Chapter 5
The Future of Telemarketing



Telemarketing has grown very rapidly over the past fifteen years, as Telemarketing grows, many important new trends emerge that can shape and influence Telemarketing quickly in the future.

5.1 Global Multilingual Telemarketing

Global multilingual Telemarketing is expected to increase during 1990s. thanks to the opening of world markets, the spread of international 800-number service, and the fact that for multinational firms, foreign sales are growing by 15 percent, compared to a 4.5 percent domestic growth rate.

How Telemarketing has prospered in other countries depends upon how many phones a country has. It's a fairly common apparatus in countries like France and Great Britain, but practically nonexistent in Brazil, which has only one phone for every eleven residents. Telemarketing is growing in Japan, although high phone rates mean it is used primarily as a business tool. But the growth rate for Telemarketing activities is surging everywhere as telephones proliferate and rates decline.

Whether calls are domestic or international, multilingual marketing lets firms expand into new markets and improve customer service and customer loyalty by enabling them to speak in a language their customers understand.

"We will see global Telemarketing expand a hundredfold in the future," says Ken Knecht, an expert of Telemarketing. "As international telephone rates come down, it will be possible to take calls from anywhere in the world and place them, too."


5.2 A Tighter Labor Market

Labor market experts predict a 39 percent increase in marketing and sales positions in coming years, making it one of the fastest-growing segments of the economy.

As opportunities for Telemarketing grow, the supply of qualified help will slow. To attract and retain employees, employers will have to offer a whole host of benefits designed to meet the needs of a new generation of workers. Part-time, flexible, and stay-at-home jobs are expected to increase as employers make their workplaces more family friendly. More generous family-leave policies and child-care subsidies can also be expected, because they help lower turnover and improve productivity.

But Telemarketing is not a recession-proof business, and some Telemarketing operations will fold. One example is Sears, when Sears shut down its catalog in 1993, it also closed seven of its eleven "telecatalog" centers and shifted the surviving centers from order taking to handling customer service calls.


5.3 Increasing Focus on Sales and Service

Many people believe that Telemarketing is the perfect growth tool for an economy that is moving from a manufacturing to a service base. "The more people this industry trains, the greater the potential for the U.S. service industry," "Telemarketing is all about customer contact, dealing with the public. It gets us away from the old manufacturing mentality." says Henry Greene, an expert of Telemarketing.

"Telemarketing is finally coming out of the closet, as it were," says Greene, "Companies are using it proudly. It's not stuck in the basement, it's on the first floor. Over time, improved technology will make it an even more personal marketing tool."


5.4 Privacy Legislation

One trend that will absolutely affect the Telemarketing industry is the increasing demand for privacy regulation. The privacy controversy arose around the use of automatic outbound dialers that can be programmed to ring every number in a given exchange. Privacy advocates argue that outbound Telemarketing invades the sanctity of an individual's home and should be limited. Others don't mind receiving telephone solicitations, but believe that their hours should be limited. The only question is exactly what changes legislation might require.

The first major piece of legislation to limit Telemarketing was the Telephone Consumer Protection Act, signed into law by George Bush. It requires consumer marketers to: 1. Limit outbound calling hours to 8:00 a.m. to 9:00 p.m. in the recipient's time zone. This is no problem for today's sophisticated software, which automatically halts calls to each time zone at the given deadline. 2. Maintain a permanent "do not call" file of people who have asked not to be contacted by the marketer. It's up to the marketer, not the service bureau, to maintain this list. While consumer awareness of this new option is rising, only about 1 percent of consumers contacted request "do not call" status. The act also banned prerecorded commercial messages to residences without the consent of the called party, although this rule was later struck down by a federal judge.

In the face of new privacy legislation, some marketers are returning to direct mail to prospect for new business, reserving Telemarketing for calls made to customers or prospects they have already contacted. But legislation is not the only obstacle to Telemarketing. The same technology that permits massive Telemarketing applications also enables consumers to keep out unwanted callers. Consumers can use Caller I.D. to avoid calls from unknown numbers.

Neither legislation nor technology will have much impact on the business-to-business segment of Telemarketing. Buying and selling products and services is the heart of business, and it will continue despite the controls placed on outbound consumer Telemarketing.


5.5 The Electronic Superhighway

Much is made of the new "electronic superhighway" that is projected to replace today's telecommunication system. Now being constructed through an alliance of cable, telephone, and software companies, the system is expected to permit interactive communications between homes and businesses. The superhighway will allow consumers to choose from a vast selection of entertainment programs, or shop at home by viewing merchandise from an extensive menu and placing orders through a remote keypad.

Without a doubt, telecommunications technology will be essential in making the electronic superhighway a reality. The new interactive media can replace the need for a live voice on the phone.


5.6 Marketing of Telemarketing

The concern for quality is in the marketing portion of Telemarketing. Over the past several decades of growth, much more sophistication in telephone techniques has developed and the ability to move beyond simple telephone sales has been enhanced. But truly to earn the right to use the term Telemarketing the industry must go further.

If problems can be overcome and the industry keeps moving forward, the size and complexity of Telemarketing programs will continue to grow. The level of marketing expertise of clients( whether internal or external, will certainly continue to increase. The number and the subtlety of suitable Telemarketing applications can be expected to explode to remarkable new levels. The range of quality and complexity of products and services offered by phone can be expected to rise dramatically. Both the total dollar volume and the average size of a Telemarketing order will continue to grow. And the sheer volume of calls will be staggering.

If the industry is not only to keep pace, but also to stay a step ahead of the complexity of challenges and opportunities that the future will bring, there is a very significant need for improvement in the quality and sophistication of the industry's marketing capabilities and techniques. The ability to coordinate with and use state-of-the-art marketing research, direct mail, print advertising, and the electronic media must improve. And the systems, software, and hardware required to use effectively the innovative new methodologies that have been developed must be created.

With the improvement in the quality and sophistication of those areas must come the development of more effective methods of results projection and program analysis. There is a need to increase sales and research capability while improving the back-end results and order fulfillment techniques.

On account of the above considerations it can be anticipated that several driving forces that will continue the expansion of Telemarketing:

  1. Continuing demand for convenience and speed in the transaction of business.
  2. Continued improvement in the capabilities and the price performance of computer technologies and telecommunication.
  3. The abundance of software support systems that facilitate the development of more extensive and more creative databases about customers and potential customers.
  4. Continued increase in the cost for other forms of communicating with customers.
  5. Increase in the knowledge of how to develop successfully and operate telemarketing programs.


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