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August 6, 2004
A Look Inside Inside Sales
by Sridhar Ramanathan
If you’re targeting the SMB, you already know that Inside Sales is one of the most efficient ways to reach your customers. But when was the last time you checked to see what’s happening in Inside Sales? All that most CEOs know is that Marketing is generating “leads” for Insides Sales which then hands off qualified prospects to Sales. For some products with low average selling price, Inside Sales may actually be responsible for closing sales. It’s worth your time to check it out because even a 10% improvement will result in 10% more Sales.
But what’s really happening inside Inside Sales? How do you know they’re firing on all cylinders?
First, let’s use a popular framework called AIDA. Marketing yields general “Awareness” but also “Interest” from specific inquiries (or “leads” as it’s sometimes loosely called). Inside Sales then qualifies them based on purchase intention, budget, urgency, solution fit, etc. An “interest” becomes “Desire” when the Inside Sales rep books a meeting with the customer prospect. After a qualification meeting, the output to Sales is a smaller list of qualified prospects they turn into sales or “Action.” The ratio of unqualified leads to qualified prospects is an important measure over time. Let’s look at some industry benchmarks for Inside Sales for IT software/services products.
Click to enlarge graphic.
Benchmark Metrics
- Goal should be 20 conversations per day per rep (but if you hit 15 that’s not bad).
- Expect a conversion ratio of about 10% of “Aware” parties becoming “Interested” enough to accept a meeting. This ratio does depend, however, on many factors (strength of value proposition, effectiveness of rep, timing, etc.)
- Conversion of “Interested” parties to “Desirous” (qualified leads) is about 15%.
- Leads have shelf life like groceries. Follow-up within 5-7 business days.
Top 10 Tips and Techniques
- Personalize, personalize, personalize (Google search the customer contact name, check their website for any PR, speak with admin) – it’s about the personal motivation as well as their company’s motivation.
- Measure a few things daily--- # leads, # booked meetings, time to book a meeting.
- Focus on ratios of conversions, not only quantity.
- Define “success” for a booked meeting before you pass it on to sales.
- Don’t call it a “meeting” – try calling it “sharing best practices” or “industry data” or “insights into what your competitors are doing.”
- Do a research call to an individual before calling your designated contact.
- Befriend the admin.
- 7:30-8:00am and 5:30-6:00pm are the best times to reach execs.
- It's about results not only activity. Have a daily contest to see how many qualified prospects you can deliver to Sales.
- It’s also a process. Give input to Marketing to improve quality/quantity of contacts, and check with Sales so you know your work results in Sales.
Resources:
- Schiffman – “Cold Calling Techniques and Telesales”
- Werth—“High Probability Selling” (www.highprobsell.com)
- Parinello – “Selling to VITO by Parinello” (http://www.sellingtovito.com). “VITO” stands for “Very Important Top Officer”
- Hopkins – “How to Master the Art of Selling”
- Bosworth – “Solution Selling”
- Bettger – “How I Raised Myself from Failure to Success in Selling”
Posted August 6, 2004 | Permalink
Posted to Leadership
, Sales Effectiveness