Is Inside Sales Right for Your Technology Company?


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Traditionally, when building a sales force, tech firms all followed some rules of thumb. Inside salespeople handled the phones, qualified prospects, followed up and nurtured budding relationships. If it was an easy sale, they might even close.

However, when the high-dollar sale required a long, complex sales cycle and several key decision-makers’ input, companies wanted an ace on the job. And that usually meant an experienced field rep prepared to meet face-to-face, demo products in person and build a relationship through lunches and golf outings.

In many ways, 2020 will be seen as the year we passed the inflection point for inside sales. In 2017, inside salespeople made up just 45.5% of sales reps. In 2021, expect inside sales or some hybrid model with minimal face-to-face contact to make up almost 70% of sales. What happened? COVID-19 forced company leaders to think creatively. In doing so, they fully realized the potential of a sales force that could work remotely and connect virtually.

It may be time to consider how to structure your sales teams and the options open to you.

Inside vs. Outside Sales

For years, outside sales reps were the big guns. They commanded the biggest quotas and most of a department’s resources because they landed the big fish.

On the other hand, inside sales, with just phone and email, could connect with more customers and prospects than any field rep. But few thought it possible that anyone could close a big sale without meeting face-to-face to build trust and demo products on site.

Still, while outside sales could be counted on for a 30% higher closing rate and deals that were 130% larger than those generated by inside sales, the expenses associated with outside sales also were higher. In 2013, PointClear estimated an outside sales call cost between $215 and $400, while the cost of inside sales averaged just $50. Inside sales teams could shave anywhere from 40% to 90% off the cost of acquiring a new customer.

Because of the economics of it, inside sales has been growing for almost ten years, and tech companies have been among the first to see the potential. Companies have been growing their inside sales force 15% faster than outside sales, hiring ten new inside sales reps for every outside rep.

The writing was on the wall, but it took COVID-19 and the necessity for a remote workforce to accelerate the transition. According to a recent Hubspot study, 64% of companies that relied on a remote sales model in 2020 hit or exceeded their revenue objectives.

Making the acceptance of inside sales complete are two other influences:

Is Inside Sales Right for Your Company?

So what’s the answer for tech firms, fast-growing companies and any business that wants to grow and prosper today?

Outside sales probably will never disappear. For all the lingering concerns about COVID-19 and excitement about the potential for digital tools in a virtual sales environment, there will be times when face-to-face sales make sense. And there will still be tradeshows and customer events.

Going forward, sales leaders need to have all their options on the table and use them when and where it makes the most sense. And you have many options: inside sales, outside reps, e-commerce, OEM deals, partnerships and third-party reps. What works best in each situation depends on the following:

  • Growth Stage: While we may see this change with the acceptance of digital options, many younger companies feel that it’s easier and more effective to build a brand and product recognition face-to-face. As their reputation grows, they feel they can rely more on remote sales and third-party relationships.
  • Complexity: Large, complex deals with long sales cycles have traditionally gone to field reps. But because it’s getting increasingly challenging to get all the decision-makers together at the same time, virtual meetings, video and online demos are making it easier to handle large deals remotely—especially as inside sales reps become more experienced in closing big sales.
  • Customers: Ultimately, it comes down to what customers want. When McKinsey ran its B2B Decision Maker Pulse survey in 2020, they discovered just how comfortable customers had become with virtual sales. They found that customers were twice as likely to prefer a digital transaction and selected vendors based on the quality of the digital experience.

Teaching Old Dogs the Tricks of Inside Sales

If you decide inside sales is a better model for your company and your field reps are among your most talented and experienced salespeople, you might consider helping them to become more comfortable working remotely.

You can help them learn new tricks. In fact, they likely know a few already. That’s because the amount of time that field reps spend communicating and selling remotely has been increasing consistently since 2013.

To help them work even more effectively in a digital, virtual environment, prepare them to:

  • Prospect for new customers online: Strengthen the ties between sales and marketing so that lead generation and new campaigns meet your reps’ needs. Encourage outside reps to develop a social presence online and use it to prospect remotely. If they can be thought leaders, invite them to blog or post articles on LinkedIn.
  • Build enduring relationships virtually: It doesn’t take a golf outing to build a strong business relationship. Your reps already have access to phone and email, and social media is another way to communicate. Provide the tools and training to get your salespeople using online conferencing for group meetings.
  • Enjoy greater productivity than ever before: Traveling to customer sites is not only expensive; it’s time-consuming. Your outside sales reps may appreciate being able to connect with seven to ten times as many prospects in a day.
  • Engage with customers and prospects digitally: Give them the tools and training to master the technology. With webinars, virtual demos, video and online conferencing, it’s almost like being there. And with access to automated tools, AI-enhanced sales apps and analytics, it may actually be better.

What’s the answer to the question: Is inside sales right for your technology company? In 2021, absolutely. What your final strategy and organization looks like will be whatever makes the most sense to your needs. But inside sales and/or some hybrid model that minimizes face-to-face meetings will be key to your success, growing ROI and profitability in 2021 and beyond.


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