Should payment processors stop cold-calling?

According to the Keller Research Center at Baylor University, only 1% of cold-calls result in an actual meeting.

Please note: The following numbers were compiled using historical data from credit card processing companies. At this time, we are lacking industry specific data and research to support these claims on a national scale.

That being said, we believe most industry leaders can relate to these numbers.

Let's consider the following:

• The average telemarketer in the United States makes an annual income of $22,740.
• 8-10am and 2-4pm are considered "prime" cold-calling hours to reach local businesses
• telemarketers working 4 hours per day make 150 phone calls
• 150 phone calls should yield an average of 1.5 appointments per day
• 25% of all appointments are considered qualified appointments
• close ratios approximately 35%
• average sales cycle 4 weeks
• average merchant account $1,000

Based on the above figures, your appointment setter should yield the following:

• 390 appointments per year
• 97.5 qualified appointments
• 34.1 closed appointments = $34,100 in annualized revenue

To take things further, we all know there are additional costs with hiring appointment setters. To make things easy, let's assume you pay as you go using a system like CallFire. For $0.05 per minute, ISO's should anticipate paying $3,120 per year. In addition, they will have to buy their leads list. We estimate an ISO will spend an additional $250 per month or $3,000 per year on acquiring their leads list.

Finally, that brings us to a grand finale of $28,860 in total cost associated with one appointment setter.

Revenue - Cost >> $34,100 - $28,860 = $5,240

The moral of the story, the ROI on appointment setters is becoming increasingly more difficult as statistics continue to show diminished returns. Luckily for payment processors, they collect residual income off the accounts they board. As for other industries, the returns may be even worse.

The question is, why? Is it just cold-calling or is it all outbound marketing? What is outbound marketing?

Outbound Marketing Approaches:

• cold-calling (200MM on do not call list)
• TV ads (86% skip television adds)
• unsolicited emails (91% unsubscribe)
• direct mailers (44% do not open)

While all of these outbound practices share poor returns, they actually share something even more disturbing. None of these approaches understand modern consumers.

When was the last time you were watching your favorite television show only to be interrupted by the same annoying commercial? It's frustrating. In the modern era, people will not tolerate the cold and frankly annoying pitch they've heard over and over again.

ISO's and sales organizations must align themselves with the modern consumer and understand their buyer personas in order to achieve long-term success.

The first step is understanding that the marketing landscape has changed. If you want to attract customers, they need to find you.

Let's consider these Inbound Marketing Approaches:

• Search engine optimization
• Content marketing (eBooks, Infographics, Case Studies, etc.)
• Social Media
• Email nurturing
• Blogging

All of the above inbound examples bring about a fundamental change to how you are approaching your customers. Stop attacking and start attracting.

Here are some mind-blowing inbound marketing statistics to consider for your 2017 marketing budget:

According to Search Engine Journal, inbound leads cost 60% less than outbound leads.

According to Social Media B2B, B2B companies that blog generate 67% more leads per month than those that don’t

The Content Marketing Institute reports that 8 out of 10 people identify themselves as blog readers, and 23% of all time spent online is spent on social media sites.

So, the question remains, Should payment processors stop cold-calling? We'll leave that one up to you.

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