Unfortunately, most of the "evidence" used to argue for and against cold calling has been anecdotal at best, and the lack of empirical data regarding the efficacy of cold calling makes the debate interesting, but not necessarily useful for decision making.
Recent research by Baylor University's Keller Center for Research takes an important step in quantifying the effectiveness of cold calling as a lead generation tool.
The Keller study involved 50 real estate agents who made a total of 6,264 cold calls over a two-week period. The agents were using a generic, random list of telephone numbers from a geographic area not previously marketed to by the agent. So, these were truly cold calls.
Here's an overview of the study's major findings:
- Of the 6,264 calls placed, 17% were non-working numbers, 55% were not answered, and 28% were answered.
- Of the 1,774 calls that were answered, 1,612 of the prospects (91%) were not interested in the offering or refused to provide additional information.
- The agents involved in the study generated 19 appointments with prospective clients and received 11 referrals as a result of the calling effort.
- The agents had to make 209 calls to obtain one appointment or referral.
- The overall "success rate" for the calling effort was 0.5% (30 appointments and referrals / 6,264 calls placed).
- The authors of the study assumed that "bad" calls (non-answers and non-working numbers) required (on average) one minute per call and that answered calls required (on average) five minutes per call. Based on these assumptions, it would take about 7.5 hours to make 209 calls and obtain one appointment or referral. (In other words, based on the authors' assumptions, it would take one full day of calling to get one appointment or referral.)