Cold calls to consumers have declined and businesses have become more effective at screening cold calls. However, for many startups, cold calling can still generate revenue and open doors to prospective business clients and suppliers.
Cold calling conjures up images of banks of telesales staff remorselessly parroting scripts while making telephone calls to a list of prospects. Often viewed as a marketing dinosaur, cold calling has been largely replaced by social media and email marketing.
Cold calling definition – what is cold calling?
Cold calling is straightforward. As a business, you can call any publicly listed phone number that has not opted out of telemarketing calls. It’s used by reputable businesses to sell everything from broadband packages to introducing business-to-business services to other companies.
Costs can be cheap. All you need is a phone and a list of customers to call. Alternatively, you can outsource calls to a telemarketing service.
The main aim of a cold call is to talk with a key decision-maker about your products and services. A successful outcome may be a sale over the phone or arranging a face-to-face meeting. It doesn’t always have to be sales-led. Market research firms use telemarketing as a quick way to survey people.
For many businesses however, it has become far more effective to use social media and email to connect to customers. According to research by LinkedIn fewer than 2% of cold calls result in a meeting, and the cost per lead is around 60% more than other channels such as email and social media. Only 2% of customers typically list the phone as being their preferred method of being contacted.
Why use cold calling?
With so much negativity around cold calling, you may wonder why use it at all? Yet, cold calling does have its place. With enough calls, that 2% response rate can turn into a decent number of customers. Even if one call in 50 gets your new business in front of a potential client, it could be the start of a profitable business relationship.
It’s also a good way to get immediate feedback on an idea or product pitch, and to quickly decide if a prospective client is worth pursuing. While email is easily ignored, at least a strong ‘not interested’ on a call lets you move on to other prospective clients.
The following tips can help you make cold calling an effective marketing tool for your business.
1. Keep cold calling within the law
The rules governing cold calling are complex and you’ll face a large fine if you break them. You can also permanently tarnish your brand by cold calling people who have opted out of telemarketing. According to the 2003 Cold Calling Regulations, you cannot phone someone who has expressed a preference and opted out of cold calling. Individuals and companies can opt out using the Telephone Preference Service or the Corporate Telephone Preference Register so check these first.
The General Data Protection Regulations introduced in 2018 also apply if you process any personal data about consumers. Entering contact details into a CRM system, for example, qualifies as processing data, so you’ll need to ensure your business is GDPR compliant.
2. Identify your target market
You’ll have a greater chance of success if you know who you’re calling. Use social media platforms such as LinkedIn to source potential contacts. Trade directories and company press releases are a good way to identify the best person to speak to. If using a purchased list of contacts, ensure it is up-to-date with clear marketing permissions.
3. Research the company
Research the company before you call to discover recent activity. This can help provide an opening gambit, such as congratulating them on hosting a charity event or a new business win. Having shared connections on professional social media platforms such as LinkedIn or attending the same trade seminar can also help open conversations.
4. Create cold calling objectives
Know what you want your call to achieve before you start dialling. It’s rare to snag a sale on a cold call, so keep your call focused on an achievable outcome such as signing up to a trial or agreeing to a meeting.
5. Pick the best time for cold calling
Avoid Monday and Friday when calling a prospective client. On Mondays, staff are busy planning the week ahead, whereas Friday sees them begin to wind down for the weekend meaning they’re less interested in new business opportunities. Similarly, avoid lunchtimes as many people are away from their desks.
The best time to call is 8-9am before the business day gets going, and 4-5pm when people are generally free from meetings. It’s also worth knowing when the company is generally too busy for calls, such as the end of its financial year. If you’re calling consumers, then the best time is mid-morning from 10-11:30am.
6. Open the call strongly
It’s important to get off to a strong start to avoid the brush-off. Practice a strong opening statement, making sure you speak with energy and positivity. It’s a good idea to introduce yourself right at the start and clearly state why you’re calling – be straightforward and check you’re speaking to the right person. A good trick is to ask a question as this turns the call into a conversation and gets dialogue flowing.
7. Use trigger events
Use trigger events to quickly build a connection. Trigger events are activities, such as a new appointment into a senior purchasing role or business expansion that you can use to support your reason for calling. For example, you could call a newly appointed procurement director to congratulate them on their appointment and see how your company could fit into any new plans for suppliers they are considering. Keep an eye on social media and company press releases for trigger event hooks to hang your call on.
8. Ditch the script when cold calling
Scripted calls sound bad. They make you sound stilted and dramatically increase the chance that your call will be cut short. We don’t use scripts in real life, so aim to have a natural conversation with the person on the other end of the line. You can use some bullet points as prompts but be flexible and prepared to go off piste with the conversation.
9. Avoid the hard sell
Most people dislike being the subject of a hard sell. They prefer to feel in control and not pressured into buying something, so resist the temptation to take a sales-heavy approach to cold calling. Instead, focus on the customer you’re calling. Identify their needs and seek ways your product or service can help. Avoid pressure tactics – these may be illegal in some cases – and instead offer incentives such as free trials, more information in the post, or a no-obligation quote.
10. Use questions…
A call isn’t an excuse to race to the end of your bullet points. Avoid talking directly at the potential client, and instead ask questions to draw them into the conversation. Open-ended questions such as ‘who’, ‘where, ‘when’ and ‘how’ will get more engagement than closed questions that just require a yes or no answer. Ask a question such as: “What are you looking for in a service?” rather than “Would you use a service like ours?”.
11. … and actively listen
A good conversation is two way, and you’ll need to be as engaged as you hope the prospective client will be. Active listening is vital. That means really hearing what the other person is saying and responding appropriately both in terms of what you say and your tone of voice. It’s also good to check your understanding of what they’re saying rather than make assumptions. Listening is a key sales tool. It allows you to tailor your offering specifically to their needs.
12. Become a seasoned story teller
Describing a service or product on the phone can be quite abstract. A better way to is tell stories about how your business has helped other, similar businesses. Relevant case studies that tell the story of a challenge and how your products or services provided a solution will bring your business to life for the other person.
13. Plan for difficult questions and objections
Cold calling may seem all about rejection. From difficult questions and objections to simply being hung up on, it takes resilience to carry out telemarketing. Plan for possible objections in advance by compiling a list of typical questions, along with answers.
One of the most common objections is a prospective client who claims they’re too busy to talk. Reassure them that’s fine and ask when the best time is to call back. Encourage them to be specific such as ‘Tuesday at 3pm’ rather than ‘sometime next week’. Ask for their email address so you can send information. Thank them for their time and make a point of calling back when you said you would, reminding them that this was an arranged call.
14. Get gatekeepers on your side
Gatekeepers are the people who stand between you and the decision-maker. They may be personal assistants, switchboard operators, work colleagues or secretaries – and all will field your call before it gets through. It’s worth spending time getting them on your side. Be polite and try to pitch your call as something that will help the business. If they won’t immediately put your call through, try to arrange another time to call.
15. Don’t give up
Cold calling takes stamina and determination. Be prepared for knockbacks. Keep in mind that 49 out of 50 calls will end in failure, and plan for that, allowing time to make enough calls to meet your goal. It’s worth being persistent, as it can take a few calls to get through to the right person and put these cold calling tips into practice.