Warming up those cold calls

But times have changed, and between a raft of new regulations placing restrictions on both cold-calling and first-contact emails, you must now be much more careful when using these methods.

That doesn’t mean cold calls or exploratory emails are impossible or even difficult. The key is to ensure you are aware of what you can do – and what you can’t. And there may be a silver lining to the new restrictions: improved conversations with prospective and new clients.

One advisor who thinks so is Jeff Wareham, a self-described former collector of business cards. Wareham, an investment advisor and vice president in the private-client group of Industrial Alliance Securities Inc. in London, Ont., previously would use email to make new connections.

But because of Canada’s new anti-spam legislation (a.k.a. CASL), Wareham has changed his approach – and, he says, his connections with clients are the better for it. “[CASL] has been very positive for me from my business standpoint. It is really pushing me back to looking at direct contact with individuals.”

CASL, with its emphasis on stemming the global tide of email spam and requiring those who send commercial electronic messages (CEMs) to get permission first, is not the only new regulatory hurdle for prospecting advisors. They must also be aware of the National Do Not Call List (DNCL), an initiative of the CRTC launched in 2010. A lesser known but related set of restrictions are the Telemarketing Rules (TRs), also in force since 2010, which help keep aggressive telemarketing in check by restricting when and how such calls can be made. All three regimes are administered and enforced by the CRTC.

Although these three sets of rules may seem like just more regulatory headaches, they can also be viewed as business-building tools that can legitimize your communication with prospects. That’s because advisors who abide by the rules when they are making cold calls or sending emails to new contacts won’t be lumped in with the crowd of irritating spammers and robo-callers. Tim Banks, partner and privacy and communications lawyer with Dentons LLP in Toronto, notes that the new regimes, with their emphasis on transparency and respect for an individual’s privacy, will help law-abiding organizations stand out from the crowd and build confidence with consumers.

The new rules should also encourage advisors to step away from their phones and computer screens more often and spend more time in face-to-face conversations with current and prospective clients. Says Allison Graham, founder of Elevate Biz in London, Ont.: “I believe the financial sector is well positioned [to take advantage of the new rules] because, frankly, we don’t want people reading our stuff if they’re not interested,” Graham says. “They’re not going to become your client just because you send them stuff.”

Here’s a look at how you can continue to use email and the telephone to connect with prospects while avoiding finding yourself offside of the new rules:

CASL

Canada’s new anti-spam rules have been called the most restrictive in the world and they are, by far, the most daunting of the three types of rules that govern electronic or telephone contact. At its most basic, CASL prohibits the sending of CEMs – written, commercial messages sent through electronic avenues such as email, texting and instant messaging applications. You must have the express or implied consent of the recipient before sending a CEM.

Express consent comes from someone directly informing you that he or she is willing to receive these types of messages. The consent is permanent unless the recipient chooses to end the consent, and all messages must include an “unsubscribe” feature to allow people you contact to do so.

Implied consent, on the other hand, is time-limited and usually applies to existing business relationships. If a prospect sends you an electronic query about your business, that serves as implied consent.

Obtaining and tracking consent in day-to-day business situations may seem easier said than done, but advisors can stay within the bounds of CASL with a few changes to their existing prospecting routines. For example, advisors who collect prospects’ contact information through a sign-up sheet at seminars can continue this practice as long as these efforts are completely transparent. “Make sure that newsletter sign-up sheet has all of the language required for express consent under CASL,” says Wendy Mee, partner and privacy lawyer at Blake Cassels & Graydon LLP.

And because express consent must be documented under CASL, that sign-up document could be key if you are questioned by the CRTC later.

Networking that is based solely on oral, face-to-face conversations should include a direct question about followup contact: when you are describing the services you are promoting, ask the person directly if you may email them with more information, suggests Graham. You may also want to explain – without being heavy-handed – that you are asking for permission because of CASL. As soon as is convenient, record the prospect’s name and the date, event name, location and whether consent was given.

Continue the documentation process in your followup: when you email the prospect, refer to your original conversation in the email and remind him or her that permission was granted, says Graham.Although these steps may seem tedious, they are important; breaches of CASL can lead to fines of from $1 million for individuals to $10 million for firms.

CASL rules also formalize the required content of a CEM, which must include your name, your firm’s name, a mailing address and another way to get in touch with you, so be sure to include this information in your followup email.

Banks also notes that social media is subject to CASL. Messages sent through public profiles on networks such as Facebook, LinkedIn and Twitter are not problematic. Caution is warranted if you are contacting someone through a social media network’s private- messaging system. “Remember to comply with the platform’s rules regarding how you can use it for marketing,” says Bank.

NATIONAL DNCL

The DNCL is somewhat easier to deal with than CASL, because anyone who doesn’t want to be contacted by phone must take active steps to communicate their wishes. This is done by registering on the national DNCL. Thus, if you wish to make cold calls, you first must subscribe to the DNCL via the CRTC’s website (which requires a fee). Once you have access to the DNCL, cross-check your cold-calling list with the names on the list.

“Subscription to the [DNCL] is quite expensive,” says Mee, who notes that it can be filtered by postal code to reduce the cost. “You can get all of Canada and [the prices are different], depending on how much of the list you want, how long you want it for, et cetera.”

Advisors are also required to maintain an internal “do not call” list. If someone tells you not to call again, you must comply.

TELEMARKETING RULES

The TRs govern the interaction between you and a prospect during the phone call. This includes dictating the time at which calls are made, based on the time zone of the consumer receiving the call: 9 a.m. to 9:30 p.m. on weekdays and 10 a.m. to 6 p.m. on weekends. Once you begin your conversation, you must identify yourself clearly and your firm by name. (This applies even if you have prior consent to make the call.)

Keeping documents related to your efforts in following the DNCL and the TRs is important. The CRTC will ask to see those documents should it receive a complaint about you, says Banks.

MAKING THE CALL

Once you’ve ensured the phone numbers on your cold-calling lists were properly obtained and that the listed individuals gave their consent to be contacted, check on the availability of the list.

“How widely distributed the lists are will tell you how much they’re worth,” says Rosemary Smyth, a business coach for financial advisors and founder of Rosemary Smyth and Associates in Victoria.

After you connect, use the time well. Persuading a stranger to speak with you is generally not easy. Preparation is critical, says Smyth. Keep a narrow focus on what you would like to accomplish. Would you like to book a meeting or gauge your prospect’s interest in a report you wrote on financial planning for your niche? Always be ready with a rehearsed voice-mail message to avoid mumbling, she adds.

And be prepared for a two-way street. “Make sure your name and information is up to date,” says Smyth, “because people will usually check you out [online] before they call you back.”

DEALING WITH REFERRALS

Referrals are a method of prospecting in which financial advisors should be very careful to follow the rules related to cold-calling and commercial electronic messages (CEMs).

You will often obtain a phone number and email address through a referral, and it can be tricky deciding which way of getting in touch is the most compliant, says Tim Banks, partner and privacy lawyer with Dentons LLP in Toronto.

Here are some key points to consider:

– Canada’s anti-spam legislation dictates that the person providing the referral must have an existing personal or business relationship with the individual being referred. Should you choose to get in touch with the referred individual through an avenue such as email, you must explain to him or her why you are making contact, how you received his or her contact information and provide the full name of the person who provided the referral.

– Your CEM must have all of the features of a compliant message. Note that you may contact the referred prospect only once through electronic means.

– There is no limit to the number of times you can call a referral. However, this communication would be considered a telemarketing cold call and subject to the National Do Not Call List (DNCL). So, you must subscribe to the DNCL and ensure your prospect is not on that list. If he or she is not registered on the list, you may proceed with your call, provided that you know this person has given consent and is expecting your call.

– The simpler way to proceed in connecting with a referral, Banks suggests, is to ask the person who provided the referral to connect you and the referred prospect through an email introduction.

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