Knocking on doors, waiting in lounges, fixing ties and dressing up—such is life for an outside sales rep.
Business to business (B2B) selling largely involves reps going for physical visits to client sites, at least traditionally. These days, though, the number of companies using outside sales reps has been dwindling.
In a study by Dr. James Oldroyd, elite researcher on the mathematics of selling, sales reps who hit the streets are becoming rare in the b2b world.
His most recent research revealed that companies are hiring for outside sales positions less aggressively. It’s at 0.5 percent annual growth compared to inside sales posts which are getting hunted for and filled at a steady 7.5 percent to 10 percent each year.
Hybrid positions where sales reps handle inside sales and occasionally go on face to face client visits are seeing less need and push to go out on-site. Dr. Oldroyd found that even those who were hired as outside reps conduct 40 percent of their selling over the phone.
What do you think is the reason for this shift? Well, it’s not hard to see that the internet has changed the way businesses operate, the way salespeople sell. People are increasingly connected. A lot of business processes are done on the cloud. Even the C-suite is becoming extra comfortable talking to reps on the phone.
Of course, over the phone sales has gone leaps and bounds away from its traditional sense.
When we say inside sales, it’s not telemarketing. Let’s get that out of the way.
Inside sales reps are trained to become subject-matter experts and communication gurus who can pick up cues and move the prospect through the sales funnel remotely. They are skilled in various communication channels, as they should be. Inside sales reps use a combination of social media, phone, video conferencing, email and texting to reach prospects and sell.
However, does this mean that outside sales reps have no place in business today?
To answer this question, we have to dig up by asking more questions.
Value of outside sales
What value does an outside sales rep bring that can’t be done through inside sales?
The biggest change here is that customers are able to inform themselves without the salesperson having to be the sole source of information. When prospects have a need, it’s super easy to go online, search for a couple of queries and get a grocery list of solutions. From these solutions, customers can research and find out a ton of information about the solutions without ever having to speak with a salesperson. In fact, according to a study by Google, B2B prospects are already 57 percent ready to purchase by the time of first contact with a sales rep.
In the current B2B client journey, it’s not outrageous to say that it looks like outside sales is heading out. However, this might be short-sighted. It’s easy to get excited about inside sales and its conveniences (and effectiveness!).
Let’s see here.
Sales departments typically choose between an inside sales model or an outside sales model. Inside sales has been booming and is wildly popular because of, primarily, its effectivity. Outside sales which involve field reps who travel to client sites for face to face meetings are still used by companies to get the advantage of having a physically present representative speak with decision makers.
All businesses processes can be done remotely but there’s no replacement for outside sales reps who are able to create and develop relationships with prospects, leading them through the emotional side of buying and persuasion. Now that’s something that can’t be replaced by remote teams.
Although inside sales has been leaving outside sales in the dust in terms of growth, the question still stands: What is good for business?
The answer is it depends. It’s not a safe answer, it’s the correct one.
First off, the two are inherently different in the kind of deals they bring in. Testament to this are companies that hire teams both for outside and inside sales that work together.
Let’s look at the comparison:
► Inside sales reps can make many calls a day, many touches through the computer and can get more done because they are physically present with the team, most times.
▷ Outside sales reps have to travel cutting down the number of touches they can make each day.
► Inside sales reps have an easier time prospecting. Everything they need is just on their desks.
▷ Outside sales reps mostly rely on inside sales reps to prospect or use phones themselves to touch base before going onsite.
► Inside sales reps prospect, nurture and sell but mostly lower ticket items within the b2b world (which are still huge contracts!). Most of their top tier clients require an onsite meeting before signing off on contracts.
▷ Outside sales reps, while with longer sales cycles, tend to close bigger ticket items.
► Inside sales reps make seven times as many pitches but on the average convert only 18 percent.
▷ Outside sales reps have a conversion rate at 40 percent on the average.
► Inside sales reps work mainly with software solutions which are booming in today’s b2b space.
▷ Outside sales reps need to go onsite to sell products that demand servicing, attention, physical demo, and setup.
Clearly, the two bring their own value into sales. It’s important to note that many sales organizations these days adopt the inside sales model. One hire for outside sales is matched by ten in inside sales.
However, it’s very clear that outside sales isn’t heading out just yet.
Outside sales: Not heading out
A Harvard Business Review study reported that while many businesses are switching to inside sales, businesses still see the value in the relationships built by outside sales reps. A participant said, “Field Sales is more strategic, meeting with C-level executives and developing strategic business innovation to help them grow their business versus inside which is more quantity and not as in-depth the majority of the time.”
Again, hybrid departments that have both inside sales and outsides sales team in play is not uncommon. Outside sales reps work with inside sales reps to pin down huge accounts while inside sales reps use part of their time selling to smaller clients remotely.
How do you choose which model to adopt?
Here are questions you should ask yourself:
- What are you selling?
- To whom are you selling?
For higher ticket items, inside sales rep work great for prospecting and moving customers along the sales funnel. However, for most huge contracts, a field sales rep is likely needed to close the deal. Low ticket items can easily be handled by a competent inside sales team.
Then who is heading out?
Forrester Researcher Andy Hoar’s presentation at the 2015 Forrester Sales Enablement Forum didn’t mince words about the future of certain sales positions.
According to Hoar, out of 4.5 million B2B sales professionals today, one million jobs will be displaced by other posts by 2020.
However, in Hoar’s report, it’s not so much outside sales reps that are going to be displaced—it’s reps that engage in linear, non-complex buyer dynamic, product and service. The sole reason is that if the internet can sell it for the business, they don’t need a client-facing employee to do it.
Here are the types of B2B salespeople starting from those who are likely to get displaced to those who will take stronger roles in the next four years.
- Order takers
Salespeople who only collect orders but do not make any diligent attempts to find new customers, or to persuade existing customers to increase the size or frequency of their orders. Hoar says, “Order takers are in the cross hairs, because if [a buyer] knows what they want and they’re ready to buy it, just give it to them. Enable them to buy it — don’t create friction.”
Salespeople who seek out clients proactively but are selling a simple solution not needing a lot of explanation and demos.Hoar says, “If you look at really compelling websites, they provide things like how-to videos, detailed facts, and user-generated content. So as technology gets better at explaining things, we don’t need humans to explain any more.”
Salespeople whose task is to explain complex products and services to clients who are easily found or come in as inbound leads. With the rise of tools and integrations, the streamlined procurement will cause navigators to be needed. Forrester reported in a survey that 91 percent of B2B buyers would like to interact with salespeople when it comes to negotiating price negotiations.Hoar says, ” I see a clear trend toward software and algorithms doing more of that.”
Salespeople who are subject matter experts and can demonstrate product benefits to clients in a consultative manner. This category is expected to grow in the coming years as consumers and clients become more informed.Hoar says, “Consultants are a qualitatively different bunch of people. They can explain abstract concepts; they can solution sell; they can build relationships. They’re true consultants.”
Bring value or get out
People can go luddite and say that machines are beginning to replace salespeople—the truth is that the current business and sales climate separates the competent from those who are coasting.
Outside sales reps will continue to bring value by being able to close sales selling in a consultative way.
Latest posts by Dan Sincavage (see all)
- Sales Managers: Help Your Reps Overcome Sales Fears - October 25, 2016
- 5+ Tips to Smash Your Q4 Sales Goals - October 20, 2016
- SOS: Common Problems of Underperforming Inside Sales Teams - October 14, 2016