Does Cold Outbound Prospecting Even Work?
October 14, 2023
In many growing companies, the primary objective of the sales and marketing teams is to generate qualified leads that convert and increase revenue. There are a variety of tactics sales and marketing professionals can utilize to accomplish this goal, but two techniques that have been around for decades are cold calling and cold emailing.
The question is: In today’s age of digital marketing, are these tactics still effective?
The answer: It depends.
These techniques offer the advantage of reaching a wide audience quickly and, with automation and targeting, hold the potential for a more personalized approach that enables you to tailor messages directly to individuals. Cold calling and emailing can act as a gateway to engage with companies or individuals who might not have initially considered your business, opening doors to potential opportunities, which can be priceless to sales and marketing teams.
The Clear Downsides of Cold Outbound Prospecting
It’s crucial to acknowledge the downsides of cold outbound marketing as well. Cold calling and emailing methods can be perceived as intrusive and annoying by recipients.
- In fact, research indicates that about 57 percent of people feel negatively towards cold calls.
- As for cold emails, approximately 70 percent of people delete cold emails without even opening them.
Additionally, there’s a low response rate for cold emails as one study shows that the average response rate is only one percent. But with the right strategy, cold outbound prospecting and inbound marketing can work together.
How Cold Outbound Prospecting and Inbound Marketing Work Together
Instead of relying on cold calls and emails, numerous marketers prefer using targeted advertising and inbound marketing.
Targeted advertising involves utilizing tools like social media and search engine ads to connect with specific audiences. What sets this approach apart from cold contacting is the ability to meet your audience where they are. This could be through a website related to your business or by addressing their concerns or questions that you can help answer. The downside is that it can get expensive quickly.
Inbound marketing revolves around creating valuable content that attracts potential customers to your brand. This content could be anything from a blog, video series, case study and more. Overall, it’s something that provides valuable information for your audience without asking for anything in return. In turn, it helps establish you as a subject matter expert and keeps you at the forefront of your audience’s mind when they are ready to engage with your products or services. The downside here is that inbound marketing doesn’t produce immediate results. It’s a longer play strategy as you’re waiting with the answers and solutions before your audience knows what question to ask.
These two downsides are the reasons that many companies still rely on cold prospecting to kickstart a growth strategy. And as we know, most CEOs are not patient when it comes to scaling growth! Considering that cold emails and phone calls will prob- ably happen at some point in the future for your business, it’s essential to be equipped with the best possible approach to maximize your success.
How to Get the Most Out of Your Cold Outbound Marketing
As we like to say, “Marketing is not a switch, it’s a dial.” Sales and marketing can actually be thought of as a control panel with multiple dials. You’re never turning one or the other fully off, but rather dialing certain aspects up and down based on what’s working for your goals at any time. And most CEO’s won’t want to hear this, but it’s never just ONE THING that gets a customer to purchase. It’s typically all the things.
If you are just doing cold outbound emails or cold calls, you’re likely not getting a great return on investment, because it really should not be happening in a silo, nor being relied upon as the only touch. While a significant number of cold emails will still get deleted without even being opened, you can do other things that will make your company become the exception to this statistic. It’s a fairly new practice called Revenue Operations or RevOps.
What Is RevOps?
RevOps refers to the combination of revenue and operations as it results in a department responsible for aligning various operational functions and providing support to sales, marketing and customer service organizations.
In short, you’re aligning your marketing and sales teams to become a single revenue machine, instead of having two competing departments, creating clean hand-offs from marketing efforts into the sales teams pipeline, and into closed-won clients.
Extensive surveys and studies have shown a strong correlation between those who ensure revenue data was available across departments and the overall growth of revenue.
The Benefits of RevOps
There are many benefits of RevOps. One of the biggest benefits includes having access to revenue data that allows you to receive a full understanding of what strategies are working effectively and what areas need improvement.
According to a B2B study conducted by HubSpot and ProfitWell RevConnect, companies spend an average of 57 percent of all their total expenses on customer acquisition, encompassing sales, overhead, marketing, personnel, advertising costs and more. This spend typically influences the top-line revenue by a revenue factor of 1-2 times.
However, many companies tend to overlook the significance of investing in monetization and retention efforts (RevOps!). Expenses directed towards these categories have shown a re- markable 4-6 times more impact on revenue growth.
Signs You Might Benefit from RevOps
In order to receive the full advantage of RevOps, it is important to identify if this could benefit you and your company. Here are three signs that your business could benefit from RevOps:
- Your paid digital advertising increases revenue, but those customers don’t return.
- Your best salesperson acquires customers that cost too much in ongoing service and support (you never make it up in volume!).
- Not every customer utilizes your full-service offering, so you’re leaving money on the table.
Conclusion: Cold Outbound Prospecting Still Works!
Engaging in cold calling and sending cold emails can be an effective way of growing your business a little, or a lot, depending on the other things you are doing to augment and optimize along a potential customer’s buying journey. Great sales people will tell you that it’s never just one thing to close a deal. They’re actually quite likely to tell you that it’s due to the relationship they created with the prospect that helped convert them to the customer. With a RevOps machine running in the background, marketing can tailor their messaging based on where the prospect is in their journey and also be aware of any possible service ticket or delivery issues that are occurring at the same time.
Don’t you hate it when you get a sales call from a company that you’ve 1) worked with in the past and the person on the phone has no idea: or 2) submitted a support ticket and haven’t heard back and yet they’re trying to sell you something new? Bringing the data together increases your ability to say the right things at the right time and increases the overall success of your outbound prospecting.
- DMA. (n.d.). https://dma.org.uk/guides
- Yesware. (2022, April 5). https://www.yesware.com/blog/
- HubSpot Academy. (n.d.). https://academy.hubspot.com/lessons/ rev-ops
- 1 Bold Step. (2023, June 26). https://1boldstep.com/revops/
By Jennifer Jurgens, originally published in SBAM’s September/October 2023 issue of Focus magazine