IS COLD CALLING DEAD?
By Evan Colborne | April 3, 2017
Smile and Dial. Dialing for dollars. Telemarketing. Inside Sales. Whatever you like to call it, let’s just cut to the chase and call it what it is…cold calling.
With the rise of the internet and digital media, there seems to be a constant healthy debate taking place in sales organizations around the world: Should we be cold calling? Is cold calling dead? If not cold calling, then what?
So the question I’d like to address in this post is: Is Cold Calling really dead? Or, is there still a place for it when selling tickets and sponsorship?
WHAT IS COLD CALLING?
Now you may be thinking “We don’t cold call and haven’t for some time. We warm call because the people we are calling have at least been to a game and are familiar with our product”. Ok, I hear you. But for the purposes of this post, let’s define cold calling as:
Calling someone on the phone who does not know you personally and with whom an appointment for the call was not scheduled.
COLD CALLING EFFECTIVENESS: BY THE NUMBERS
The standard metric you hear is 100 calls per day. From my personal experience making cold calls, I typically saw a reach percentage of 20% (where the person not only answers, but is open and available to speak with you). That’s 20 conversations per day. Studies such as the one conducted by the Keller Research Centre at Baylor University found a 330-1 ratio of cold call outreach to actually booking an appointment. I’ve also seen statistics saying that it takes upwards of 5 conversations on average to close a sale.
Based on the targets you set for your sales team, and the average sale size, you can quickly see how many calls need to be made in order for a rep to reach their target.
OTHER CHALLENGES WITH COLD CALLING
So as you can see from the numbers presented above, cold calling has really become less and less effective as a lead generation tool. However, in addition to its declining effectiveness, there are also several other inherent challenges with the practice.
For starters, Cold calling is making it all about you. You are interrupting someone on their time because you want to sell them something.
Receiving a cold call also immediately puts the prospect on the defensive. Even if what you are offering is something they legitimately want or need, the default answer is most often “not interested”. It’s the same thing in retail. Think of the last time you went to a clothing store. Even if you go to the store with every intention of buying a new pair of jeans, if someone offers to help you find something, you’re likely to say “no thanks, just browsing”. Why? Because you want to buy, not be sold, and when someone interrupts you on your time, you immediately go into shields-up mode.
So with so many challenges, why do we continue to rely on cold calling, or revert back to it after giving it up for a short while? Could it be because we don’t have enough qualified leads in our pipeline? (This statement is not meant to be a knock on marketing). Or is it that we rely on cold calling because it gives us a sense of control? We can control who we are calling, when we are calling, how many times we call them etc.
WHEN IS IT OK TO PHONE A PROSPECT?
In my opinion, as as sales person you have to earn the right to phone someone and expect them to give you the time of day. And you earn that right by proving to them that what you are offering is worth their time because it provides them value, solves their problem, maximizes their opportunity and so forth.
Advocates of cold calling talk about the risks or relying too heavily on email and other digital forms of communication. They say that without phone calls, our sales reps will lose their ability to speak with a live fan. However, this is not taking into account that the purpose of the email is to arrange an appointment for a call, and when done correctly, should actually result in more, and better overall conversations with fans. Phone calls made with a set time/appointment are 1000 times more effective than cold calls (no stats to back that one up, but feel pretty confident it’s correct)!
Below is a model developed to explain the types of communication fans will accept, based on their relationship with the team.
STAGES OF FAN COMMUNICATION
You’ll notice that I believe phone calls are the one of the mediums that require the highest level of trust. You can also see that I am not advocating for total abandonment of the phone. I’m suggesting that the phone need not be the first line of communication, and is a medium that requires built up trust to be truly effective.
THE NEW SALES PROCESS
I am a firm believer in a 6 step sales process: (Credit to Brett Zalaski for first showing me this)
1) Build Rapport
2) Set the Agenda
3) Ask open ended questions
4) Transition to Product Knowledge
5) Handle Objections/Ask for the sale
6) Next Step/Ask for referrals.
I will grant you that not all of these steps can be done through email. A Sales process like this requires either a phone call, or better yet, a face to face meeting to ultimately drive sales.
Sales is all about building rapport and trust with the person you are selling to. From there, your product or service needs to legitimately solve their problem, or provide them value. Value without the rapport will lead your customer to seek a similar value elsewhere. Rapport without value will lead a prospect to keep the sales person on the hook for months, never fully saying no, but never taking the final step and committing to the sale.
If you can effectively build rapport and demonstrate value strictly over the phone, then by all means. However, today’s sales person has a lot of other tools at their disposal, and doesn’t strictly need to rely on the phone. There was a time where the only mode of transportation was horseback. Today there are cars, buses, trains, planes, boats, ubers, taxis and so on. It would be strange to rely only on one mode of transportation wouldn’t it? If you can build rapport and show value by email, text message, tweet, Whatsapp, Snapchat, Instagram, Linkedin, Pinterest, Youtube, Facebook or any other means of communication, then effectively, what is the difference? Does it matter that your first point of contact wasn’t the phone? Did you start to lose your ability to communicate with a live person? Answer to both of these questions to me is a resounding no.
A lot of the purchasing decision has been transferred online, where the person making the buying decision is researching online, and then making the decision about how they are going to communicate with the organization. However, by suggesting that the phone is not the be all and end all, I am not suggesting the end of the sales team. Sales for sports teams still require salespeople, particularly for group sales and b2b sales. That I don’t foresee changing anytime soon.
Communicate with fans/prospects the way they have told you they want to be communicated with. If they email in to your team to ask a question, that means they prefer email communication. So as much as you might be tempted, don’t pick up the phone to call them; email them back! If they call in to speak with a salesperson, then they’ve said they prefer to communicate by phone, so pick up the phone! If they haven’t expressly told you, refer to the stages outlined earlier in this post.
Relying on digital forms of communication because you are afraid of the phone, or live conversation is no good either. Sales managers should focus on developing 5-tool players that are well rounded, and ready to adapt to the situation they are faced with.