Has GDPR killed off the cold call?

As GDPR catches its first major rule breaker, CRN takes stock of how it will affect sales strategies in the channel

The introduction of GDPR was one of the biggest talking points of last year, with businesses re-evaluating the manner in which they hold and process customer data in order to avoid falling foul of the regulation.

Eight months on, and Google has become the first big-name casualty of GDPR, being slapped with a €50m (£44m) fine by French regulatory authority the CNIL.

The CNIL stated that Google made it difficult for users to access the information it had stored on them, and was not transparent in how it processed user data for ad personalisation.

However, the internet giant has come out swinging against the penalty and plans to appeal it, arguing that it "worked hard" to ensure that its processes were GDPR compliant and as transparent as possible.

"We're also concerned about the impact of this ruling on publishers, original content creators and tech companies in Europe and beyond," it said. "For all these reasons, we have now decided to appeal."

GDPR's introduction presented a lot of challenges to sales and marketing teams across the channel, with some experts believing that there would be a return to the old ways of marketing, such as snail mail and cold calling. Others predicted that social media tactics would dominate the landscape.

So with its first major fine and nearly a year in force, how has GDPR affected the sales landscape?

The old way

A post on Linked In by Jon Feldman, VP at governance software provider ACL, chastised those who claimed that the art of cold calling was a relic of a bygone era.

Though the post is two years old, it continues to cause a stir and attract streams of comments.

Of the 4,000 comments so far, there is a clear split between those who agree with Feldman's point, and those who effusively do not.

"Real sales professionals take matters into their own hands and use cold calling as an effective tool," he wrote, causing a frenzied debate in the comments section.

"Cold calling is dead in a sense. Now, it's transferring to connecting with clients through social media because many people have caller ID and will not answer if they do not recognise the phone number," wrote one contributor.

"Make a warm call! Keep it relevant with a personal touch," another wrote.

David Leyland, director of solutions at Bell Integration, was one who waded into the debate, proclaiming cold calling to be "useless".

He clarified to CRN that he was referring to cold calling as ringing through a list of random numbers, whether they are a relevant prospect or not.

Leyland believes the effects of cold-calling by a slew of companies and industries has led to a general fatigue from people towards the technique, if not outright hostility.

"Nowadays technology makes it so easy to avoid them that people expect, and deserve, a more sophisticated and customised approach to sales," he explained.

"The hit rate when I started 30 years ago was astonishingly low, and I think those days of cold calling are behind us.

"While the telephone is still an important means of communication, what is the legitimacy and purpose of cold calling, particularly in a post-GDPR world?"

Bell Integration uses social media and face-to-face meetings to speak to new customers, according to Leyland, and these methods have proved successful for the VAR, though he admits he doesn't know how it "stacks up" statistically.

"We tend to focus on targeted social media that explains a component part of our offering and if it is relevant, people tend to respond," he explained.

"We don't have hordes of people sitting at desks banging it out on phones - that's not our style. We work with networks and shows and meeting people there.

"I don't know how successful it is if you're in a business selling a commodity such as insurance, but when it is a professional services business, I would consider a cold call to be bordering on useless."

Comments on Feldman's LinkedIn post appear to back up Leyland's stance, with one commenter stating that "It's the social media age now. People are stuck in the past."

If it ain't broke…

Some in the channel, however, wholeheartedly refute the idea that the tried-and-tested tricks of the trade are falling out of favour.

Jonathan Lassman, MD of Epaton, is a staunch advocate of cold calling, claiming that it has a 95 per cent hit rate in his company compared to other sales and marketing methods it uses.

"Salespeople who are looking for excuses say cold calling is dead," he declared.

"Sales 101 hasn't changed. We know the demographic we are after and we know the types of organisations that we want to be involved with."

SEO marketing and social media are all well and good, according to Lassman, but they don't provide a concrete figure for the return on investment (ROI) that the "old-fashioned way" does.

"With cold calling I know what my ROI is; it is specific marketing and I am getting to the people I want to get to," he stated.

"Don't get me wrong, out of 100 calls, you may reach three people, but those three are the right calibre of customer that you want to be talking to, whereas with SEO you can't be that specific."

The future of sales

Leyland and Lassman are unworried about the effects Google's GDPR fine will have on how the channel approaches sales and marketing, though Lassman said he has noticed an increased wariness among some firms to directly contact prospects.

"I see a lot of the competition hiding behind SEO marketing, email shots, social media and not doing the traditional methods," he said.

Glenn Robertson, MD of Pure Channels, a marketing agency that works primarily with vendors, said although GDPR has considerably heightened perceptions and understanding of data processing, he has not seen any fallout in the channel from Google's gargantuan penalty.

He suspects this is due to the fact that it is Google being fined, and many perhaps expected it to fall foul of the regulation based on the sheer volume of data it processes.

Robertson falls between the Lassman and Leyland camps.

He agrees cold calling is still an important and effective way to reach prospective customers, but thinks it should be done as part of a co-ordinated campaign, involving social media and other platforms.

Neither cold calling nor social media alone should be relied on as a main lead generator, he added.

Robertson agrees with Leyland's assertion that face to face is one of the most important aspects of dealing with clients and is vital to building rapport with them.

"Having conversations is the essence of doing business, is unavoidably part of what we do and at the heart of sales and marketing," he said.

"Relationship-building can only come from a number of different conversations, and those can start in a number of different places but ultimately the face-to-face is what it is all about.

"We are seeing that quite a lot with our vendors. The scatter-gun approach to partner recruitment is being phased out slightly in favour of a more targeted approach, and it is very much around a quality-led relationship than a quantity one."

Bell Integration's Leyland believes that the progression of technology itself has changed the sales landscape, explaining how it used to be about selling name brands, but as resellers make centre services as core offerings, this has changed how they approach potential clients.

"That kind of subtle evolution has caused the reseller or service provider to have to take a different approach to selling," he explained.

"Now, it is often the blend of skills, knowledge, experience and competence rather than giving them the biggest, best and brightest kit and leaving it at that."