No Surprise Here: Our own data supports the trend towards Inside Sales
Let’s face it. Setting B2B sales appointments requires a significant investment of time, effort and money. To explore the extent of this investment, we at VSA reviewed a small, informal set of our own internal data. Our non-scientific review showed us immediately why companies increasingly avoid using their highest-paid sales people and now rely on Inside Sales teams for the heavy-lifting required to set appointments.
It’s simply too expensive to apply 6-figure Outside Sales salaries to the role of lead development. We at VSA also hypothesize that Inside Sales professionals who typically earn lower salaries can perform this job just as well, if not better. (Validating the second statement is for another article.)
VSA analyzed data from a sample of 49 appointments that we set in the last few months of 2015. From initial contact to the time the appointment was set, the fastest conversion was 0 days (i.e. the appointment was set on the first call—a rare but possible occurrence!), and the longest 547 days, with 97.6 days, or a little over 3 months, as the average. The minimum number of calls made before the appointment was set was 1, the maximum was 25, and about 8 calls was the average. On average, we left voicemails on 33% of these calls. We typically send 3 emails per prospect to follow-up from the phone calls. All of this amounts to approximately 0.4 hours (24 minutes) spent on an individual prospect where an appointment is set, assuming that each phone call takes 3 minutes (although many calls often last longer). Keep in mind that this analysis does not take into account the time spent on prospects that never result in appointments. We have found that approximately 3-15% of a given list typically become appointments.
Anyone can do the math. It’s easy to apply an assumption of a conversion rate to a list of leads, and then calculate the cost of working each of these (24 minutes) to estimate a budget and calculate the cost per appointment. Compare the expense of using an Outside Sales professional or an Inside Sales team, and the difference is stark.
We regard our boutique B2B Inside Sales operation as a microcosm of what sales teams nationwide face. We set appointments for sales teams at an array of companies across the country, focusing mainly on companies that offer complex products or services and complex, multi-step prospecting processes. However, the trends we face in our market segment probably parallel other B2B appointment setting trends – regardless of industry.
Our small, informal study supported just where the industry is going. As reported in a Lead Management Resources study from 2013, the Inside Sales industry was growing at a rate 15 times greater than Outside Sales, with a projected 800,000 new jobs over three years. With the time and energy required to set sales appointments, I don’t see any reason this trend will stop.
VSA is an outsourced B2B lead generation and appointment setting firm focusing on complex products and services and complex prospecting approaches.