Why it's time to rethink one of the most derided marketing tactics.
Why it's time to rethink one of the most derided marketing tactics.
Most marketing pros would say that Samantha Ettus is going about it all wrong. That's because the CEO of Ettus Media Management, a New York City public relations and branding agency, spends a big chunk of her time working the phones, pitching herself and her clients to people she's never met.
According to the conventional wisdom, that's a big waste of time. Cold calling, the experts agree, is annoying and irritating, an unwanted imposition on busy people. What's more, they say, it's inefficient and doesn't bring in much business. Far better to work through word of mouth, networking, and established customer contacts. It's the mantra of selling: Spend time building relationships and the deals will follow.
Ettus begs to differ. She's been a cold caller ever since she started her business three years ago. Far from being a waste of time, the tactic has helped her six-person firm land some of its biggest clients, including the popular New York City restaurant Ida Mae Kitchen-n-Lounge and the gift and home products catalog Lillian Vernon. Sure, Ettus spends plenty of time networking with current customers and attending events to prospect new ones. But, she says, she wouldn't be where she is today without cold calling. "So many people give up on cold calling because they say it doesn't work," Ettus says. "But it only doesn't work if you are reaching the wrong person."
Cold calling may be the sales tactic that gets no respect. But it really can work -- if you do it right. At a time when people are bombarded by pitches via e-mail, direct mail, and even instant messaging, a phone call is an extremely personal and effective way of making contact. "You need to develop a system and stick to it," says Keith Rosen, CEO of Profit Builders, a New York City sales consultancy that specializes in training people in the art of cold calling.
A good first step, Rosen says, is to stop thinking of such calls as "cold" in the first place. "Lukewarm" would probably be a more accurate description. Ettus, for example, does plenty of legwork before reaching for the phone. "I consider it my job to read everything I can and educate myself on the brands that would be right for our firm," she says. "A bad day for me is one in which I read about an expert or an interesting company that I don't know about." Once Ettus has a potential client in her sights, she hunts down all the information she can find -- career history, memberships and professional affiliations, any awards the person may have won. As soon as she understands who she's dealing with, she crafts, but does not send, a personalized e-mail outlining what her firm has to offer. Then she makes the call. She keeps her pitches as brief and precise as possible -- generally less than a few minutes. Then immediately upon hanging up, she sends the e-mail. "Within minutes of talking to me, the person gets the e-mail," Ettus says.
Obviously, it takes a certain amount of guts to do what Ettus does. And not every call is a success. People sometimes hang up on her. But Ettus doesn't get discouraged. The hang-up is just a sign that she's reached the wrong person and needs to find an alternative contact -- a personal assistant, publicist, parent, or even webmaster (all of whom have helped Ettus connect with an otherwise unreachable prospect).
Fear of rejection is the main reason so many cold callers fail so miserably, says Rosen. A cold call, Rosen argues, is nothing more than a way to introduce yourself and your business to a prospect. Yet even seasoned salespeople are intimidated by the tactic. "You hear things like, 'I don't want to say or do the wrong thing. I don't want to impose. I don't want to be rejected," Rosen says. "The essential theme is 'I.' Making the process about yourself is the No. 1 roadblock." Instead, before picking up the phone, salespeople need to ask themselves, "What value can I deliver to the other person?" Rosen says. (Obviously, if you can't answer that question, you probably don't belong in sales in the first place.) You can't ramble. "You have to be very concise with the language you're using -- there is no time for a second impression," says Rosen, who has developed a script for his trainees to follow (see "Handholding for Cold Callers").
During calls, sales reps take notes, looking for anything that can help them refine their pitch.
Still, not everyone is convinced. Anthony Parinello, the bestselling author of Stop Cold Calling Forever, has built a career on the idea that cold calls are a total waste of time -- no matter how much research you do. "People are not just sitting around waiting for you to call them," he says. "They are thinking about other things." It's far better, he says, to spend time improving your relationships with current customers, as they'll likely refer you to others. "My goal is to get my phone to ring as much as I can," Parinello says. "That means I have to stay off the phone as much as I can."
But don't expect Todd Eberhardt, CEO of Comm-works, a Minneapolis-based telecom services firm, to put down his phone. His 85-person company was practically built on cold calling, he says. In 2003, Comm-works got 52 new customers thanks to cold calling; in the first six months of this year, the company added 77 new clients.
Each of the 15 sales reps at Comm-works is responsible for a part of the country and cold-calls roughly 50 to 70 companies a day. Many reps make as many as 10 calls to a prospect -- exhausting all potential points of entry into an organization. After the initial cold call is made, the reps follow up with their new contacts -- as often as once a week -- until the cold calls begin warming slightly. Throughout the process, sales reps take notes about their conversations, looking for anything that can help refine their pitch, or be of use in direct mail campaigns or at trade shows. Says Eberhardt: "We have to have a proposition that will get us in the door somehow, some way." One of his favorite approaches is to ask a prospect to name his biggest, most intractable problem, the one thing that seems to flumox everyone else. In subsequent calls, he'll ask about that problem and offer potential solutions until he comes up with one that works. It's exhausting and takes quite a bit of persistence, but the strategy has helped Comm-works land some of its largest clients, including RR Donnelly, a printing company that had previously been working exclusively with large vendors like AT&T and IBM.
Ettus feels the same way. In fact, she recently took cold calling to an entirely new level. She was working on a book called The Experts' Guide to 100 Things Everyone Should Know How to Do and was determined to somehow convince 100 busy, well-known individuals to contribute, free of charge, 600-word essays on everything from how to negotiate a deal to how to hit a tennis ball. Ettus didn't even have a publisher. But that didn't stop her from tracking down, and selling, such well-known strangers as Larry King, Donald Trump, and Jennifer Capriati on the project. "It's proof that cold calling really does work," says Ettus, whose book was published in September. "None of these people would be in it if I relied on my connections -- because I didn't have the connections to these people. It makes me feel like I truly can get to anyone."
Even seasoned salespeople are put off by cold calling. Profit Builders' Keith Rosen suggests the following script as a starting point.
Hi, ________ (state his or her name). Did I get you at a good time? Great! I'm sure you are busy, so I'll be brief. The reason for my call is this. We specialize in __________ (working with business owners, salespeople, managers, etc.) so that they can:
*State compelling reasons No. 1 and No. 2.
Mr./Mrs. ____, I don't know whether you need our services. But with your permission, I'd like to ask you a few questions and see if there is anything we do that you could benefit from. Would you be comfortable spending a few minutes with me if I stick to my timetable?
(Set confidentiality.) Mr./Mrs. ____, I want you to know that, regardless of whether or not you become one of my valued clients, everything we talk about will be held in the strictest of confidence.
1. What's working well? What do you like about your current (vendor/solution provider)? What would you improve or change?
2. What solution would we have to offer that would motivate you enough to explore working with us?
3. If you could magically eliminate three of your biggest headaches, what would they be? How do these problems affect you and your job?
(Summarize and confirm what the prospect has shared with you, using the following clarifiers.) From my own understanding, what you are saying is _______. Is that accurate? Would it be safe to say that if there were a way for you to solve ______ (restate biggest obstacle or problem), it would be worth exploring in more detail? Then let's get together for ____ (state timeline; example: 20 minutes) to see if there's a fit.
(Once you determine the meeting time, continue with:) Fantastic. I'm looking forward to meeting with you on ____at ____. Have a great day!
Excerpt from The Complete Idiot's Guide to Cold Calling by Keith Rosen. Reprinted with permission by Alpha Books, a member of Penguin Group (USA) Inc. 2004.