Should Your Salesteam Prospect?

A lot of experienced salespeople HATE prospecting, and in some cases they are right - it's a waste of their time, but in other cases, it's one of the more effective ways to fill the pipeline - So, the correct answer to the question above is: "It Depends". I know that seems like a cop-out, and I promise that I will answer what it depends on, but the truth is - it really does depend.

Let's start with sales environments and situations where prospecting really is a waste of time for your sales team. I'm sure some people who know me will be surprised to hear me say that there are conditions where prospecting is a waste of time for the sales team because generally I haven't worked in environments where these conditions are true - so people who know me are used to me being in favor of the sales team performing prospecting. The reality though is if your products and solutions are transactional in nature and have a low likelihood of repeat business - and thus a low lifetime value for the customers that are secured via prospecting - it likely doesn't pay to use members of the sales team to perform this function! There's no doubt that prospecting with Salespeople (even specialized SDRs or Inside Roles) is very expensive. These team members tend to have salaries that make the per-call cost quite high - Now, the efficiency is usually quite good - especially with dedicated, professional SDRs, but the net cost isn't likely justified if your Customer Lifetime Value is Low.

In a transactional business with low lifetime customer value, the best approach is to fund marketing with sufficient resources to fill the pipeline at the top of the funnel for sales. These marketing-generated opportunities will almost always come at a lower cost than prospecting with a sales team. In addition, the Prospecting developed opportunities are unlikely to drive repeat or ongoing sales and thus the extra cost of prospecting-led development is not offset by the higher likelihood of repeat business that personal prospecting delivers.

The opposite of this scenario is when the product or service that you are offering generally has strong repeat potential making the customer lifetime value many times the value of a single deal. Some other factors to consider that increase the likelihood that having the sales team prospect makes good economic sense and IS a good use of their time:

• A Clearly understood set of Pain Points that have been demonstrated to be shared across these target customers.
• Clearly identifiable opportunities for repeat business (Other Cells in the same plant, Other locations of the same customer, similar companies in the same or similar industries, etc.)
• Strong existing relationships to leverage within a target company or industry.
• Your prospecting model is not Cold Calling - but what I call "Warm Calling" - your team is reaching out to those that are highly likely to both need your product or service AND likely to have that need repeat in their organization.
• The urgency for this type of prospecting increases in an environment where the above elements are true AND marketing proves to find it difficult to supply enough opportunities at the top of the funnel.

The more of the elements above are true, the more prospecting will pay off. The reality with marketing to a very specific target set is that there just aren't that many marketing vehicles that offer the specificity of targeting that a well-planned customer target list and prospecting do. Scratch that: There are no marketing vehicles that can provide this level of specificity - then couple that with the fact that a personal reach out (even via email) is far more likely to have a high conversion rate than a "marketing speak" reach out via a Marketing campaign, and the higher cost of prospecting starts to get offset by a higher conversion rate and efficiency. When you factor in the higher likelihood of conversion into ongoing, repeat business - (The lifetime value advantage) - prospecting becomes a clear win in this environment.

THE CHALLENGES WITH PROSPECTING AND HOW TO OVERCOME THEM

Even when all of the above is true there are often significant challenges with getting a sales team to prospect efficiently using the model above. These include the following, which are real obstacles:

• Even experienced salespeople are generally poor prospectors.
• Most experienced salespeople HATE to do prospecting.
• Almost all salespeople lack training in an effective prospecting methodology like the one I describe above.
• Conflicting metrics and responsibilities: If you try to hand prospecting to your field sales team as a primary responsibility their focus becomes muddy - When do I prospect, when do I progress the deals in my funnel - Most will stop prospecting as soon as I have some deals progressing, etc.

So, the best way to overcome these challenges is through a structured, specialized sales team design. In the ideal implementation of this model, you dedicate an inside role to the Outbound sales development function (commonly called an SDR or Sales Development Representative) - You also dedicate an inside role to the inbound functions for lead follow-up and typical inside sales functions. This overcomes all of the issues above by building a team that is Lower Cost (improving the ROI and lowering the bar on LCV where this Prospecting approach works). The dedicated team can be put together and recruited for their ability to maintain focus and motivation for this role. You now have dedicated team members who can both be given tools and trained to be effective in the specialized prospecting approach. Clarity is given to your field sales team - they are expected to work the deals that are created and be the closer! The big challenge with this level of specialization is that it is expensive and it requires scale to allow you to implement it - Read below for some modifications you can make to build some of the benefits sooner and at a lower cost.

The first modification I would make if I were in an environment where the inside functions couldn't be split is to combine them and keep the field sales team isolated from the conflicting responsibilities that assigning them that the prospecting task would create. The challenge becomes giving very clear guidelines to the inside team on how they are to split the prospecting function and their inbound/customer management functions. The best method that I've seen for this is dedicating time slots for each inside team member for Prospecting - ideally, these dedicated time windows align with the best times to contact and reach the prospect targets that you've defined. The modification that I'd suggest when your situation requires that your field sales team must be engaged in the prospecting are similar: Dedicate specific time slots where they must perform the prospecting function - maybe it's a 4-hour window per week - but make the WHY and HOW clear: Prospecting is effective and will help fill the pipeline efficiently for the reasons identified above and the HOW is by using the effective Targeting strategy defined above.

When the team(whether it's a dedicated inside team or one of the modified approaches I've described) starts to have success with their prospecting, it will become a virtuous circle because they will see results!