DMA Focus: DMA View on ... Call centres feel TPS pinch

call centre consultancy CM Insight.

Parallels are being drawn between the situation in the UK and the
meltdown of outbound telemarketing in the US after it launched the
National Do Not Call Registry. However, there are some important
differences.

The combined efforts of Ofcom, the Information Commissioners Office and
the Direct Marketing Association to tackle silent calls - the biggest
driver of TPS registrations - are significant. Brookmead Consulting
carried out research for the DMA earlier this year, which underlined how
big an issue this is for consumers. It revealed that silent calls caused
unacceptable inconvenience or anxiety to 53 per cent of the UK
population and people received an average of six calls a month.

Ofcom is investigating the practices of seven companies in response to
complaints from consumers about silent calls, while its investigation
into Kitchens Direct (which was found guilty of making 1.5 million
silent calls between November 2003 and February 2005) has reopened.

"We are anxious to see the results of Ofcom's investigations and hope it
will clarify the grounds on which it will act," says Tessa Kelly,
director of compliance operations at the DMA.

Meanwhile, the Association is championing telemarketing companies'
decision to introduce automated recorded messages, which reassure
recipients of silent calls by giving them the caller's details.

Last month, the DMA received clarification from the ICO that such
messages would not be in breach of the privacy and electronic
communications regulations if they simply identified the caller and did
not constitute a marketing message.

"We are not suggesting telemarketers can set their diallers high and
resolve the situation by running a recorded message," comments
Kelly.

"However, it would provide a useful clarification and go some way to
alleviating anxiety about silent calls."

Recent changes to the direct marketing Code of Practice have also helped
to tackle this. For example, all call centres - not just those that use
automated dialling equipment - now have to provide caller line
identification.

Also, customers should not be charged for dialling 1471 to identify a
business caller.

However, despite these efforts there is no escaping the fact that the
biggest perpetrators of nuisance calls fall outside the DMA membership
and the jurisdiction of the ICO and Ofcom. Calls that play recoded
messages alerting recipients that they have won a prize, for example,
are on the rise and are fuelling a high level of complaints. But many of
these calls originate from the US and are, therefore, impossible for the
UK authorities to police.

This can confuse members of the public who have registered with TPS to
stop this type of call. And, unfortunately, legitimate telemarketers can
be tarred with the same brush as unscrupulous operators. "The broader
issue is the gradual loss of consumer trust and confidence in our
industry," says Mike Havard, managing director of CM Insight.

He advises clients who are dependent on outbound calling to consider
using other methods. "Companies need a clear strategy about how to
reduce that dependency and make greater use of other channels, such as
the internet," says Havard.

Companies also need to get smarter about using inbound contact from DRTV
or press campaigns to solicit permission to make telephone contact. By
building their own opt-in database, the threat of rising TPS numbers can
be reduced.

It is perhaps premature to announce the demise of telemarketing but
companies would be well advised to experiment with other customer
acquisition channels while working as hard as possible to ensure all
outbound calls are targeted and welcome.

KEY FACTS

Just under a third of UK households with telephones have registered with
the TPS (according to Brookmead Consulting).

- On average, Britons receive six silent calls a month, rising to 7.3
for those aged over 65 (Brookmead Consulting).

- Fifty per cent of consumers have heard of the TPS - up from 41 per
cent in July last year (Mori).

- Of those people who had heard of the TPS, 55 per cent had registered.
Of those, 84 per cent were satisfied with the service (Mori).

- One million households have signed up to the free BT Privacy
service.

- The UK telemarketing industry sells goods and services worth £3bn every year (CM Insight).

- The DMA's code includes the mandatory delivery of caller line
identification, a 5 per cent ceiling for no-agent-available calls and
no-repeat calls within a 72-hour timeframe. DMA members represent
approximately 60 per cent of the UK's call centre industry.