Bain & Company
The Importance of Cold Calling
It’s hard to dispute that cold calling yields one of the highest financial returns for new business development. This is why it’s an important consideration in the mix of a company’s new business development strategy. If implemented properly, cold calling is arguably one of the most cost-effective methods of finding new business, one of the best ways of delivering a sales message, and a direct source for understanding the wants and needs of the prospective buyers in a market and the activities of competitors. If implemented poorly, cold calling can not only harm a company’s reputation, but it can be a huge energy drain on sales staff and can hurt overall productivity. Companies fail to realize that cold calling is not a beginner’s activity. It requires training, skill, persistence, patience, organization and consistency to nurture a cold prospect with well-timed communications until the prospect becomes a sales-ready lead.
Cold calling is a numbers game. It takes a large number of calls to get the desired result. The biggest factor in determining daily productivity in this area is how proficient each individual salesperson is at making each call. This includes navigating through a list of leads and determining the priority in which each lead should be called, the speed at which they can manually dial a number, the time it takes to leave a voicemail when there is no answer, the time it takes to type out a note regarding the call, dispositioning the lead, and then falling back to the list to repeat the process.
The average salesperson makes only 8 dials per hour. [Source: Ovation Sales Group]
Only 2% of cold calls result in an appointment. [Source: Leap Job]
15% of sales reps’ time is simply leaving voicemails. [Source: RingLead]
71% of sales reps say they spend too much time on data entry. [Source: Toutapp]
Only 33% of inside sales rep time is spent actively selling. [Source: CSO Insights]
In 2007 it took an average of 3.68 cold call attempts to reach a prospect. Today it takes 8 attempts. [Sources: TeleNet and Ovation Sales Group]
The average salesperson only makes 2 attempts to reach a prospect. [Source: Sirius Decisions] 80% of sales require 5 follow-up calls after the meeting.
40% of salespeople give up after 1 follow-up. [Source: The Marketing Donut]
During the cold call process, salespeople should be communicating a consistent message to cold call prospects. This includes voicemail messages, call scripts and objection scripts. How each salesperson delivers the company’s message will either build trust and confidence in their prospects or undermine efforts to engage them. On top of consistency in the delivery of sales messaging, one of the most effective tools a salesperson has when engaging a prospect throughout the cold call process is information that’s been gathered about the prospect during previous calls. Gathering information about a prospect helps a sales rep understand a prospect’s hot buttons, his or her place in the buying process, and ways to further build the relationship. Between managing leads and workflows, to delivering consistent sales messaging and handling objections, a salesperson has a lot to juggle. This is difficult for even the most organized salesperson to manage well. The more a salesperson is focused on managing a complex sales process, the less focused they will be on the main goal: engaging in quality conversations with suitable prospects. Automating the sales process is important to remain focused on this goal, which is what will help drive sales success at the end of the day.