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A $200 Million Dollar Telemarketing Mistake.

by kenmichaels
20 replies
BBC News - Discover to refund $200m to customers

---Snippet--
The investigation found "Discover's telemarketing scripts contained many
misrepresentations, implying that these products were free of charge and
simply 'added benefits'," CFPB director Richard Cordray told reporters.

Regulators also found in some cases that telemarketers had been paid
incentives to enroll customers in the add-on products, Mr Cordray added.

As part of the settlement, Discover agreed to change its telemarketing
approach and employ an independent auditor.

---End Snippet--


First ... to all you people who say large companies don't tele market..
I guess this proves you wrong .. eh?

Also, there is a lesson to be learned here. you cannot get
away with lying, misleading, or stretching the truth forever.

Also, one sentence, heck.. even one word in your script can
make what you say or do illegal.

Its YOUR responsibility to be compliant.

If you are planning on growing a real business, once
you get to the point of hiring reps, you should pay
a compliance officer to run through your script.

It will potentially save you a lot of time, money and aggravation.

A thing i never hear talked about here, is compliance...

for instance, i never hear any one saying things like

"upto"
"potential"

I hear the word guaranteed ... A LOT.

Did you know, in some states, for some products.

it is actually ILLEGAL to make ANY TYPE of guarantee?

Did you know some states cap the amount of a legal phone sale?

Did you know that if its illegal in California, and you call from
New York, you can be held accountable --- but not if you call from
Florida.

These are important things to know, and that is exactly what
compliance officers are payed to make you aware of.

forewarned is forearmed.


I just saw this article, and thought it would make interesting
discussion for all the phone sales people.
#$200 #dollar #million #mistake
  • Profile picture of the author abbot
    Banned
    Many make guarantees just to make a sale. Use your portfolio to your advantage. I have never guaranteed any client anything. I simply direct them to a real time case study. Show them what the POTENTIAL is. Not what they WILL RECEIVE. Using the word 'potential' is something everyone should get use to.

    "We will maximize your listing to it's potential" is something you CAN promise.
    "We will rank your site over your competition" is something you can NOT promise. (although i see it used in 6/10 scripts, if not more.

    I agree with you. Compliance will blow up in your face. Then bite you in the ass.

    Be careful what you GUARANTEE.
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  • Profile picture of the author MichaelHiles
    Interesting how, even in the big company setting, telemarketing is associated with a shady practice (again).

    Just sayin'.
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    • Profile picture of the author kenmichaels
      Originally Posted by MichaelHiles View Post

      Interesting how, even in the big company setting, telemarketing is associated with a shady practice (again).

      Just sayin'.
      I think a more truthful way of looking at it, is that ALL sales people
      are viewed the same way. Not just people who sell using a phone.

      Every type of business has a ( seedy underbelly )

      People are conditioned from birth to react negatively to sales people... not just telemarketers.
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      • Profile picture of the author MichaelHiles
        Originally Posted by kenmichaels View Post

        I think a more truthful way of looking at it, is that ALL sales people
        are viewed the same way. Not just people who sell using a phone.

        Every type of business has a ( seedy underbelly )

        People are conditioned from birth to react negatively to sales people... not just telemarketers.
        Actually, in the tech sector, sales has undertaken a renaissance the past few years.

        With the advent of tools like marketing automation, you only end up talking to a sales person after you've engaged and self-educated to the point where your qualification score dumps you into the active CRM pool and a rep will contact you. But you only get that level of contact after you're more likely to be purchase ready.

        So the benefit to then talking to an account rep is -- deals. Free stuff. Etc...

        A lot of them go to regional conferences with big bar tab budgets and the directive to have a great time with the clients.

        So what's not to like about them at this point?
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        • Profile picture of the author Claude Whitacre
          On a related note;
          The words "Up To" and "Potential" are nearly as bad as "Guaranteed".

          When you tell a client "You can make up to $1,000 a week". They hear it (and remember it) as you saying "You will make $1,000 a week"

          And the definition of "Up to" means Less Than.

          For example "You can make up to five sales a day" really means "You are guaranteed not to make more than 5 sales a day"

          I actually understand large telemarketing firms making these claims. A few more sales, a few more refunds and complaints...but more net income.

          But for us? Selling to prospects that we are building a relationship with?
          Weasel words aren't smart. They set up expectations that we don't expect to meet.

          A month ago I got a e-mail that said "Dan Kennedy (A marketing Guru) will be teaching us how to market" (Very abridged paraphrasing there)

          So the room was pretty full. The host was very satisfied with his marketing skill in filling the room to listen to him talk about Dan Kennedy.

          I didn't walk out. But it sure told me alot about the host.

          Profitable marketing is about Clarity, not dancing around the truth.

          Sorry, I just had a burr under my saddle.
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          • Profile picture of the author kenmichaels
            Originally Posted by Claude Whitacre View Post

            On a related note;
            The words "Up To" and "Potential" are nearly as bad as "Guaranteed".

            When you tell a client "You can make up to $1,000 a week". They hear it (and remember it) as you saying "You will make $1,000 a week"

            And the definition of "Up to" means Less Than.

            For example "You can make up to five sales a day" really means "You are guaranteed not to make more than 5 sales a day"

            I actually understand large telemarketing firms making these claims. A few more sales, a few more refunds and complaints...but more net income.

            But for us? Selling to prospects that we are building a relationship with?
            Weasel words aren't smart. They set up expectations that we don't expect to meet.

            A month ago I got a e-mail that said "Dan Kennedy (A marketing Guru) will be teaching us how to market" (Very abridged paraphrasing there)

            So the room was pretty full. The host was very satisfied with his marketing skill in filling the room to listen to him talk about Dan Kennedy.

            I didn't walk out. But it sure told me alot about the host.

            Profitable marketing is about Clarity, not dancing around the truth.

            Sorry, I just had a burr under my saddle.

            Now were having a discussion !

            I agree for the most part. However "potential" is a word i use a lot.

            for instance, when i talk about circulation. I know what that number is
            So i have to remind them they only have the potential to reach that number
            not everyone in that number is going to see it.

            ( obviously i am talking about advertising )

            And i totally agree. misleading, lying by omission or out right lying is just
            bull, and any one who sells that way is a twat.
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            • Profile picture of the author Claude Whitacre
              Originally Posted by kenmichaels View Post

              Now were having a discussion !

              I agree for the most part. However "potential" is a word i use a lot.

              for instance, when i talk about circulation. I know what that number is
              So i have to remind them they only have the potential to reach that number
              not everyone in that number is going to see it.

              ( obviously i am talking about advertising )

              And i totally agree. misleading, lying by omission or out right lying is just
              bull, and any one who sells that way is a twat.
              Ken; I know what you mean. When I used to buy newspaper ads, the rep would give me circulation figures that she only years later admitted that included virtually every newspaper printed (unbought in racks, laid out in bundles, sent as samples, mailed outside our area..) and she multiplied that number by either four or five. Maybe "admitted" is the wrong word. She never lied to me. I never thought of it as that.

              I keep rolling that word "Potential" around in my mind. I see what you mean. It never conveys the idea that you are promised this amount.
              And it is a powerful word in copywriting.

              I want you to know I'm not talking about the morality of using certain words in selling. I've just learned after a few decades of selling that being clear is to my benefit.

              A friend of mine in MLM (something I've sworn off..like kissing toads) told me that you made far more sales by underselling than overselling. I think I know why. Underselling sounds more real to the listener. It conveys a kind of confidence.

              Anyway, this thread started off about the law.

              Here are a few things that just crack me up;
              "Made with 100% real fruit juice". The key word is "with". So maybe 10% of the drink is 100% fruit juice. The rest water and sugar.
              "Chocolaty" means No chocolate was used at all.
              "99% soy free". That sounds like only 1% has any soy at all. But it really means that a full 1% could be concentrated soy.

              If someone shot me with a pistol, I'd still be "99.994% lead free"

              By the way...Thanks Ken! My wife walked by as I was reading your post. I just spent the last 30 seconds explaining what "twat" means.

              I just spent the last 10 minutes thinking up brilliant commercial weasel words...and THAT is what caught her eye.

              I once convinced my wife to call our new dog Dildo. Everyone knew what it meant but her. Friends, relatives, everyone. Except her. She is so very proper, she still doesn't know it was a joke. One day she told me that the dog ran out of the house, and she had to call for it for several minutes.
              I admit...THAT possibility never occured to me. Sorry for the side track.
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              • Profile picture of the author kenmichaels
                Originally Posted by Claude Whitacre View Post

                A friend of mine in MLM (something I've sworn off..like kissing toads) told me that you made far more sales by underselling than overselling. I think I know why. Underselling sounds more real to the listener. It conveys a kind of confidence.
                That is beyond profound, and in my experience it has been absolutely true.

                I do it myself, and have always referred to it as "bringing them back to reality"

                I show people the path, and allow them to sell them selves.

                Unfortunately one of the downsides, is that when they do
                sell them selves... some times their expectations are way .. way
                out there ... so i have to slap them with reality.

                A side benefit of saying.. whoa .. slow down... your
                not going to make a bazillion dollars or become the next
                shipping conglomerate.....

                is that your trust / credibility factor shoots through the roof.

                btw, your dog story .... 2 funny man. 2 funny.
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                • Profile picture of the author kirbymarketingconcierge
                  Hi Ken,

                  good post for dialogue and paving our way.



                  good article ??? :

                  Lawyers get rich off consumer bureau

                  The CFPB said its goal is to protect consumers from unfair practices, but it also wants to support honest businesses.

                  Lawyers get rich off consumer bureau - Yahoo! Finance
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                  • Profile picture of the author kenmichaels
                    Originally Posted by kirbymarketingconcierge View Post

                    Hi Ken,

                    good post for dialogue and paving our way.



                    good article ??? :

                    Lawyers get rich off consumer bureau

                    The CFPB said its goal is to protect consumers from unfair practices, but it also wants to support honest businesses.

                    Lawyers get rich off consumer bureau - Yahoo! Finance
                    That was an interesting read, thanks for posting that.

                    I find it off the wall bonkers they fined capital one for "pressure"

                    Pressure is NOT illegal, and if that is how they are going to
                    be running things, i don't think they will be an authority for
                    long... especially if these turn into litigation, and there judgments
                    are found unlawful.

                    And the next part... even worse. if a 3rd party does some thing wrong
                    the hiring company is responsible... WTF !

                    that cannot be legal.
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    • Profile picture of the author John Durham
      Originally Posted by MichaelHiles View Post

      Interesting how, even in the big company setting, telemarketing is associated with a shady practice (again).

      Just sayin'.
      This thread was like a birthday present to Hiles Ken...

      As a matter of fact; Its kinda seedy to opt someone into a free email list with secret plans of selling the holy crap out of them...

      Or opting them into a       "funneling system" unbeknownst to them, could be considered seedy and deceitful.

      Originally Posted by MichaelHiles View Post


      With the advent of tools like marketing automation, you only end up talking to a sales person after you've engaged and self-educated to the point where your qualification score dumps you into the active CRM pool and a rep will contact you. But you only get that level of contact after you're more likely to be purchase ready.

      So the benefit to then talking to an account rep is -- deals. Free stuff. Etc...

      "Oh I forgot to tell you, we just invited, and gave you free stuff... so you could be dumped into another list and funneled, its not really out of the kindness of our hearts like we said. but hey you dont mind a little funneling action do you?"

      "Ooops, sorry if we failed to mention the funneling part....just kinda slid you in there, since you are more qualified to be sold now and all... Buttering you up like a Christmas turkey? Us? Never... Dont worry, bend over, getting funneled doesnt hurt a bit I promise."

      Scraping peoples FREE public financial information from google to organize exploit it in a call list, and SELL it is kinda seedy too... :rolleyes: ... if ya think about it.

      I find it so interesting how selective we are about what is seedy.

      Especially people who have no problem promoting call list generators, but have issues with cold calling.

      Sigh....

      On another note: Re; "Upselling"

      Anyone got a moral issue with that? I believe upselling was mentioned.

      Anyone ever tell you that its kinda seedy?

      "Here's everything you need....Pssst, dont worry we will upsell you the real EXPENSIVE stuff later, now that you are in our funnel, and you are a more qualified prospect fer it an all... Now, dont think Im not sincere, I really did mean the free stuff.... its just that you are so sellable now that yer all excited... Gullible? Now cmon, I didnt say that did I?"

      "I didnt mean to funnel you, honest, its just that I wanted to sell you something, and you needed to be buttered up a little first....you understand."

      Funneling is more ethical positioning than cold calling and just outright saying what you want... :rolleyes:

      Along that same line...:

      Loss leaders have a seedy element. Offering free quotes with no obligation and an intent of selling for that matter could be considered seedy, but its a common practice in a gazillion industries.

      No matter how happy it makes some to see the seedy side of telemarketing pointed out, its still the quickest no brainer way to get your first offline sale, and you dont have to be seedy at all to do it, just committed enough to sit down for a few hours and focus, and ask people if they want your service.

      The day people stop telemarketing around here is the day you start seeing only 20% of the success reports (If That).

      Dont believe me? Try some of the "non seedy" ways people offer around here...I'll see you in six months when you still dont have a sale.

      My advice newbies: "Cold call".

      Millions of people succeed with cold calling daily, while one in a million succeed with most other methods.

      "But Google adwords and squeeze pages are better! So is direct mail!"

      Really?

      And you are suddenly going to become a keyword expert and a professional ad copy writer over night?

      Good luck- sincerely. Let me know how that goes for ya!

      On another note, selling under a pen name might be considered shady as well...but people do it here all the time, and dont even flinch about it. I personally dont, but up until very recently I have always felt that was kind of "twatty" and not cool.

      However I can see how it helps people outlive failures and the like... Personally I will outlive mine the hard way, though I dont blame others for using pen names, especially on the internet... For me, it just seems more honest to use your real one, taking the credit for your victories, and also the blame for your failures like a man.

      So many ASPECTS of even honest things seem shady... Anyone who manipulates in any way in marketing is being slightly shady...Who is going to cast THAT stone?

      An email series that plants seeds for three weeks, intentionally and DELIBERATELY leading up to the selling of a product is manipulation... Maybe we should all quit marketing.

      Again, we are very selective as to what we judge.

      In closing,

      Wanna fail for months on end? Easy: Buy some fancy system instead of cold calling!



      Oh! It was a fun post. Yes it was.

      ...and what we reveal about ourselves in pointing fingers is amazing.

      But then, who am I other than a dumb hillbilly with no marketing degree?

      Oh yeah, just the guy whose marketing advice has made more people money than any other single person in the offline forum... I forgot.

      It aint braggin if its true!

      Trying to back off and give the funnelers a year or two to catch up though....Please speed it up guys...... What are yall doing "conglomerating"?

      I see. Sigh...Well..., let me know when some newbies make money... We'll be seein ya!
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      • Profile picture of the author Mwind076
        Originally Posted by John Durham View Post

        I personally dont, but up until very recently I have always felt that was kind of "twatty" and not cool.

        Wanna fail for months on end? Easy: Buy some fancy system instead of cold calling!



        Oh! It was a fun post. Yes it was.

        ...and what we reveal about ourselves in pointing fingers is amazing.
        You said twatty...that's my word. I think I love you. It's taken almost 2 years, but I'm there now.

        Also, I've been accused (just this weekend) of being "rude" on here when stating my view or standing up for myself on here. I'm kinda fed up with those that point fingers in a 2 line post without actually giving any real advice or help in a thread. So, if I'm considered rude, they probably deserved it.
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        • Profile picture of the author John Durham
          Originally Posted by Mwind076 View Post

          You said twatty...that's my word. I think I love you. It's taken almost 2 years, but I'm there now.

          Also, I've been accused (just this weekend) of being "rude" on here when stating my view or standing up for myself on here. I'm kinda fed up with those that point fingers in a 2 line post without actually giving any real advice or help in a thread. So, if I'm considered rude, they probably deserved it.
          Same back atcha! Isnt it funny that the people you struggle with most are often your favorite people later on? Lol.
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          • Profile picture of the author Mwind076
            Originally Posted by John Durham View Post

            Same back atcha! Isnt it funny that the people you struggle with most are often your favorite people later on? Lol.
            That's something I tell my teenager. The people I didn't like most at first, are now some of my closest friends. I think it has something to do with feeling that someone is stepping on toes, even if they have good ideas, you tend to pick on the ones you don't agree with.

            My ex is still not a fav. I don't see that happening. LOL
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            • Profile picture of the author John Durham
              @ Mwind

              Im glad you dont love Ken yet, that means I can still feel special for awhile. lol He can wait his turn!
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        • Profile picture of the author kenmichaels
          Originally Posted by Mwind076 View Post

          You said twatty...that's my word. I think I love you. It's taken almost 2 years, but I'm there now.

          Also, I've been accused (just this weekend) of being "rude" on here when stating my view or standing up for myself on here. I'm kinda fed up with those that point fingers in a 2 line post without actually giving any real advice or help in a thread. So, if I'm considered rude, they probably deserved it.
          in post 6 i said "twat" does that mean i am half way there ?

          or since its missing the "ty" its to vulgar ?
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          • Profile picture of the author Mwind076
            Originally Posted by kenmichaels View Post

            in post 6 i said "twat" does that mean i am half way there ?

            or since its missing the "ty" its to vulgar ?
            Twat has a certain "bad connotation" - when you add the TY and make it an adjective it becomes ok. As in, you're not really calling someone a twat, just saying they are showing signs. It's more passive aggressive and socially acceptable. It's the same as calling someone a B and saying someone is bitchy.

            You are also a favorite, but I don't love you yet. Look at it as a challenge! I'm kidding.
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  • Profile picture of the author vndnbrgj
    Ken, is there some palce I can learn more about compliance laws?
    I had no idea about the sales caps.

    I use "Starts at..." in my pricing.
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    • Profile picture of the author kenmichaels
      Originally Posted by vndnbrgj View Post

      Ken, is there some palce I can learn more about compliance laws?
      I had no idea about the sales caps.

      I use "Starts at..." in my pricing.
      Here this is a good basic starting point.

      Complying with the Telemarketing Sales Rule | BCP Business Center

      Each state has there own laws, and laws concerning sales across borders.
      And then You have the Fed and FCC rules and Regs on top of that.

      I would not trust the internet at all for information pertaining to compliance
      its too damn important.

      Best bet, is find a compliance attorney. They will have compliance officers
      that you can hire for a few hours, days , weeks , months..
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  • Profile picture of the author Michael Ten
    Wow. That is a lot of money. Dishonesty is a bad strategy.
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