Sales Laundry

I have responded to several variations to questions like “Is cold calling still effective?” with a range of answers.

My long standing official position has been that there is always going to be a right time and place for cold calling no mater how advanced LinkedIn, Face book, MySpace, Twitter, texting, email, mail, flares and smoke signals get as communication tools.

The last two months have proven my point.

Cold calling is simply a sales tool and that is how you should look at it. I am not suggesting you roll cold calling into your mix of sales tools by default, I am just saying you need to understand where and when cold calling fits and makes the most sense.

For the last few months I have been working on sales strategies for an energy company trying to figure out the best mix of tools to reach new customers for them. (Their customer being anyone using electricity with a superset of products where one or more energy source is deregulated.)

The company had a solid referral model in place and a secondary simple lead generation system. Missing from the equation were websites, newsletters, white papers, opt in communications and a strong lead development engine.

To the company’s credit though, they had spent a great deal of time refining the sales forms, sales process and field sales to its simplest form on their operating budget. The field sales tools were truly outstanding and visionary when compared to other large and small field sales forces I have worked with.

The referral model in place was exceptional with a close ratio of 1:2 calls. The quantity and location of the referrals led to a lot of time being wasted with travel no matter how efficiently the call plan was setup. To mitigate the lost time I employed an extremely simple cold call strategy.

For every referral business I visited, I would cold call, or walk in, five businesses in the immediate vicinity with the hopes of at least getting some new leads and at best signing up new customers.

The company’s products worked well with this strategy, requiring no up front commitment or cost, played on the customer’s curiosity, and in the end would almost definitely save them money with a sub 30 day ROI.

All that was needed was a good simple but short explanation of how a company could benefit by our services and the cold call strategy was ready to deploy.

Walking in anything from a local SMB business to a large name brand global organization, at random with no contact name, led to a close ratio of 1:10 calls. For the record, none of the large national/global companies were signed at the time of the cold call, but the process was effective for finding contacts, meeting assistants and doing general sales groundwork that may or may not have been possible with Hoovers or other online tools.

In this particular situation it was effective enough to help me meet an established reps quota my first month in a city I had never been to before and talking to people I never met.

The point is cold calling is still an effective tool. The most effective? No, not by a long shot, but one worth keeping in your bag when your product or sales process works in short, initial meeting types of sales engagements.

Being effective as a field sales representative, trying to beat your quota and break the compensation plan in your favor takes some intelligent work and careful use of your time. As a rule, random cold calling would not be a strategy I would employ or even recommend for those two endeavors unless it just flat out makes sense in your situation.

I know Gitomer and a whole host of sales gurus and probably more than a handful of you would/will say cold calling is for suckers. All I can say is that the last two months cold calling earned me more suckers than the number of days I have been walking on this planet with plenty left over for you, too.

Sometimes it’s good to be sucker.

Image courtesy of http://www.hitched.ca