Simple Sales Tracking Blog

Does Cold-Calling Still Work?

In my last article I ranked cold calling at the bottom of the list as far as prospecting activities were concerned.
This caused a number of comments which I felt needed to be addressed.
I define a cold call as “calling on someone who doesn’t know you and is not expecting your call or visit.”
Now most experienced salespeople will have their cold calling story of the “big one” they got as a result of cold calling a prospect.  However for every one of those there are 100’s of prospects they burnt along the way as a result of a cold call.
Ask these same successful salespeople if they still cold call and the answer is always no as their business now comes from referrals.  But everyone has to cold call to get started I hear some of you saying.
The answer is that if you don’t have any other prospecting systems, then yes, you will have to cold call when starting out.  The plan then is to have your prospecting plan organised to get enough referrals to fill your diaries.
The punishment for not achieving this is cold calling and if you must do this then only ever cold call “C & D” type prospects  – that way if you burn them you haven’t wasted a major opportunity.
I was reading an article recently by Frank Rumbauskas the author of “Never Cold Call Again” and he mentioned some research by the Keller Research Centre at Baylor University in Texas.   The study was based on a group of 50 experienced and qualified salespeople who made a total of 6,264 phone-based cold calls over a two week period.  And the results were far worse than even he would have expected.  “Dismal” would be a compliment says Frank.

Here’s how it turned out:
72% of the calls were outright rejections.  People saying “no way,” hang-ups and so on
28% of the calls were labelled as “productive”.  These were people who didn’t hang up right away showed some interest, gave a referral, asked to be called at a later time and so on.

But what was most interesting is that the majority of the two week study period was spent working on and following up with this 28% of the list.  The time that went into it was extraordinary and very eye-opening when you see the final results.
That 28% – totalling 1,774 calls, resulted in 19 – yes, that’s NINETEEN  appointments.  Out of a total of 6,264 cold calls made!
The success rate of cold calls to appointments is 0.3% (based on the average closing rate of 20%, that would equate to just under 4 sales, from 6,264 cold calls)
Now that you have heard the horrific numbers experienced during the study, here is the conclusion drawn from it.

Experienced salespeople can expect to spend 7.5 hours of cold calling to get ONE qualified appointment.   That’s an appointment – NOT a sale!  Cold-calling is a numbers game – A BIG numbers game – and one we are bound to loose.

My suggestion is to follow a structured prospecting plan which will lead to the right number of referred leads and sales.

My next article will focus on how to achieve this.

Quote of the Month:
“At the age of three, we all possessed three important skills to make the sale:
Persistence, creativity, and the ability to ask one question after another”
Dirk Zeller

Brett Burgess is a Sales Trainer and Programme Developer for Sales Impact Group.

Filed under: Sales Techniques and Strategy, ,

What Are Your Key Prospecting Activities?

This is a question I always ask when meeting salespeople and sales managers.
The answer I often hear is “cold calling or managing referrals from existing clients.”

The next question I ask is “what processes do you have in place to maximise these opportunities?”

The answer is usually “none”!

Which leads me to the subject of this article which is “Prospecting Activities” or
more specifically  – “Planning your Prospecting”.

The first place to start in developing your plan is to work out your numbers.   The key numbers for us in sales are:

• Total sales for the year expressed in dollars
• Conversion ratios – leads to appointments – appointments lead to sales
• Number of sales we can expect from existing clients
• Number of new sales to new clients
• Average client value based on sales over 12 months e.g. an average customer spends $600/week every week, over 12 months they spend $31,200.  This is the real dollar average sale

By working through your numbers you will arrive at the estimated number of referrals you need to generate on a weekly basis to achieve your sales targets.

This will help you to focus on the prospecting activities that will yield the highest return for the time invested.

In my experience there is a hierarchy of prospecting activities salespeople participate in.

I have ranked these as to what I believe is the value of their effectiveness in generating qualified referrals which give the highest chance of converting to sales.

1. Referrals from centres of influence
2. Referrals from advocate clients
3. Self referrals from marketing and advertising
4. Referrals from business referral groups
5. Attending networking events
6. .
7. .
8. .
55.   Cold-Calling


For many salespeople the biggest challenge is managing their prospecting time
effectively, therefore focusing on the right prospecting activities can pay huge dividends if managed properly.

No 1 on this list is referrals from centres of influence.  This is the most valuable prospecting activity if managed correctly.

The key is selecting the right centres of influence.

The criteria we use is:

1. The very best at what they do
2. Have the same type of clients that you do but don’t compete
3. They are active in sales and business development
4. You may only have one in each field

Once we have selected our centre of influence (C.O.I.) the next step is managing the relationship.  This is where most salespeople drop the ball – they sell the concept of swopping referrals to the potential C.O.I. then neglect to follow up.

The key to managing these people is regular contact.  I recommend monthly face to face as this leads to a more solid relationship which in turn leads to more referrals therefore more sales.

We will look into this in more depth in my next article.

Sales Action Step –

Make a list of at least 10 professions who have the same type of clients that you have but don’t compete.     These will form the nucleus of your centre of influence group.

Brett Burgess is a Sales Trainer and Programme Developer for Sales Impact Group.

Filed under: Sales Techniques and Strategy, , , , ,

How Many Sales Interviews Are Your Team Doing?

Recently I was questioning a sales manager about the number of new sales interviews each of her sales team did each week.

Her answer was that a week probably wasn’t the right duration – more like a month.

When I asked how many they were doing a month the answer was that they would be lucky to average one a month each.

The explanation for this she said was that they were busy sorting customer problems, building the relationship, doing pricing/proposals, delivery services or installations.

My thoughts were she didn’t have salespeople; she had very expensive mobile customer service reps disguised as salespeople.

This is a problem I see in many businesses I work with – the sales teams getting bogged down in the admin and low payoff areas of the business.

There are two reasons for this –

Firstly the company is under resourced which means the salespeople must be “jacks of all trades”. While I understand not all businesses can afford to add adequate support staff to take on the extra duties that could be delegated by the sales team, the questions I asked the sales manager were –

1. What was an average client spend over 12 months Answer: $6000

2. What was the average conversion ratio of your salespeople? (Most businesses guess around 80%, in fact conversions for most companies run at around 35-45%, say we work on 50%)

3. How many extra appointments with new prospects could your sales team do if we took away one activity, say quoting? Answer: 5 new appointments per week

If they converted half of these that would be 2.5 extra sales per week or $15k if we translate these into dollars or $780k over 12 months
Quite a compelling argument for freeing up your sales teams time!

The second reason is a lack of confidence in the actual salespeople themselves usually due to a lack of sales skills/systems. Interestingly enough I often see this lack of confidence in very experienced salespeople who have fallen into the role of “farmers” over the years.

“Farmers” is the term given to salespeople who spend the majority of their selling time managing existing clients and selling to these clients and slowly get out of the habit of prospecting and selling to new clients.

These “farmers” have become busy looking after the relationships they originally gained through prospecting.

The lack of confidence to go out and prospect for new clients generally stems from a lack of a step by step plan on how to prospect.

The answer most sales managers and business owners offer on how to prospect is “go knock on enough doors and you will get the business”. This is known as “cold calling” which is defined as: “calling on a prospect who may not know you and isn’t expecting a call”.

Some companies believe sending a letter then ringing helps to warm the call up. In my opinion the only advantage of this type of approach is that it may save the salesperson a little time.

Cold calling is a punishment for not having a prospecting plan.

We will look at this in more depth in my next article.


There’s no magic to it, and you don’t need a lot of natural talent.
What you need is a disciplined organized approach to selling.
If you have that, you’ll outperform the great salesman
who doesn’t understand the process every time.
Selling can definitely be learned.

Steve Bostic

Brett Burgess is a Sales Trainer and Programme Developer for Sales Impact Group.

Filed under: Sales Techniques and Strategy, , , ,


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