BUSN20016: Marketing - Research In Business - Telemarketing - CQU Assessment Answer

Marketing Assignment

Assignment Task

SECTION I

Introduction

Telemarketing is a direct marketing concept that involves soliciting for product or service sales over the phone or similar medium. It is a marketing approach that has existed for several decades and transformed significantly with new technological developments. Today, women are still a central component of telemarketing as it has been with tradition. Telemarketing can involve either another business, in what is referred to as business-to-business telemarketing, or a consumer. As with any other direct marketing approach, it is less costly, but more efficient if the resultant impact per audience is considered (Shani and Chalasani 2013, p. 45). Telemarketing has many advantages, particularly, the ability to receive a direct response from the customer. It also offers flexibility to the company and the staff as well, which may increase productivity (Kumar 2015, p. 8). However, it has its limitations likewise. Telemarketing can only be applied to particular businesses such as those characterised by high transaction values of sales. In businesses such as FMCGs, the size of the target market may be too wide to apply telemarketing effectively. This project proposal seeks to establish the use of telemarketing, its effectiveness and limitations.

Telemarketing attracts a lot of criticism due to its aggressive nature of persuasion. Some organisations that practice telemarketing have gone beyond socially acceptable limits of aggression such as to become a nuisance to consumers. Some commentators have referred to telemarketing as an unethical marketing approach (Diaz Fondeur 2013, p. 8). It has also been faced with numerous other challenges in the past, such as pyramid scheme scams and fraud. Customers' telephone services have occasionally been switched without their authorisation by rogue telemarketers (Ohlhausen 2014). All these factors have given telemarketing a bad name and it is perhaps the reason many organisations are yet to consider using this channel to sell their services and products.

Statement of the problem

Marketing inefficiency leads to unfulfilled marketing objectives and wastage of marketing resources. Experts recommend spending between 7 and 8% of gross profits on marketing alone (Sba.gov, 2016). This can be a huge limitation for many businesses as it can be too little to satisfy marketing objectives for certain businesses. Moreover, some businesses have segmented consumer bases where regular marketing approaches may prove to be ineffective. Organisations such as insurance companies and investment banks may also need to develop personal relationships with their consumers. In such cases, therefore, telemarketing becomes a critical communication tool. It must be acknowledged that marketing is one of the most crucial functions of a business enterprise. After a company produces goods and services that address the consumers' needs, the business must build the bridge to get information to the potential consumer.

Besides inefficiency, marketing is rapidly evolving owing to social and technological developments. Consumer reactions to marketing campaigns are increasingly becoming influenced by psychosocial developments. Consumers are likely to show increased sensitivity to annoying marketing campaigns that before (Goldstein et al. 2014, p. 101). There is an increasing need for businesses to become efficient in their operations, precisely in marketing operations. One such development is referred to as robotic telemarketing where systems are pre-programmed to pass communications to consumers. So far, robotic telemarketing has not been successful regarding the impact of communication it creates.

From these problems, it is clear that there is a need to research on the use, effectiveness and limitations of telemarketing. The proposal will address all the three components of the problem; that is, the use, potential latent advantages and current challenges of telemarketing.

Research aim and objectives

The aim of this research is to establish the use, effectiveness, and current challenges of telemarketing. This aim will resolve questions such as the ethical concerns associated with telemarketing and why some businesses have not yet considered this marketing channel to sell their goods and services. The specific objectives of the research are:

• To find out how organisations conduct telemarketing
• To find out the actual response of consumers to telemarketing communication
• To establish the perceived efficiency of the approach from the marketers’ point of view
• To establish the perceived efficiency of the approach from the consumers’ point of view
• To evaluate the ethical concerns associated with telemarketing
• To make a conclusion on the effectiveness, limitations and ethical concerns of telemarketing.

Research questions

These research questions have been formulated to guide the research through a specific scope to guarantee that the objectives of the research will be met. The proposed research questions are:

RQ1: Is telemarketing an effective marketing approach concerning the communication impact created on the consumer?

RQ2: Are the ethical concerns regarding telemarketing valid?

RQ3: Do consumers prefer telemarketing communications to other forms of marketing?

RQ4: Why do marketers who use telemarketing prefer the approach to other techniques?

Scope of the research

This research will comprehensively address the current use of telemarketing, including strategies that companies employ. The research will also be limited to business-to-consumer telemarketing. The business-to-business subcategory of telemarketing will not be specifically addressed in this research. The research will not address robotic telemarketing in any way. References to success, ethical concerns and failures will only be to traditional telemarketing.

Justification

As already mentioned, telemarketing is an approach with a high potential of creating communication impact due to its direct-contact nature. However, there are many challenges facing the approach such as ethical concerns that make the approach seem an inappropriate marketing tool. Moreover, telemarketing cannot be applied universally regardless of the nature of the organisation (Tan, Liew and Yeoh 2014, p. 233). Therefore, there is a need to address these concerns through an empirical research that will establish, analyse and evaluate them against certain objectives. Also, there are many companies that are running on low budgets and would be interested in exploring this possibility, perhaps if the related concerns are addressed. Precisely, the following advantages may be realised from the research and thus justify conducting it.

• Businesses that currently employ telemarketing will not only know where they go wrong, but also how they can correct.
• Companies that may be considering the use of telemarketing to increase the impact of their communications can do so by following recommendations of the research.
• Underlying telemarketing concepts are universal. Therefore, the findings of the research can be implemented in any part of the world.
• Possible solutions to the ethical concerns regarding telemarketing may be formulated from the research, hence, effectively addressing the issue among consumers.
• Other researchers may find useful information to incorporate into their

Potential output of the research

This research may lead to two outputs depending on the results that will be established. The research can end with solid findings containing conclusive recommendations. It can end with inconclusive findings. Therefore the two potential outputs of the research are an actionable recommendation set or a basis for further research in the same field. Both results are acceptable endings for an empirical study such as this one. The potential output will largely be determined by the interpretation of the data collected. If the collected data can positively answer the research questions formulated above, the output will be the conclusive set of recommendations. On the other hand, if the research is not able to positively answer all the research questions, then the findings may be useful for the development of future researchers.

SECTION II

Conceptual framework

Telemarketing has three basic components: a database of potential consumers, a customised marketing message and a specific call to action. A company wishing to employ telemarketing must first collect information about potential clients. Information collected is usually very comprehensive because the marketing messages sent out are normally very specific to that client. Such information may include the potential customer’s telephone number, email address, physical location as well as personal preferences. This information should be obtained with the consent of the consumer, although this does not always happen. Other non-personal information may be collected from third parties, although non-personal information may not be of much importance to telemarketers (Luke 2015, p. 67).

The second component of the technique involves composing unique messages to be distributed to the potential consumer. Messages are usually characterised by specificity, to the consumer receiving it. Telemarketing is an approach that bases its success on appeal to a targeted client. Therefore, a narrower target focus is always preferable.

The third feature of a telemarketing technique is a call to action in every communication passed to a consumer. Unlike other forms of marketing that may seek to achieve various objectives such as strengthening the brand, telemarketing primarily seeks to drive sales. Therefore, the message will prominently direct the respondent to take the next step such as visit the marketer’s store or website.

Fig 1: An illustration of the conceptual framework of telemarketing

From this nature of telemarketing, some issues are already evident. The process of collecting consumers’ personal information is the first major issue. In a world where people value privacy, sometimes even more than security, not many of them will be comfortable to have some company know them too much (Stathopoulou and Balabanis 2016, p. 894). As such, a difficult balance between collecting consumers’ information and not annoying them develops. If too few or only non-personal information is collected, telemarketing will become ineffective.

The specific nature of messages communicated through telemarketing is susceptible to abuse by marketers. Because it is known to marketers that the targeted consumer is very likely to act upon the message, some marketers have been accused of misusing this feature to intentionally deceive consumers.

The call to action is usually aimed at ensuring that the potential buyer takes the next step. Thus, it is not uncommon to find marketers applying undue pressure to consumers to implement the call to action. This practice is, debatably, considered unethical by some commentators. It is debatable because marketers argue that the whole point of marketing is convincing the consumer on some information. Some users have also developed a negative attitude towards the mode of persuasion that marketers use, particularly over telephone calls (Jones et al. 2015, p. 188).

Research hypothesis

H0: Telemarketing is not an effective marketing approach given the many challenges it faces.

H0: Telemarketing is an effective marketing approach despite the many challenges it faces.

Methodology

Various tools will be used individually and in combination to gather adequate and quality data to build the study. The quality of the data to be collected, that is, completeness and relevance of the data will be taken into close consideration. To test the hypothesis and answer the research questions, the following approach will be used:

Literature review

Published literature on the topic will be reviewed to evaluate the findings of other researchers which will guide this research through a more successful path. Published literature on the subject will be a very valuable source of information for the research. It will simplify the process of information gathering by eliminating the need to collect data on already established findings (Wolfswinkel, Furtmueller and Wilderom 2013, p. 44). The selected literature will have to be relevant in answering the research questions.

Data collection

Data regarding the various research questions raised will be collected. This data will include information about the different approaches companies take on implementing telemarketing. It may be difficult to get data on actual processes that companies employ. However, the general approach taken will be sought. Data on consumers will also be necessary. Consumers who have experienced telemarketing will give their opinions on the overall experience and perceived effectiveness. Various tools will be used to collect data for the study. Among the tools to be included are:

Surveys: Surveys are some of the quickest way of obtaining accurate information. They may be conducted both online and in person. The main purpose of surveys in this study will be to determine the opinions of various consumers towards telemarketing. Surveys will collect both facts and opinions from consumers.

Questionnaires: Questionnaires will be issued to consumers as well. Their main purpose will be to collect factual information on telemarketing. Unlike the survey, questionnaires issued will not collect the opinion of consumers. Their design will only allow facts to be received.

Data analysis

This research will be based on a lot of qualitative data, such as opinions collected from the surveys. As such, a qualitative data analysis approach will be employed when analysing the data. Nonetheless, there will be a considerable volume of quantitative data collected from the study. For instance, the number of respondents who chose a certain response will be populated. Therefore, quantitative techniques will equally be required to complete the analysis. Qualitative analysis of data will be approached by the disaggregation of essential responses into axial codes. The credibility of the findings is an important aspect of this research and, as such, interpretation of the qualitative data will be done rigorously.

SECTION III

Organisation of the study

• The first chapter of the research will be composed of this proposal. It contains the plan for the study. It includes the problem, hypothesis, data collection plan and expected results.

• The second chapter will review the literature available on the subject. This will be a thematic appraisal of the works of other authors who have contributed to the subject. This section will end with a summary conclusion of the main ideas obtained from the literature.

• The third chapter will focus on the data collection process. Methods used will be described here in detail. This section will end by briefly reporting the raw results obtained from each data collection tool.

1. The fourth chapter will re-report the results in detail and analyse them. Comparison of results and their validation will be done at this stage.
2. Chapter five of the study will answer the research questions by providing a summary of the results of the analysis and relating them to the context of the research questions. Recommendations based on the research findings will be formulated in this section.

Gantt chart

The entire research is expected to last for a total of 35 days, including weekends and holidays, if any will fall within the project’s schedule. The duration includes days spent in the development of the proposal.

Project budget

Most of the budget allocations will go into the purchase of publications to the literature review section. The literature review is regarded as a crucial element of this research, and therefore all necessary material must be obtained from this process. Other costs will be distributed into data collection, printing of materials and contingencies as shown below.