Cold Calling is a Waste of Time?

I'm currently managing a small business and am looking at every way possible to increase our client base.

Has anyone tried this program?

Did you find it useful?

Does it contain practical advice or is it mostly vague and metaphorical?

ttt

In my opinion, it is both ineffective and creates a bad identity for the company. I thinkt the average person has had it with soliciters bothering them at home. They even have national do not call list. Often the telemarketers want up to 90% of the money they raise for their customer. My advice would be to look for other solutions.

Sorry, I should have made my post more clear:

I'm NOT in favour of Cold Calling and there are a few "systems" and courses currently available which advocate alternate ways of generating more leads.

For example:

http://www.nevercoldcall.com/?tId=1282KIGI99&sId=hexa&gclid=CNjo8NHOzosCFSOZEAodFTK2Cg

I've heard some of Frank Rumbauskas other stuff and it was good so just wanted to know if anyone here had actually tried it.

Thanks

*edited for spelling

Just googled Tom Hopkins and it all seems pretty vague.

I realise these guys aren't gonna give anything away but I would just like some sort of insight or example of what they can do that's so different.

Why do you want to increase your customer base? Is the end goal more profit (as it usually is when people say they want to increase their user base)?

3 ways to grow a business:

  1. Get more customers (time/resource consuming, high cost, low return on marketing dollars). Even here, though, you can make it easier by appealing to your patient base (get referrals, testimonials, endorsements from your user base to make it easier to sell cold prospects). Targeted mailing lists, solid direct mail pieces, etc will let you measure how effectively you're spending your ad dollars.

  2. Get your current customers to spend more per transaction with you (Upsell, cross sell, package products/services, educate them as to how your products/services work together to give them more value, if you don't have additional products/services joint venture with somebody else to sell theirs at a profit, etc)

  3. Get your customers to do more transactions with you (mailing/calling your current customers to make them special offers - note the difference from cold calling; set them up on a maintenance plan if you offer services - eg a tanning salon that says 'You can pay by the visit, or you can pay for a chunk of 10 visits... but your best bet is to pay us for our winter value package, unlimited usage per month for just X dollars...'; offering things of high perceived value but low hard cost to you to incite them to come in, knowing that on average if they're in you'll make more than the hard cost you spent to bring them in)

Thanks for the response, I'll definitely take those ideas on board.

We need more customers as it is a new business and we haven't established a good base of existing customers just yet.

Makes it even easier to use these ideas, since there wont' be a high cost associated to any of them... haha

Ask yourself, what am I doing to generate referrals? What am I doing to upsell/cross sell? Could I bundle my products/services to offer them more?

What are you currently spending in marketing to bring in your customers? (IE take your total advertising/marketing dollars spent so far, and divide it by your customer base). That's your current acquisition cost of a customer.

So instead of spending that amount to get a new customer, can you offer your current customers preferential pricing, where you still make a profit (IE they come in to buy widget A (net profit to you $30), you offer them widget B (normally net profit to you of $20) - which compliments widget A - for a discount... perhaps you'll only make $5 in profit from it. Well you're still ahead of the game.

Do you know the answers to the following questions:

How much does it cost to get a customer in the door (marketing+advertising costs / customer base)

How much is our average profit per transaction?

What's the average length of our relationship with the customer (ie how many days/weeks/months/years is it between the time they walk in your door the first time, and the time they never walk in your door again?)

What's the average frequency of transactions (Joe Blow comes in twice a week)

Are you collecting testimonials/endorsements from your current clients/customers?

Are you collecting contact information for your current clients/customers?

Are you really adding value to them, or are you just a commodity to them? If the latter, how can you add more value?

Due to the nature of the business, we aren't likely to get customers coming back on a regular basis. It's more of a once-off kind of thing (sometimes twice).

The referral's are definitely something I'll start devoting more effort to. Thanks.

What is the business?

And keep in mind that every business owners first thought is usually "my business is different, that wouldn't work with my customers..." etc. There's usually a way to adapt the strategies/techniques to make them work.

My $.02: Cold calling to sell products, in general, is a waste of time. Not many people want to do business over the phone. However, cold calling to set up face to face appointments in your local market area can work. You need to take the risk out of the appointment for the person on the phone. Something like "I'd like to get together with you for 5 minutes to introduce myself, and leave you with some information." Once you've set the appointment do some fact finding to pre-plan your sales call.

Your first appointment may just be to get in front of the customer and gather some information. But if during those few minutes you can hit on a feature of your product that will really benefit your customer, that 5 minutes can turn into a full presentation. If nothing else, you've turned that person into a warmer lead that you can call on again later.

I would never do it. It makes you look desperate when you bother people at home.

Cold calling for appointment setting is from the stone age.

"Give me five minutes?" Please. When I get those calls--and I get a ton--- I tell that person to never call me again. There is no benefit to the prospect. Why should they meet with you? To get some information ? Why, when they can just say: "Ok, email it to me".

When I call a prospect, they have--in 95% of the cases-- either called me, filled out a form on one of my sites, or emailed me first. Based on their response to my questions, they are either scheduled for a follow up call and added to my e-newsletter and print newsletter or I get them to meet with me.

Start with the basics--the people you know. You'd be surprised how many people THEY know. Each contact can create 100 more.

It totally depends on the industry. In industries like insurance, copiers, recruiting, T1 lines, etc. cold calling is essential.

In industries like enterprise software sales or commercial real estate where the sales campaigns are more targeted, you can not just cold call without knowing quite a bit about your prospects business. When you do all them you can easily get their attention by speaking intelligently about their business.

There are no universal rules that apply to all businesses and industries.

shakes head

You guys are hysterical. How much time do you waste trying to find new clients?

Yes it is.

I make 10-15 new contacts each week in about 3 hours of calling. I really only make warm calls, so almost everyone I speak to has asked for information from one of our websites or an 800#. Honestly if I kicked up my ad budget a bit I could get a lot more, but right now I spend about 1K a month on pay per click and online ads. That generates a 100% return many, many, many times over.

Compare that to the following:

"if i cold-called everynight for a few hours, i was guaranteed to eventually acquire 1-2 clients from just that one night's worth of prospecting, how many other businesses can you acquire 6-7 figure accounts every day by sitting at your desk and calling people "

The idea of "If I cold-called every night (translation: I work 15 hours a day and have no life) I can EVENTUALLY aquire 1-2 clients" is a perfect example of why cold-calling is so outdated and inefficient.

Do you have any idea what making 3 hours of calls every night costs you in real money--time you could be working with clients?

What's your time worth on a per-hour basis?

It is best spent talking to 100 people who want nothing to do with you to find ONE who MIGHT do business with you "eventually"?

Hell, what about LIFE? Who the fuck wants to sit there and make cold calls when you could be spending time with your family or loved ones?

I spend a few hours a week doing my prospecting calls. That's it. The rest of the time is working with clients, networking, etc. Soon all of the non-essential stuff (any paperwork, tracking leads, etc.) will be off my plate too as I'm outsourcing everything which means I will be working about 25-30 hours a week tops and making a very, very good income.

"cold-calling works! i dont work in finance anymore, i went back to school and now have 2 ivy league degrees...however, i intend to start my own business and will be coldcalling for sure"

Have fun wasting hours of your time and working around the clock. If you are really that married to an idea who's time has long since past you are going to be out of business within 2-3 years anyway.

thinkfirst--I only get about 3,000-5,000 visits per month, depending on the time of year. My site converts about 2-3% of people who go to a particular capture page so we're talking about 60-100 leads (forms filled out and submitted) per month on average. Some of those are repeat visits, so let's call it 40-80 invidual leads per month.

The sale cycle in real estate is long, so a lead may not turn into a sale for 6-12 months. Some do convert right away, but that's rare. I sign up between 4-6 new clients per month and most of those will close deals.

So from 80 warm leads I should be getting about 6 closed deals. So for about $1000/month in total advertising costs I get a pretty good returnn.

These concepts work in ANY business. A few good books to read:

The Ultimate Marketing Plan--Dan Kennedy

The Definitive Guide to Google Adwords--Perry Marshall

Pretty much anything by those two authors is great. Both are available from Amazon.

If you like I can also help you directly, I do some consulting work on the side. Post your email and I'll get in touch with you. Hopefully I can at least give you a few pointers to increase your site conversions.

You're wrong in so many ways, and that is why you will fail in business. If it's sooooo great, why did you leave the business? Why did you bother getting two "ivy-league" degrees? Hmmmm?

Could it have been...oh...I don't know...burnout? Or maybe you just weren't that good at what you were doing? I notice you can't point to your own successes with cold calling---only those of your fictional ideal salesman who never gets sick, worn-out, has family commitments, etc.

You think like a salesman. I think like a business owner.

You need to change your mentality or you will not succeed.

12 hours a week cold calling PLUS a 40-50 hour workweek is quite a bit of work. As a business owner you will be putting in a lot more than that. And the reality is--NO ONE with any sort of life does 5 nights a week of cold-calling. If you think money is worth sacrificing relationships, family, friends, etc...well...have fun.

I started out cold calling and I have done very well with it. However, the system I have in place filters the leads FOR me, and pre-qualifies them. It tends to weed out the tire-kickers, time wasters, and pain in the ass types.

My average commission is $10,000. So, for about 50K a month with relatively few expenses (40K of that is net pre-tax profit) I am making MORE than your "million dollar producer" and doing it in far less time.

And, like I posted above, in 6-12 months that income will be higher AND I will be working even less. I will happily trade a few grand a month in advertising for taking home 400K a year for only 20-30 hours a week of work. Meanwhile, enjoy spending your nights cold calling.

I can point to actual numbers. Why? Because unlike you I am actually doing what I talk about. No rah-rah here--just solid marketing theory backed by proven practices.

And you have....

I'll never do another job or have a business where I have to cold call.

Hey, that's great that you're becoming a neurosurgeon. My brother is a doctor and I can't imagine how hardcore the residency req. must be for neurosurgery--it's 7 years, right?

Although I'm not clear on why you'd spend the time and $$$ to become a neurosurgeon and then go start a company. Running a successful company has more to do with finance and marketing than it does technical knowledge of the products or service the company offers. Logically you should get an MBA with a focus on entreprenuership and then create a business plan and go get some capital.

Seriously...all bullshit aside...I would be happy to show you how to get to those ceo's without cold-calling. Warm calls are SO much easier to close.

I know one guy who sells computer systems, software and service contracts in a B2B environment. He researches his most likely prospects, puts together a an info package, and then Fed-Exes it directly to them. His last mailing of 50+ pieces got a 100% response rate and most of those will become business.

Every single one of those decision makers called HIM, by the way.

At least humor me and read "Selling to VITO (the very important top officer)" by Anthony Parinello. It changed my view on how to best obtain clients. Hell, if nothing else hire a call center to do it for you so you can focus on