What is 'Telemarketing'

Telemarketing is the direct marketing of goods or services to potential customers over the telephone, internet or fax. Telemarketing may either by carried out by telemarketers, or increasingly, by automated telephone calls or "robocalls." The intrusive nature of telemarketing, as well as reports of scams and fraud perpetrated over the telephone, has spurred a growing backlash against this direct marketing practice. Telemarketing may also be referred to as "telesales" or "inside sales."

Breaking Down 'Telemarketing'

Telemarketing involves the practice of contacting, vetting and approaching potential customers. It does not include the use of direct mail marketing methods. The term saw its first used in the 1970s with the advent of a new, cheaper class of outbound long distance telephone services and inbound toll-free services. The practice of telemarketing take may take place from a call center, an office, or, increasingly, a home. It can involve a single call to assess interest or suitability and then follow-on calls to pursue a sale. Various data may be used to narrow down large databases of names to a small number of higher-probability customer prospects. Telemarketing is used by for-profit businesses, non-profit charities, political groups and candidates, surveying, donation solicitation, marketing research and more.

Telemarketing Activities

The act of telemarketing can divided into four subcategories:

  • Outbound: Customer prospects and existing customers are actively reached out to.
  • Inbound: Based on inbound inquiries about products or services as prompted by advertising or sales efforts.
  • Lead generation: The collection of intelligence about the profiles, interest and demographic data of potential customers.
  • Sales: The persuasive activity engaged in by salespeople.

Telemarketing may entail a variety of activities, such as surveying, appointment-setting, telesales, database maintenance and cleaning, and providing a call to action.

Telemarketing Reception

The United States and Canada have national "Do Not Call" (DNC) registries that give their residents a choice about whether to receive telemarketing calls at home. In the U.S., the registry is managed by the Federal Trade Commission (FTC) and enforced by the FTC, Federal Communications Commission and state law enforcement officials.

Consumers who are registered in the DNC database can file a complaint if they receive a call from a telemarketer, which could lead to a stiff fine and sanctions for the telemarketing firm. However, calls from charities, political organizations and telephone surveyors are permitted and threfore may be received by a consumer despite having their number listed on the DNC registry. Also permitted are calls from businesses with whom the consumer has an existing relationship, as well as those businesses where consent to call has been provided in writing.

Numerous North American companies outsource their telemarketing functions to lower cost jurisdictions such as India, Mexico and the Philippines.

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