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Why Cold Calling Is Dying and What It Means for Sales

Updated on September 24, 2017
heidithorne profile image

Heidi Thorne is an author and business speaker specializing in sales and marketing topics for coaches, consultants, and solopreneurs.

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Cold Calling is Old Calling

Cold calling. Ugh! The mere thought of making an uninvited call on a new prospect—whether in person or on the phone—would strike fear into even some of the most seasoned salespeople. But it worked and used to be one of the key ways to drum up new clients in a sales territory.

Today, however, it's not working as well. Why? Is it because salespeople are less brave or less skilled at turning prospects into customers? No! Interestingly, it's been changes in customers and how they behave that is eliminating cold calling from the sales playbook. Plus, new regulations to protect consumers are making it even illegal in some cases.

What are those changes? And what can salespeople and small business owners do to get new clients and battle sales slumps that doesn't involve cold calling?

Time and Space

Unfortunately, some of the negative reputation that the sales profession has is well deserved. Telephone tricks such as leaving mystery messages (a phone etiquette no-no!) are easily ignored or even met with hostility that these days can spread to the web and social media.

But there are even more fundamental reasons why the cold call is becoming a dinosaur.

Today's customers, whether in the B2B (business to business) or B2C (business to consumer) arena, want to be served on their time schedule and where it's convenient for them. In a Wired.com article, Three Emerging Behaviors that are Reshaping Branding, it reports that as demands on attention continue to increase, customers are becoming more adamant about reclaiming their time. So cold calling salespeople, whether on the phone or in person, are unwelcome intrusions on people's time.

There are also two significant issues relating to where salespeople contact potential customers that are making cold calling less and less effective.

First, mobile phones and devices have enabled people to work and handle personal business anytime, anywhere. So they don't have to stay at home or in the office. And many people will refuse to answer calls from unrecognized callers on their mobile phones.

Next, heightened security concerns for homes and office buildings may make physical cold calls impossible. Doors may not be answered or security may escort sales personnel off the premises if uninvited or unscheduled.

For salespeople, time and space issues come into play as well, especially for B2B sales. The number of small businesses in the United States has increased by 49 percent since 1982 according to the Small Business Administration. And the number of businesses that are based in homes, as well as telecommuting employees, continues to increase as well. According to the 2010 Census, the number of home based workers has shown steady increases since 1999. This makes cold calling sales strategies ineffective since serving a sales territory filled with many small accounts or widely dispersed home-based buyer contacts can be very time consuming and unproductive.

What do you do when you receive a cold call in person or on the phone?

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Cold Calling Killers, Part I: Internet Marketing and Inbound Marketing

In today's sales environment, customers prefer to initiate contact with retailers and vendors. Part of that can be in response to aggressive sales techniques of the past. A "don't call us, we'll call you" stance is common. Selling and serving customers by letting them initiate contact is referred to as inbound marketing.

Fueling the inbound marketing trend is the evolution of the Internet. On the Internet, customers can look up product or service information 24/7/365, even initiate contact via email and online submission forms. They can sometimes complete an entire purchase in the middle of the night, regardless of whether the business is open for business or not. No salesperson required!

While the Internet has brought the end for cold calling as we know it, the Internet is also the beginning of the following new alternative marketing strategies.

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Cold Calling Killers, Part II: FCC TCPA Rules

On October 16, 2013, new FCC (Federal Communications Commission) TCPA (Telephone Consumer Protection Act) rules went into effect that will kill off cold calling by phone and text messaging. Basically, the new FCC TCPA rules specify the following:

  • "Unambiguous prior written consent" must be obtained prior to making any telemarketing calls or text messages. Calls that are auto-dialed or use software to bring up phone numbers, or are "robo" pre-recorded calls, are specifically targeted in the rules.
  • Being on the telemarketing list cannot be a condition of purchase.
  • The consumer must specify the number at which these telemarketing calls will be allowed. In other words, a web or paper consent form cannot pre-fill a phone number.
  • The "prior business relationship" exemption no longer applies. Telemarketers used to be able to justify these calls by stating that the consumer had done business with them.

This is another way that cold calling will go the way of the dinosaur.

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Alternative Sales Strategies to Cold Calling

So now what? How can salespeople and small businesses connect with new prospects if cold calling is no longer a viable option?

  • Content Marketing. Content marketing is creating blog posts (either on the company blog or guest posts on others), reports, articles, videos, checklists and other helpful resources to address the information needs of customers and prospects. The goal is to become the go-to expert in the industry or target market which can lead to sales inquiries. These days, content is typically provided on the Internet (which makes clicking through to buy online easy!). However, offline content such as printed materials, public speaking or seminars can also be powerful alternatives to cold calling. The key to these materials, whether online or offline, is that they are NOT sales presentations or marketing brochures. A hybrid of content marketing and advertising, known as native advertising, is an emerging subset of content marketing. However, this must be done carefully. Click here to learn more about content marketing strategies.
  • Internet Advertising. Google AdWords and similar Internet advertising programs used to be inexpensive inbound marketing strategies to get in front of potential customers who were searching for solutions online. Lately, this has become more crowded and competitive, making it too expensive for many smaller businesses. However, it still represents a good value if keywords and placements are chosen carefully. Click here to learn more about Internet advertising.
  • Email Marketing. Regardless of what social media network is hot, people STILL read their email! The biggest challenge using it as a cold calling alternative is collecting email addresses. It should be opt-in, meaning that interested people voluntarily enter their email address to receive emails from a company. Providing an incentive to sign up such as a free ebook, report or discount can be effective. This makes email marketing a perfect partner to content marketing strategies. The free content lures them in; the email marketing keeps them in. Click here to learn how to choose an email marketing strategy.
  • Social Media. Social media networks are the new, virtual gathering places. Interestingly, many of the relationships built online move offline at events such as conferences, meetups and tweetups. Unfortunately, sales from social media can be slow in coming or even nonexistent. This requires that businesses seriously evaluate their time and labor investment in social media. The ultimate goal of these social activities should be to encourage interested people to join the company's email marketing list.

Disclaimer: The author/publisher has used best efforts in preparation of this article. No representations or warranties for its contents, either expressed or implied, are offered or allowed and all parties disclaim any implied warranties of merchantability or fitness for your particular purpose. The advice, strategies and recommendations presented herein may not be suitable for you, your situation or business. Consult with a professional adviser where and when appropriate. The author/publisher shall not be liable for any loss of profit or any other damages, including but not limited to special, incidental, consequential, or other damages. So by reading and using this information, you accept this risk.

© 2013 Heidi Thorne

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  • heidithorne profile image
    Author

    Heidi Thorne 4 years ago from Chicago Area

    Hello Everyone! I've just updated this post with new information on FCC TCPA regulations that went into effect October 16, 2013. Very interesting indeed! Check it out.

  • heidithorne profile image
    Author

    Heidi Thorne 4 years ago from Chicago Area

    Hey, Shawn, I remember those "dialing for dollars" days, too. Ack! How did we ever do it? Thank God for the new age of selling. Thanks for your support! Happy Weekend!

  • Shawn McIntyre profile image

    Shawn McIntyre 4 years ago from Orlando, FL.

    Ahh the good ol' days. I can remember being given a 50 page list of "prospects" to call, and making it through about the first five before I realized that they got them straight out of the phone book, lol.

    I was cleaning out my office not too long ago (read: looking for my cellphone), and found an old "script" from one of my first jobs. Just looking at it gave me autodialer flashbacks.

    Very interesting post, voted up.

  • heidithorne profile image
    Author

    Heidi Thorne 4 years ago from Chicago Area

    Thanks, Kathleen, for the additional input and clarification! Have a great weekend!

  • Kathleen Cochran profile image

    Kathleen Cochran 4 years ago from Atlanta, Georgia

    It doesn't apply to businesses that you already have a relationship with, not for profits, and politicians. But it does apply (in Georgia) to cold calls from businesses you have never dealt with before.

  • heidithorne profile image
    Author

    Heidi Thorne 4 years ago from Chicago Area

    Hello Kathleen! Thanks for adding the insight on the Do Not Call registry! It has certainly helped lots of people like yourself get their time back. Unfortunately, it doesn't apply for calls to businesses. :( Thanks so much for reading and commenting. Have a great weekend ahead!

  • Kathleen Cochran profile image

    Kathleen Cochran 4 years ago from Atlanta, Georgia

    I realize salespeople (I have been one) need to make a living. And some of them have products I do want to buy. But I have to say that the advent of the National No Call List has given me and my family our dinner hour back. It has been a welcomed relief no to get sales calls non-stop from 4 to 8 p.m. every night. When one does slip through, I ask the caller to please remove my number as we are on the No Call List.

    And buyer beware: If you do make a purchase on the phone, the three day cooling off law does not apply, which is amazing because it is just this kind of impulsive, high-pressure buying those kinds of laws were passed for.

    Great subject Well covered.