This was a question asked by a client of mine so I shot a brief video exploring the topic in more detail, sharing my experiences of outsourcing to telemarketing agencies, and providing some advice as to what you should do if you decide that cold calling is a marketing channel for you.
You can listen below, or watch the video, or you can read the transcript below the video.
I also shared more on my experiences of cold calling in this previous blog article: How I wasted Thousands Cold Calling.
Hi Everyone, Martin Williams, Consulting Compass
I wanted to shoot this quick video in response to a question raised by Nadine in our Facebook group and Nadine asked: Is cold calling, especially when done by others, a good strategy? Which is a great question and it's been interesting to see the responses of others to that question.
Fritz's is of the view that there are better ways in which to generate leads, Daniel has said that in their business, they do, do cold calling, but only in response to specific things, like maybe driving attendance at a networking event. And Nadine herself also said that she's not against cold calling, so long as you're really clear as to who your ideal client is, and how you can help them.
Now, in my consulting business, I have cold called myself and I've also outsourced cold calling to telemarketers, so I have some experience as to whether it's good or bad thing to do. And I think really depends, it depends on how you approach it. And the first thing to consider is that really there's two types of cold calling. There is the absolute cold outreach, and then there's warm calling, that I'll get to a moment. But essentially what cold calling, in it's rawest form is, is where you have a list of numbers that you would typically buy - and most of these marketing lists that you can buy are generally around 50% out of date - so you buy a list, half of which might be of use to you, and you basically get calling. What you're really trying to do, and you have to think this through, you're trying to get in touch with a complete stranger, get them on the other end of the phone. Which means you have to get through any gatekeepers, voicemail, full voicemail boxes - you generally need to call the number somewhere between five and 10 times to even be able to get through. And when you talk to that individual, you are hoping that they have the particular problem that you know that you can solve, that they're struggling with, and that they don't have any incumbent that's already helping them, or f they do then they're not happy with that incumbent. That they're willing to talk to a complete stranger about the problem that they've got in order for you to then move that forward to a potential sales opportunity. So it's a huge ask - a real needle in a haystack. Which is why the success rate of cold calling is somewhere between 1% and 3%. So there's a lot of work involved in raw cold calling
And then is the warm call. And a warm call is much more a follow-up call. So that's where somebody has already made touch with your business in some way. So maybe they've downloaded a free guide, a lead magnet, where they've shared their contact details in order to access it, and you're following up. Or it's a referral from somebody. But already the person you're calling has, in some way, shown some interest in your business. So that's a completely different, and in my mind much more effective, use of cold calling. And you can get telemarketers to do that outreach, or you can follow-up yourself as well.
So let's consider for a moment, why do you people cold call? And I think when it comes to the consulting business, consultants often cold call out of desperation. It gets to a point where they don't have enough leads, they don't have enough opportunities in their pipeline, they need to drum up some activity. And they've been told that the quickest way to do that is to hit the phones. I've been told that before when I've engaged coaching in the past. So really, people turned a cold calling as a last resort. It's a challenging thing to do. When you do cold calling, you have to be ready to accept rejection. If anything, you have to target getting 10 rejections a day rather than one Yes, because you have to go through a lot of rejection in order to get any success from it. So it is challenging to do yourself, which is why it's very tempting to outsource, rather than go through the pain every day yourself. Why not outsource it to a telemarketing agency, who you might assume love making calls to random strangers! Some of them do and are good at doing that as well. That was why I chose to outsource it in my consulting business some time ago.
The challenge, however, particularly when choosing an outsource agency is, in my experience, not many of them give you strategic advice. So they're very quick to take your money, to go and do the cold calling for you; and to have a list of numbers; and you can sometimes get a bit excited by the numbers. The sheer volume of numbers that these agencies can offer you. But they don't give you strategic advice in that, if you're going to cold call it needs to fit within some kind of funnel or some kind of purpose. Just to call complete strangers and say, "Hi, I'm Martin from Consultancy X, we do this, do you need some?" is not a particularly smart strategy. It would be much better to take a warm call approach where you have a guide that focuses on the particular challenges that you can help people with, someone downloads it, they reach out to get in touch. So it's more a position within a flow of getting you in front of your ideal clients. So lots of telemarketing agency don't really talk about that, they don't really talk to you about where does cold calling fit within your particular funnel or your particular plan.
The other challenge with cold calling agencies is that everyone that will tell you to go and do it will say, "Oh yeah, you pay them on results." I didn't know any cold calling agencies that only gets paid on results. And why would they because the cold calling agencies don't know how good you are at making a sale. You might be able to get to a position where you have a hybrid model, where you pay them a base fee, and then for each meeting they arrange, you pay them a bit more. And that's a great approach to take so at least they've got some skin in the game. But they can only be successful if your materials are good in the first place. If you've got your ideal client really targeted, if you're really clear on what the problems are that they are faced with, that means you can then get the call, and the next part of the process. So in my experience, I've not come across telemarketing agency that says, "Oh yeah, just pay us if we're successful." I can't see how that model would really work. I'm sure you can find outliers out there.
Which brings me to the question, does cold calling work? Is it a good strategy? I don't think cold calling, in and of itself, is the right thing to do. I do not think you should just be calling random strangers in the hope that they will want to talk to you. When I did it, I was absolutely naive about it. And from the many, many numbers that I had the telemarketing agency call, I managed to achieve a couple of meetings and they were the complete wrong type of prospects. I should not have rushed to the meeting, which is what I had been trying to do. Trying to get the telemarketers to book me a meeting with these strangers. And when I went to meet them, you can almost tell straightaway, as soon as you turn up you think this this is wrong, these are not the right kind of clients that I'm looking for. So actually, cold calling is not the thing to do.
Warm calling makes total sense. If the client or prospect has already reached out in some way and they've shown some interest then it makes sense to call them. And I would argue that you could probably do that calling yourself rather than to outsource because the numbers aren't going to be that high. If you focus your time on effort instead of creating good guides, and you put them as gated content on your website, which means people have to put in contact details in order for you to follow up, then the volumes and numbers there aren't that great. Unless you just feel that you're absolutely terrible on the phone and you want somebody who's more of an expert that can try and get you the call. But then put it in some kind of process. So the way I would do it is I would have some kind of guide that captures contact details, follow up with call and if you're going to outsource that call then what you want the telemarketer to do for you is to schedule the next call. Don't jump straight to a face-to-face meeting because that is a complete waste of your time if they're the wrong prospects. So instead have the telemarketer really be the appointment setter, the appointment generator, which you then follow up with a strategy call. You can then qualify, when talking to the prospect, if they're the right kind of client for you, and if you can really help them. At that point, it makes sense to schedule a face-to-face meeting. And if you're a b2b consultant, selling to mid to large organisations, then you're going to go and meet people face-to-face this is not gonna work in an online business capacity. You should be out there seeing your clients on their premises. So the cold calling agency is really one small part in the process. They fit into your wider plan of how you're going to generate leads and opportunities.
The other thing to do, if you're going to work with a cold calling agency, don't just leave it down to them, right. On the first day. first of all meet the person that is going to be doing the calls, and then on the first day shadow every single call that they make. So that you can hone and tweak it, so that you can evaluate the quality of the caller, you can see the type of objections that they're meeting when they're getting through to people. And if you don't, maybe you don't sit there all day, maybe you get the recording sent to you at the end of the first day. But for the first week, I would monitor every single day, listen to every single call, understand objections, understand where the cold caller can be better at what you're trying to get them to do. And then I would review it at least every week for the whole time you outsource this function, because then you can continually hone, adapt, tweak and improve your message to market. And you'll also learn a lot from the process. You'll learn what are the hot buttons; what are the keywords; what are people getting excited about; what are they not turned on by; which part of your messaging is just not resonating with them. And if that works really well you could then have this as a regular strategy where you outsource it or do it yourself.
So to recap, does cold calling work, is it a good strategy? Cold calling in and of itself, no it's a terrible idea. Warm calling, whether you do it yourself or you outsource it, is a great idea! If you can understand where in your pipeline, where in your process it fits in, it's appropriate to make a call, that's where I were to do it.
And if I look in my own experience, I'll give you one example, where in the past and I was helping organisations achieve compliancy to take credit and debit card payments - long complicated topic - I was helping them outsource it. So what I did is I wrote a guide that said this is how you do it, this is how you outsource your credit and debit card payments. I made that guide available on my website. I gated it so that I requested people's name, email address and phone number in order to download it, and then each time somebody downloaded it, I would give them maybe five days and then I would call them and I would say, "Did you get the guide? Was it of use to you? Is there any further information that you want?". And from that I was able to successfully win more work because I would then take that call and qualify the opportunity, see if I could help, see if they were the right type of organisation, see if they were interested in me helping them. I would then schedule a meeting. From the back of that I won lots of consulting engagements that were from £5k upwards.
That was a warm call. It was not a cold call. When I did the cold calling I spent £4,000 pounds in cold calling that resulted in two meetings and it was a complete waste of money. Absolute and utter complete waste of money.
So, long story short cold calling no, warm calling yes. Thanks for listening and enjoy your calling.