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Is It Time to Kill The Cold Call?
In my efforts to stay abreast of what is going on in the world outside my office, I follow the thoughts of several sales training and consulting organizations. Over the last couple of weeks I’ve seen a significant increase in the chatter surrounding cold calling.
While everyone has had a slightly different take on the practice, the thoughts were probably best summed up by @solutionselling’s blog post: Cold-Calling Beats Aggressively Waiting by the Phone…. EVERY TIME!
When I first got into selling, I wore my ability to cold call as a badge of honor. I remember when I started at Merrill Lynch, a good day was when I made 300 calls in a day, and on my “best” day I made 500 dials. I look back on my “smiling and dialing” days much the way a high school football player looks back at their “great” plays.
But, I got to thinking. I’ve built (IMHO) a pretty good business over the last five years and I haven’t gotten a single client from cold calling. When I look at the best clients I got when I was at Merrill Lynch, not one came from cold calling. Don’t get me wrong, cold calling has certainly helped me in my sales career. But, I wonder if it hasn’t caused as much harm and it has helped.
So, I ask you, Is It Time To Kill The Cold Call?
Here are my thoughts:
We first need to define cold call. There is absolutely nothing wrong with making a first contact by phone with someone who may not know you. If you are making that call with purpose, you’ve done some research on the company, you have a least a hypothesis of the problem they have that you can help address and you have a dynamic, multi-pronged account entry strategy to support that call; then I would not define that as a “cold” call. Let’s call these initial calls. In reality, if this isn’t the sole part of your job, you may be able to make 5 of these types of calls a week.
A cold call, in my opinion, is where you deliver a generic message to a defined (or not) group of people in an effort to generate interest. You know little to nothing about the potential customer and you script yourself (whether written or not) to create a “lead.” With this type of call, you can make a virtually unlimited number of calls..
Now the observations:
Pros:
- There is absolutely no tactic that can be taken on the part of a salesperson that will lead more immediately to creating a sales opportunity than cold calling – NOTHING. So, I agree with the post above that cold calling is far better than waiting for the phone to ring. The reason for this is that cold calling allows you to cover significant ground faster than any other tactic. By the nature of its force, you are able to shake opportunities loose. Now, these are not always (actually rarely) the best opportunities nor best positioned, but they do create opportunities faster than any other tactic. The post I referenced tells the story of a sales rep who continued to cold call a prospect for 18 months. My experience is that this rarely works – and I would challenge the rep with what he could have done to accelerate the process if he hadn’t relied solely on cold calling (and if he didn’t rely on solely on cold calling, then that goes against the author’s argument).
Cons
- Cold calling creates a lot of negative equity. Much has been written about interruption marketing, and I won’t re-hash the arguments here – they’re easy enough to find. While cold calling can thrust you into opportunities, it can also really irritate a lot of people and diminish your authority.
- Cold calling takes a toll on the salesperson. There are two types of people in the world: those who hate (or at least don’t like) cold calling – and those who lie about it. Cold calling is monotonous and forces a lot of rejection. No matter who you are, that eats energy.
- There is little leverage in cold calling. It works only as long as you are working on it. There are few, if any, strategic byproducts that come from it, and the only chance it has of working is if you continue to do it. If you get busy and can’t follow up on your calls from “3 months ago” as the post above referenced, you are basically starting all over again.
- What is it that they say about the first impression? Well another problem with cold calling is that it is the junior people who most often do it. Cold calling itself doesn’t require any unique skill set, however, managing the unexpected opportunities that arise in conversation does. So often, a very high-value salesperson is forced to do a low-value activity.
I could go on, but I think my opinion is becoming clear. That said, I do realize the underlying, even if un-desired, need for tactics such as cold calling. So my answer is that it’s not time to kill the cold call, but it should only be used as a tactic when absolutely necessary.
Here’s my prescription:
- If you are a salesperson responsible for more than just lead generation, your goal should be to get in position so you NEVER have to make another cold call within 18 months. Cold calling should be no more than a secondary or tertiary tactic within 12 months.
- If you are a business and you need this for lead generation, develop a highly specialized individual or team that is responsible for doing this – and doing just this. This becomes a marketing function more than a sales function. Additionally, you should hire a research assistant to develop more of the cold calls you are making into initial calls.
What do you think? Is it time to kill the cold call? What changes do you think we need to make to this tactic?
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10 Responses to “Is It Time to Kill The Cold Call?”
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This post was mentioned on Twitter by dougdavidoff: Are cold calls stil useful? http://su.pr/2qcSsQ What do you think?…
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Your philosophy, and what makes your process so different, is that you believe if we find our prospect’s pain and collaborate with them on that, we sell business.
The cold call goes against that philosophy. I agree with you – it’s time to kill the cold call. How many cold calls do you take? I take zero. None. Zilch. So why would someone take mine?
In today’s world of social media, you can network 24/7. It’s MUCH easier to build a relationship with someone on, say, Twitter, than to make 300 cold calls in one day.
We apply this philosophy not only to sales, but also to media relations (I own a PR firm). A reporter is MUCH more likely to do a story on our clients if they have a relationship with us. Gone are the days of mass distribution of anything, including the cold call. People want human, and one-on-one, interaction. Get out there and use the tools available to help you network. It’ll be much more effective.
As usual, Gini, you’re spot on. As a matter of fact your comment has clarified some new terminology to use to get rid of the trite, and ineffective characterization of hunters and farmers. I’ll save that for a future blog post.
Doug,
The cold call, as you define it, should not exist. Simply because if a company is picking up the phone with no prior business relationship OR knowledge of the business person they’re about to ring up — then, darnit, use social media marketing to GET MORE INFO!!!
All calls — ALL CALLS — as you define them should be Initial Calls at the very least.
Think about it in these terms: If I, Dave, pick up the phone and call you, Doug, without knowing who you are, what you do, whether or not we’ve got a chance of working together…that is a waste of time, effort and valuable energy.
Dave,
Great points. I’d add that not only is it a waste of time – that would indicate that it has no impact. In reality that call would have a negative impact. I think (and will spending more time figuring out) that salespeople need to utilize social media tools far better. Thanks.
Doug: agreed on a couple of points. Cold calling as you define it is a selling tactic that’s losing its luster. I don’t think of it as “low value,” however. For some products and services, cold calling is high value. While I’m not condoning it, for some businesses, cold calling works, and I learned a long time ago that any sales tactic that works merits consideration, as long as the tactic is ethics.
The biggest problem with cold calling (and the reason for cold-call bashing ad nauseum) is that cold calling is grossly misused. Metrics around cold calling are established as objectives (they’re not) “I want every one of our sales reps to make at least 100 cold calls per week!” Bad idea. What is the outcome that’s desired? That’s the key question to answer!
Best sales prospecting tactics vary widely. If “cold calling” works for your business, keep it in the mix–with the understanding that this year’s best practice might become next year’s buggy whip.
Andrew,
Thanks for the comment. I completely agree that (especially in these times) any tactic that is working deserves consideration. My intent was not to bash the cold call. My point is not that you shouldn’t cold call under any circumstances (and there are certainly industries and products where this tactic will work far better than others). Instead, it’s to ask the question that whether cold calling is working for you or not, what is the opportunity cost of not finding other methods to create business that don’t the same negative equity. Just yesterday I wrote about the idea of building marketing assets instead of spending resources.
The problem with the cold call is that it only works as long as you keep doing it and the same or increasing pace. There’s little to no leverage, and the efforts put there don’t make creating new opportunities any easier in the future.
Traditional Cold-Calling would be eliminated if all salespeople and sales managers realized that people (and companies) buy in their own time for their own reasons.
Cold-calling, where your intention is to get prospects interested, so you can get an appointment to try to sell them, is ineffective and onerous.
Telephone prospecting where your intention is to find prospects who already want what you are selling, and to immediately, but temporarily, disqualify every one else, is easy and highly effective.
Most prospects who are treated that way are willing to take subsequent calls as long as you are not trying to interest, persuade or convince them. That creates Favorable Front of the Mind Awareness of the salesperson in a large group of targeted prospects. As they become ready to buy, a large percentage of them will will buy from you.
Treating people with trust and respect is a highly effective sales mindset.
Jacques,
Glad you found the blog – and thanks for the comments.
I completely agree that treating people with trust and respect is a highly effective sales (and anything else) mindset.
I’m not sure I agree with the effectiveness of the effectiveness of searching for those that are in an active buy cycle. Our research says that in any given market at most 3% of the market is actively buying at any time and 90% of the market isn’t even thinking about a seller’s solution in any way. The idea that I’ll keep calling, even respectfully and even if the buyer will keep taking my call (which I find happening less and less through no fault of the seller), until you fall into that 3% extracts quite a high toll and expense.
As I discuss in a previous post, I much prefer building marketing assets that attract buyers – even when they’re not in a buying cycle. Through the effective use of content I can cultivate relationship and leave dedicate more of my sales resources to managing the active selling process.
Does your site have a contact page? I’m having a tough time locating it but, I’d like to shoot you an email.
I’ve got some creative ideas for your blog you might be interested in hearing. Either way, great website and I look forward to seeing it expand over time.