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Demand Creation vs. Cold Calling

 

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Cold Calling vs Demand CreationThis is a guest post by Teicko Huber. Teicko is the founder of Focus To Grow, a sales and marketing development firm.

Since 2007, the social web has dramatically shifted power from sellers to buyers. Today’s buyers resist interacting with salespeople until they are good and ready.

So, why do we take our expensive salespeople and insist they must be good at "cold-calling" when the buyer doesn't want anything to do with this? Don't get me wrong. A salesperson needs to be able to communicate in an effective and compelling manner over the phone. The purpose, however, of the communication should not be getting the sale today, but finding potential customers.

Cold calling is an exercise in futility and the least efficient way to find potential customers. I'm absolutely amazed at how many pundits and sales consultants recommend this as a viable approach to sustainable demand creation.

I'm not saying it doesn't work, but who would buy a product with the following traits:

These are horrible statistics for people whose salaries typically cost a company more than $60,000 per year.

Stop using your salespeople to find potential customers, and start making investments that will help create demand for your sales team and your company.

Regardless of your executive title, you must realize that the rapid rise of the social web has changed buyers’ expectations. The fact is they do not want to deal with salespeople until they are 70% down the path of the buying process.

Here are several practical ways to enable your the salesforce to create demand and eliminate the need to cold call:

  1. Eliminate the lowest performers on your sales team and repurpose those resources at the early stages of the sales process to create demand for your company.
  2. Invest in inbound marketing software, such as HubSpot, and build remarkable content that attracts buyers to your website.
  3. Develop a strategic TED-like conference for your industry and feature your best and brightest staff and salespeople in a non-informercial way.
  4. Invest in tools like Visible Gains to build educational video marketing apps that are not like infomercials.
  5. Invest in making your top salespeople sought after speakers regarding industry issues. Investments might include enrolling them in the national speakers association training courses, or hiring someone to market your top salespeople as speakers.
  6. Write a series of must-have industry guides your top salespeople can give away. 
  7. Invest in crowd-sourced lists with detailed meta-data to target your marketing efforts on the phone and the web. One of my favorite list companies is NetProspex.

What other ways have you succesfully created demand for your sales team? What's stopping you from being successful at demand creation?

Photo by: markhillary

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Posted by Peter Caputa on Mon, Jan 17, 2011 @ 03:00 PM

COMMENTS

Pete, 
 
Totally agree that cold calling as you have defined it is fundamentally broken.  
 
Professional sales people that want to prosper in this new sales environment will step up to act like advisors and consultants to their buyers. These people will do many of the things you mention above such as speaking at events.  
 
I also believe they will TAKE RESPONSIBILITY for content to make sure it is developed and delivered to their customers and prospects on a customized basis.  
 
In addition, they will proactively grow their networks to include the industry contacts they need to gain referrals to their key targets (referrals being many times more effective than cold calls). 
 
Nigel

posted on Monday, January 17, 2011 at 3:20 PM by Nigel Edelshain


Actually, there are two opportunities here. The demand that you mention is neither the push nor the pull that John Seely Brown and John Hagel speak of. Instead, it's 'draw': tapping the natural energies between two entities (the cover of their book had the perfect analogy, but they used the wrong term). 
 
But even better, is to track down and fix all of the 'barriers to relationships' that can be found throughout the organization. All the while salespeople are being paid to track down customers, there are people trying to do business with companies who are thwarted in channel after channel, in scenario after scenario. 
 
A good cross-channel analysis is needed. Ironically, the sales people often already know about a lot of these issues. Embrace what they know and start fixing the issues.

posted on Monday, January 17, 2011 at 3:24 PM by Rotkapchen


I think part of the issue here is cost. Time and money. We have experienced success using trained telemarketers for both cold calling and lead qualification. This allows our top execs to focus on meetings and closing business rather than cold call prospecting. This has generated a net cost savings over typical salaries, benefits and training costs for new representatives. Top management can often be hesitant to embark on demand generation programs if the entry cost is prohibitive. Sometimes it's not about completely changing the paradigm, but making little, affordable changes that can generate fairly big results.

posted on Monday, January 17, 2011 at 4:00 PM by Shannon Lowe


My agency did the definitive, B2B study of this topic last year. It was praised by CIO.com and CIO Magazine. If you want a copy, email me and I'll be glad to send you the PDF. Bottom-line: IT buyers complain about cold callers; BUT when offered a way to screen these calls, they shy away. Go figure!

posted on Monday, January 17, 2011 at 4:31 PM by Stan DeVaughn


Get the PDF here: sdevaughn@turnerdevaughn.com

posted on Monday, January 17, 2011 at 4:33 PM by Stan DeVaughn


Anyone have luck with sites such as NetProspect or others like it?

posted on Monday, January 17, 2011 at 4:48 PM by Kevin Burke


Kevin, 
 
Netprospex works well. It's similar to Jigsaw if you've used that. It's a database of contact information like a Hoovers but its "crowdsourced" (like Wikipedia) meaning other sales people put in the information for you to use. 
 
I try to shy away from promotion on blog comments but our site is probably the top resource for information on these tools as Netprospex is a so called "Sales 2.0 tool". You might check out our site for information on other tools that can help your sales (we don't sell tools). 
 
Nigel

posted on Monday, January 17, 2011 at 4:56 PM by Nigel Edelshain


Inbound marketing, MA tools and leveraging social media are great ways to identify new prospects & generate new leads. They certainly help supplement the pipeline development but cannot be depended upon as the sole source. The point I am trying to make is that the traditional outbound marketing services are still needed. Like marketers or sales people still need the qualified databases/ lists for Direct Mail and Email campaigns. There also is a need for the telemarketing services for Lead Qualification. And then the CRM databases have a shelf life. So the data append and hygiene services are required as well. Marketing & sales strategy, budget, industry and competition dictate which services will be required and their mix. 
We work with several companies that use high-end MA tools and inbound marketing and we continue to see a need for targeted role based & phone verified lists, database cleansing, appointment setting, surveys etc. 

posted on Monday, January 17, 2011 at 8:29 PM by Arvind Sehtia


Peter,  
 
I think cold calling work great if you want to focus on a niche market where you want to contact these set of decision makers and then deliver the message about your product or services. 
 
Regarding the cost it is cost-effective if you integrate Outsourcing in your plan, Like say you need to target 1000 decision maker in a particular industry. You can get the databse easily from sites like jigsaw and then you can get help from companies like smebackoffice.com and help to devise a comprehensive plan that will include email marketing, then making contact using Linkedin and cold calling to get your message to the target audience. And even considering a successful conversion rate of 2 per cent or 20 SALES it is efficient and most importantly it is targeted and you can get quick results. Which cant be assured with all types of inbound marketing campaigns. 
 

posted on Tuesday, January 18, 2011 at 12:33 AM by niladri


We run two companies www.winegifts4u.co.uk this is an e-commerce personalised gift web site, the other business is www.vindeterre.co.uk/ this is a wholesale business supplying beers, wines and spirits to pubs and restaurants. 
 
 
 
Our experience over the past 14 years has shown that we need a sales person consistently calling on new establishments to sell our wholesale products predominantely because they do not use computers as part of their daily rountine. We have found that our revenues drop if we do not do this.  
 
 
 
Our on-line business does not have a sales team but uses all the on line applications to build authority. This has led to good orders and leads.

posted on Tuesday, January 18, 2011 at 5:06 AM by Asgar


I'm impressed by all the insightful comments. 
 
It's not that other methods don't work. The primary concern is the inefficiency of many traditional approaches. Many companies don't take the time to fully understand all their options and move too quickly what they are most comfortable with.  
 
@Shannon makes a great point. I really like working with companies with hers to extend the effectiveness of inbound marketing campaigns. Or, I see a tremendous opportunity to incorporate videos into her process produce an even stronger ROI on top of the value she is already providing. 
 
#NetProspex-I think this is an amazing tool and they one up everyone with the ability to pul data by metadata. Brett Samurin is the guy I go to with all of my questions.

posted on Tuesday, January 18, 2011 at 7:47 AM by Teicko Huber


Interesting statistics on cold calling. May revisit this article for cold calling stats. Thanks.

posted on Monday, January 24, 2011 at 3:58 PM by Jerry Everett


Comments have been closed for this article.