Promotion of business services is one of the most prolific applications of telemarketing. If you…
Can We Get Telemarketing Back on the Rails?
Every American is familiar with the onslaught of unwanted telephone calls – usually referred to as robocalls. Many people get a few each week; some get several every day. The standard advice now is “don’t answer the phone if you don’t recognize the calling number.”
That’s not how the telephone is supposed to work. How did it get so broken? Aren’t these calls illegal?
Yes, most of the calls we don’t want are a violation of one or more of the myriad laws intended to protect us. Fraudulent calls (“I won the lottery and I’m gifting you $250,000”) are always illegal.
Far more common, and usually also illegal, are telemarketing calls. These calls may not sound fraudulent on their face; they pitch some product or service that may be quite legitimate. Some are of dubious value and others are a complete rip-off. Categories include Medicare supplements, help with debts and taxes, medical braces and alert bracelets, assistance enrolling in disability or food card programs, extended auto warranties, and help filing legal claims – to name just a handful.
The Feds invented the Do Not Call (DNC) list so that consumers could opt out of those calls. Once a subscriber registers their number (there are about 250 million numbers on the list), it is illegal for a telemarketer to call that number without “the subscriber’s prior express invitation or permission.”
DNC sounds like a simple and effective solution. It puts each consumer in control of their own phone. Why is it not working?
It is helpful to step back and look at how telemarketing works (and how it doesn’t). This slice of the advertising, marketing and selling world is almost as old as the telephone itself. It has become much more sophisticated in the digital age and is a niche industry in its own right, with companies specialized in various aspects of the process, cooperating and competing with one another.
It doesn’t make sense for a business trying to telemarket its product or service to simply call telephone numbers en masse. That’s not efficient; the seller wants to better target its efforts. And with so many numbers on the DNC list, it needs that express invitation or permission. The quickest way to do that is via the web.
The telemarketer also needs to be a web marketer, driving prospects to a site where they sign up to be called. A third party may do the web marketing, invoking paid search or banner ads or pop-ups, which can get quite expensive – driving up the cost of each lead.
To ensure that everything is compliant with regulations, the web marketer may decide to use a verification tool that makes a movie of each web site visit, capturing the prospect entering their name and phone number and clicking a box confirming that they consent to receive phone calls in response to their inquiry. For a prospect registered on the DNC, this is the critical “express invitation or permission” required to override the DNC constraint.
On its face, this is a palatable system. Sellers (those making the phone calls) can buy lists of “consented leads” from marketers that are paying to advertise on the web and drive those consumer sign-ups. In theory anybody receiving a resulting phone call will be happy to get it – they were looking for an insurance plan or debt consolidation or whatever they expressed interest in via the on-line form they filled out.
But like almost every other money-driven ecosystem, this one is subject to compromise. And that has happened, in an enormous way. Many would-be web marketers have found it much more cost-efficient to program a computer or even hire offshore talent to fill in those web forms using publicly available lists of names and phone numbers. Or they re-enter data from a list acquired from another marketer – sometimes using years-old data.
It isn’t difficult, for example, to scrape the internet to find data for millions of people 64 and up – perfect targets for those pitching Medicare-related or other services targeting older Americans. Entering that data on the form (and having the verification movie that makes it look real) is much cheaper than developing and paying for a web marketing campaign. Lists of hundreds of thousands or even millions of prospects can be generated in days or hours.
One might wonder how much this happens in real life. It happens a lot because it can be so lucrative. Some industry experts estimate that OVER HALF of consented leads result from bots or human fraud farms. That would account for over a billion illegal calls each month.
Because each of these fake leads did not come from the real subscriber associated with the called number, they are not valid. That leaves the caller exposed to government enforcement actions from the FCC, the FTC and state AGs. And it leaves them exposed to liability through private lawsuits, to the tune of $500 or even $1,500 per call.
The safest strategy for a telemarketer is to simply avoid calling DNC-registered numbers.
Alternatively, if the caller insists on using the “express invitation or permission” exemption, gather those leads exclusively organically. Do not buy leads or pay referral commissions or in any other way incent third parties to compromise your integrity and put you at huge risk.
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