Oregon Paper Hangs Up on Telemarketing

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By: Lucia Moses

With the creation of a national “Do Not Call” registry just months away, one might think there isn’t a circulator around who’s not scrambling to figure out how to comply with the coming telemarketing-sales restrictions.

But, in fact, there is at least one. Nonsubscribers in Medford, Ore., haven’t gotten a telemarketing call from the Mail Tribune since Circulation Director Mike Miller hung up the phone for good three years ago.

While telemarketing generates close to 60% of new solicited starts industrywide, the 28,139-daily-circulation Mail Tribune relied on it even more: Nearly 100% of such starts were coming from telemarketing when Miller arrived in 1998. Retention was terrible, and only a third of new customers who went for the pitch paid for their orders.

“I will say, 100%, it produces a lot of orders,” Miller said. But, he added: “I hate it. I have just never wanted to associate my brand with that kind of marketing.”

With the support of Publisher James Grady Singletary, Miller stopped using a telemarketing program run by parent Ottaway Newspapers Inc. and replaced it largely with door-to-door crews and, to a lesser extent, kiosks at malls and well-trafficked stores. He still uses the phone, but only at renewal time.

Other changes encouraged people to subscribe. Miller instituted porch delivery within Medford’s city limits. He began a pay-for-performance system for district managers and got tougher on carrier complaints.

Collectively, these changes helped reduce the churn rate to about 31% last year from 42% in 1999, while the rate of subscriber renewal rose to 89% last year from 86% in 2001, when the paper started measuring it, Miller said. From September 1998 to September 2002, circulation rose 1.23% from Monday to Thursday and Saturday, 1.48% on Friday, and 0.92% on Sunday — despite an increase in the home-delivery price each year. Miller said his cost per order did rise about 47%, to $22, but the better-quality orders made the changes financially rewarding.

The latest in a long line of antitelemarketing initiatives, the Federal Trade Commission’s new rules would prohibit businesses from making interstate telemarketing calls to people on the national “Do Not Call” list, except for existing customers. Violators could be fined as much as $11,000 a call. The FTC also is considering a national registry for in-state telemarketing calls.

Newspapers may not know, however, that the rules also require them to start sending written confirmation to subscribers who sign up for auto-pay plans and cut their number of abandoned calls, those resulting in dead air between the time a call is picked up and a telemarketer speaks, said John Murray, vice president of circulation marketing for the Newspaper Association of America.

Such antitelemarketing measures, as well as an interest in retention, have pushed the industry toward other acquisition methods, including door crews. Door crews form the cornerstone of Miller’s strategy in Medford. Bands of kids knock on doors weekends and early evenings, offering coupons and gift cards to anyone who will pay in advance for three months or more.

Miller stressed the importance of understanding the challenges crewers face on the job, such as rejection. Unlike telemarketing, door crews aren’t considered too intrusive. “Because of that,” Miller said, “it doesn’t have resistance.”

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