Telemarketing is the process of selling and promoting goods and services to consumers or businesses over the telephone. It is also an important business tool often used to seek out new customers.
Businesses that use telemarketing for sales are governed at the federal level by the Federal Trade Commission’s Telemarketing Sales Rule (TSR), and the Telephone Consumer Protection Act (TCPA). Additionally, businesses must comply with separate state laws and rules.
Each state has its own telemarketing regulations. These regulations often concern state and federal “do not call” lists, permission to record calls, calling hours, and violation fines.
What Does a Telemarketer Do?
Typically, telemarketers explain promoted products, their prices, and try to persuade the contacted prospect to switch or upgrade their existing service.
The Telemarketing Sales Rule (TSR) requires telemarketers to disclose the sales purpose of the call and prohibits them from misrepresenting information.
In addition, telemarketers maintain sales records, record the reactions of those contacted, make appointments for sales representatives, and follow up on messages left by prospects.
Telemarketing Jobs From Home
Telemarketers often work in call centers and offices, but they may also work remotely. Though remotely-staffed telemarketers are not positioned in an office, they still need to work set hours and meet their daily sales goals at appropriate hours.
Depending on the state regulations, some individual agents may be required to obtain a license to operate as a telemarketer, whether they work from home or in a call center.
Experience and Pay Rate
The role of a telemarketer is often an entry-level position and does not require a great deal of experience. Many employers, however, require telemarketers to have a minimum of a high school diploma or its equivalent.
In the United States, the average hourly wage for telemarketers is $10.40 per hour. With experience, the salary can increase up to $25 per hour, leading to an annual salary ranging between $18,000 and $121,000. Additionally, telemarketers may receive bonuses and commissions for sold products and services.
How Can You Become a Telemarketer?
If you plan to start a business in telemarketing, you will need to follow all industry rules and regulations enforced by your state, and, if required, obtain a telemarketing license or registration. In addition, you may need to apply for other occupational and business licenses and be insured for all of your salespeople/employees.
State and local authorities have different licensing laws and application requirements for the telemarketing industry. Make sure to check with your local business licenses, permits and tax agency to find out more information specific to your business.
General Telemarketing License Requirements
Every state has its own laws and regulations regarding telemarketing entities located in that state. These regulations govern many aspects of the operations of telemarketers including, but not limited to how they find and contact customers.
The majority of states issue Telemarketing registrations or licenses. In some states, local authorities may require licensure as well.
The process to become a licensed telemarketer begins with completing and submitting a Telemarketing license application. It’s important to pay special attention to the information required in the application forms, as incomplete applications may be rejected and will slow down the licensing process.
Most states have similar requirements which include a background check, bonding, and employee insurance. The information requested in the application may include the type of organization (e.g. LLC, corporation), telephone numbers that will be used for telemarketing purposes, personal information of owners and managers, and a description of the products/services sold.
Becoming a licensed telemarketer may also require additional documentation that includes financial statements and proof of insurance.
License Exemption Cases
Before applying for a Telemarketing license, check if your business falls within the state’s category of license exemptions. There are many exemptions for licensing at the state and local level. Some states have license exceptions for telemarketing firms who only call current and/or former customers.
In the majority of states, businesses who contact consumers solely for debt collection purposes do not require a Telemarketing license.
The Florida Telemarketing Act, for example, states that businesses who solicit primarily newspaper sales are exempt from the Florida Telemarketing license requirements. Other license exemptions may include calls in which sales and payments are not required, as well as calls initiated by a consumer.
State and Local Requirements
Each state, county, and city may have different requirements for telemarketing entities.
In some states (like Florida and Alabama), businesses that solicit sales of consumer goods or services – as well as individual salespeople – must be licensed.
In other states like New York, a license registration is only required from the telemarketing business entity and not from individual employees.
Depending on local regulations, some states may require telemarketers to disclose certain information during each call. For instance, Ohio and Florida require salespeople to identify themselves by true name and the business on whose behalf they are calling at the beginning of each call.
Even if you operate in a state that does not require licensing, you may still be required to obtain one if you call consumers from states which require them.
Application forms and documents can usually be accessed through the state licensing agency’s website. Submit your forms – along with any additional documentation – to the licensing agency.
In addition to filing a license application, the majority of states also require telemarketing applicants to post a surety bond. The bond acts as a proof of security and an insurance policy. It provides that the licensee will pay all damages to consumers or the state in the event of unlawful actions by the licensee or their employees (in relation to telemarketing activities).
Bond amounts and requirements are established on the state level. In many states (like Pennsylvania and Ohio) the amount of the surety bond is $50,000. However, bond amounts can range anywhere from $10,000 to $100,000.
Applicants who operate from more than one location may be required to post additional surety bonds, if they have additional locations. Applicants located in West Virginia may file a separate bond of $100,000 for each business location, or a single bond of $500,000 for all locations.
The cost of a telemarketing bond is typically charged as a percentage of the total bond required. In most cases, the surety bond needs to be in place prior to submitting your Telemarketing license application. Telemarketing bonds are usually valid for a period of one year and need to be renewed before their expiration date.
Fees and Taxes
License application fees are different for each state. The number of business locations – as well as the number of employees and utilized phone lines – often influences fees.
Registration and Renewal Timeframes
The majority of states require licensed telemarketers to renew their licenses annually. Additionally, a renewal notice should be sent approximately 30 to 45 days before your license expiration date.