There is a lot of talking and blogging going on about cold calling and whether it is a necessary or even desired part of the sales mix. I can’t resist putting in my two cents on this discussion.
I have recently seen a couple of studies and listened to some presentations about the changes taking place in how sellers and buyers are interacting that are worth considering as we leap into the fray. In general, the trends discussed are reflected in the 2010 DemandGen and Genius.com study titled “Inside the Mind of the B2B Buyer.”One of their key findings was that more than 80% of B2B customers/buyers said that on their transactions that they had initiated contact with the seller. Only 10% said that they were contacted cold by the seller.
Personally I’m not convinced that the 80%, is an accurate reflection of the sales situation today. But that is really beside the point. The key takeaway is that it is an indicator of how your customer’s perception of the role of sellers has changed and how the actual role of sales is continuing to evolve at a rapid pace. The Internet and social media have irrevocably transformed how conversations with some significant fraction of your prospects are initiated. And, even if you, as a seller, initiate contact with a prospect, chances are high they are going to possess some level of pre-education and pre-qualification on your product and service on that first call (or they are going to acquire it by browsing your website while on the phone with you.)
What does this mean for cold calling? In an ideal world, cold calling wouldn’t be necessary. In our fantasy, marketing departments would prove capable of generating well-targeted (or “sales worthy” to borrow a term from my friend Nancy Nardin) in-bound sales leads in such large quantities, week after week, month after month, that all available sales time would be consumed with responsive follow-up. Wouldn’t it be great if the world were handed to you on a silver platter like that?
Unfortunately, that dreamy ideal world doesn’t exist for most companies. Using the figure from above as an example, even if you meet 80% of your sales goal today from prospects that originated as sales worthy in-bound sales leads, where will you find the remaining 20%? You will find them from proactive prospecting (i.e., cold calling.)
If you’re in Sales your job boils down to this: doing the hard work required to meet your goals. Whenever there is a gap between in your pipeline between the number of qualified prospect your need to meet reliably meet your goal and the number of qualified prospects in your pipeline generated from in-bound sales lead conversions, and there will almost always be one, it has to be filled in by prospect activity generated by you. This means fulfilling your responsibility as a salesperson to do what you have to do in order to meet and exceed your assigned goal. If this means spending a portion of every day following a disciplined prospecting process (i.e., doing some research to pick targets, making connections online, getting on the phone or going out and making calls) then that is what has to be done.
In my first professional sales job out of college, in the pre-Internet dark ages, I was selling big computers. Everyday involved getting kicked out of the office at 8am and venturing out to make cold calls out in my territory. I have to admit it didn’t come naturally to me. So I developed another approach. I hit upon a system of hosting a seminar in our branch office every Wednesday afternoon at 4pm during which I would demonstrate our system. I used business directories to research names of potential prospects in my territory and mailed out 10 postcards with a hand-written invitation every Thursday. I’d follow up with everyone on the following Monday morning and again on the morning of the seminar. Usually I’d end up with one or two attendees each week. Within months I had a strong, constantly renewing pipeline and was killing my numbers. After a couple years, I was getting two thirds of my business from existing accounts and referrals. But every Thursday, I was still sending out 10 postcards and every Wednesday I was playing host to new prospects.
No matter how many leads you receive, cold calling, or proactive prospecting, remains a necessity for most salespeople and most sales teams. Clearly the amount of time a salesperson has to devote to cold calling could shrink as increasing numbers of prospects pre-educate themselves online and initiate connections with potential vendors. But the role sales prospecting plays in building a strong pipeline of qualified prospects to ensure that you make your numbers is will never go away completely.
Sometimes you just gotta do what you gotta do.
This is not a trick question.
Are you selling or is your customer buying? The answer is both. There is both a sales cycle and buying cycle(s) occurring concurrently on every deal. Understanding the balance between the two is essential for every seller.
Why is this important to you? Because the sole purpose of a sales cycle is to support the buying cycle by helping the customer accomplish a single task: making a fully informed decision to purchase the right product or service for their needs. If you, as a seller can also, at the same time, enable the customer to make that purchase decision in the shortest time possible then you will have created value for the buyer, established credibility, built trust, and put yourself at the head of the pack competing for their business.
The Balance of Power has Shifted
In the olden days, in the pre-Internet world, buyers of product, your prospects, were completely dependent on sellers for information about the products they wanted to buy. There were no websites to search and very few reliable third-party sources of information about products that you could use to guide your purchase decision. The result was a much more casually paced buying cycle as the customer had few options to control the pace.
Then the Internet upended that whole cozy arrangement. Within a matter of years the customer was no longer dependent on the seller for product information. Brochures were replaced with websites that were usually full of more information than even the salesperson knew. Online communities provided users with a forum where they could voice their unvarnished opinions about products and services to all who were interested. Buyers had access to a whole spectrum of information that hadn’t existed before or that had been shielded from them by the sellers. Suddenly, the buyer was in charge of his or her own buying process.
Do Not Pass Go
There can be some debate about how many steps there are in a customer’s buying cycle. Personally I believe that there are six steps in the buying cycle. But no matter how many steps the prospect has to complete in their buying cycle, one fact remains: a buyer won’t progress from the current step in their buying cycle to next until their information requirements for the current step are fully satisfied. This means that each step of a buying cycle carries with it certain requirements for information that must be received by the prospect before they will move forward to the next step.
Sellers Control the Pace of Deals
When sales cycles get stretched out salespeople always point their fingers at the buyer. To them it is always the customer who’s the culprit when the sales cycle stalls. In truth, the opposite is true. It is nearly always the seller’s fault when the buyer stops making progress towards an order. Why? Because the seller didn’t provide the prospect with the information they needed to move on to the subsequent step in their buying process. If the deal you are working on suddenly loses momentum, take a look in the mirror before you begin pointing fingers at the customer. Then, you must quickly determine what data the customer needs from you to satisfy their requirements for the current step of their buying cycle and get back on track to an order.
We Are Not Alone
As a seller you must also understand that there is a good chance that there will be more than one buying cycle occurring simultaneously. Your prospect will have a separate buying process for every seller in a competitive deal. This is extremely important for a seller to understand. If you can be completely responsive to your prospect’s information requirements then you can gain a competitive advantage over your competitors.
What the Successful Seller Does
The successful seller is the one that most closely aligns their selling resources (i.e., their product knowledge and industry expertise) with the buying needs (i.e., information requirements) of the customer to enable them to make the optimum informed decision in the least time possible. This means that you have to place your people with the deepest product knowledge and industry expertise closest to the customer.
To help the prospect move through their buying cycle in the shortest time you have to eliminate the “get-backs”from your selling. Every time a salesperson can’t answer a prospect’s question and says, “I’m sorry I’m going to have to get back to you” he or she is slowing down the buying cycle. Having the right salespeople on your team who can be completely responsive to the prospect’s need for information and help them move through their buying cycle in Zero-Time will definitely enable you to win more orders in less time.
The First Seller with the Answers Wins
A buying cycle is nothing more than a search for information in the form of answers to questions. How a seller conveys that information to the prospect will be the difference between getting an order and losing a customer.