. Warm calling is contacting an individual that was initiated by a sales-facing member within an organization, or the recipient initiated the call from the organization.
Social media platforms like Facebook, Instagram, and Snapchat allow for paid ads that are meant to entice readers. Organizations can also post from their social site without using ads as well. This is generally just enough information to get consumers interested, but not enough to provide all the necessary information. Generally, this is seen through “request more information” buttons that have you enter your email and phone number in.
Prospects provided to one organization from another contact are considered warm calls. Although the referral did not reach out to you directly, the consumer recommending the potential customer creates a relationship that makes this warm calling rather than cold calling. Organizations may offer incentives for referrals, like varying discounts or free gifts.
As you obtain customers, you generally get information such as a home address, phone number, or email. When you have special deals going on you can reach back out to these people. This is considered a warm calling tactic because they gave you their information, but they did not directly request specific information. This tactic should always offer a way to unsubscribe from alerts or physical mail.
How to Improve Cold Calls
There are things to consider implementing into your cold call methodology if you want to improve your success. The tactics paired with tips for building effective client relationships can help your organization drastically. You should rework your cold call plan or script over time, but below are general ways to improve cold call attempts.
Listen to the Prospect
Although your time with a prospect may seem limited, you want to give a chance for the prospect to speak. You want to avoid speaking over them and allow them to respond or ask questions. If you just read straight through your script, then ask for questions at the end, you may be mistaken for a robocaller.
Personalize the Call
Although a general script can help you gain your bearings, you want to personalize your call and make it unique to the consumer. Reading from a script can sound rehearsed and unnatural.
Research and Be Prepared
You will want to do research surrounding your target audience, and you will want to be prepared for common questions that might be asked. As you begin making calls, adjust your narrative accordingly to include any new or relevant inquires you may be frequently getting.
Better Ways to Get Leads and Clients
Although they do produce some results, cold calling and warm calling are largely ineffective, time-consuming, and expensive for the ROI.
There are viable alternatives to cold calling; for example, there are organizations that do not have enough time to understand the lead funnel, so they take advantage of purchasing leads. Real-time legal leads for lawyers can be an effective route to do so.
Another potential route to obtaining leads and clients is to create giveaways. These are limited-time offerings to help gain traction by providing a gift for those who purchase your product or service. You can also consider giveaways with no purchase requirements to create brand awareness.
If your aim is to improve your online presence to organically bring in leads, you may want to consider attending a conference, or a meet-up designed to help brands understand the lead funnel and how to effectively and comprehensively improve your brand.
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