19 September 2013

Modern inside sales boosts B2B business

Too frequently occurring situation: you are back from sales trip, with empty hands, results zero or negligible. The customer did not need your product, he is still in very early phases of his purchasing process, costs of dealing with a potential customer far exceed anticipated revenues - there are multiple reasons. Modern inside sales methods and tools are transforming the way, how B2B businesses are operating and boosting their sales. Companies should seriously consider deploying them as part of their overall sales activities.

Modern inside sales

Modern inside sales is about professional B2B selling of medium- to high-valued goods or services, where customers are not met face to face but remotely, using various communication tools. These sales conversations cannot be scripted, and it typically requires multiple contacts before the agreement is reached. In parallel with the term inside sales, we can also use remote or virtual sales. Traditional field sales, or outside sales, is often seen as the opposite of inside sales.

Inside sales image has been dominated by telemarketing, i.e. often hastily educated people selling low-value goods or services to consumers, using ready-made scripts and trying to close a deal in one call. Telemarketing is outside of this post focus.

Insidesales.com estimates that in the United States, remote sales already employs more sellers (2.34 million) than traditional field sales - and the growth continues. The same study found that also field sales force uses remote selling in their work: 24% of their time is spent on inside sales, 35% on outside sales and 15% on customer related travelling. Inside sales force, in turn, uses 63% of the working time by doing remote sales and 5% by field selling. Growth of inside sales thus means that both time spent on inside sales and number of inside sales employees are growing.

This post focuses on remote sales and in particular on its use in demanding B2B sales and marketing cases. Inspired by successful references, numerous B2B companies are investing large sums of money to build inside sales capabilities and resources. Next section deals with drivers behind popularity of this phenomenon.

Drivers of inside sales growth

General cost awareness favours the growth of inside sales, key drivers being increase in the time used for selling, lower travelling costs, lower sales staff salaries and increasing the efficiency by using the most appropriate tools.

Remote selling professionals use relatively more time to actual sales than their field sales counterparts, due to time needed for customer travel by the latter. Also, travel costs are a major cost item, especially with foreign customer accounts. Median salary in inside sales jobs in the United States is less than 70 per cent of that of field sales, and also in demanding B2B sales, differences are significant. In Europe the situation is similar. It is widely alleged that inside sales is growing due to these wage differentials, but probably the greatest cost benefits are brought by always being able to use the most appropriate sales methods and tools.

Globalised markets accelerate inside sales growth by making sourcing and sales context global, by harmonising markets and by tightening of competition.

Globalisation of sourcing and purchasing processes - search and comparison of solutions and acquiring them worldwide, forgetting borders - has lowered the threshold to use electronic communications means, especially in the early stages of buying process. Vendor companies have been forced to follow the trend and their customers, only very few B2B players can count on serving only domestic clients. Markets that previously have been local are also becoming quite uniform: same technologies, standards and processes are in place across industries, globally, making it easier to present and offer products through remote sales. Globalisation has also brought competitive pressures, favouring inside sales: for example, a company might be competing not only with traditional local competitors, but also with large international companies, emerging country businesses and new players seeking to disrupt the industry through innovations and business model changes.

New communication and information technologies are the practical tool to enable inside sales. Also, buyers´ increased ability and willingness to use these technologies are paving the way for the growth of remote selling.

Improved communication means are closing the gap between remote selling and face to face interaction, essential when selling demanding B2B products. Besides telephony and e-mail, new technologies, such as conference and video calls, instant messaging and other social media tools have been taken into use. Internet and extranets, again, are a superior way to share up-to-date information, ranging from basic product information to customer-specific proposals. On top of these communication and information technologies, there are also versatile tools available that assist expanding inside sales: e.g. sales configurators make it possible to define features of more and more demanding products remotely, either by customers themselves or in cooperation with the seller. To support remote selling, there are also a number of integrated software packages available, e.g. Salesforce.com, Insidesales.com and Lead Desk offerings.

How to use inside sales

Most B2B companies use both field and remote selling in their sales processes. The optimal division varies, depending on, inter alia, nature of the product or service, distribution strategy, marketing and sales processes, as well as level of company globalisation. Next we shall discuss various ways to organise inside sales for demanding B2B business; real implementation can, of course, be a combination of these.

Product or service based approach: Remote sales is used to sell offerings, where customer risk is relatively small. Typically, these do not require on-site assessments or definition of delivery content. Also modular, customisable solutions can be sold remotely, provided that interaction can be supported by sales configurators and relevant guidelines. Complex solutions, often requiring consultative and value selling approach or in-depth customisation, favour meeting customers face to face. When selling services, the more standardised they are, the better for inside sales.

Phase of customer engagement process: Remote selling methods are extremely well suited to verify and crystallise customer needs. After this field sales can continue, having better quality cases to work on. Also, up-selling or cross-selling of goods or services can be conveniently done remotely.

Market segment approach: Small and medium-sized enterprises, whose purchases are not large enough and the buying process is relatively simple, are often taken care of with inside sales. Customers with large potential, complex needs, complicated buying process and involvement of large amount of people in the process, require face to face interaction. Many vendors use channel partners to handle customers with smaller potential and then allocate inside sales to support distributors and resellers. When planning, how to approach an individual company, a vendor needs to actively listen to its customers: a client might favour, for operational or other reasons, different kind of approach than planned by the vendor. For example, a large potential customer may object face to face meetings and prefer buying online for cost and resource saving reasons.

Geography based approach: Remotely located customers that are non-strategic are typically inside sales targets. When a company is expanding internationally, a new country can be first served through remote selling, before setting up a local office.

Some execution challenges

Finally, a few words about the challenges that a company often faces, when it begins to use inside sales. Organisation, skills development and the role of outsourcing are among the most important ones.

When a company is defining inside sales responsibilities, practises and the roles of sales people in the new operating model, old field sales traditions and bias will inevitably start to affect. For example, client meetings and associated travel, new methods and tools, as well as reward and recognition are topics that cause strong reactions, either not letting go or rejecting ones. This is why implementation should be planned well, by engaging and motivating existing staff, as well as reasoning any changes thoroughly.

Skill and competence development is absolutely essential to achieve results. Persons doing inside sales, whether they do it on full-time or part-time basis, need to learn the new processes and tools, besides understanding the strategic premises of the new operating approach. Especially, when demanding B2B solutions are concerned, tools as such are not enough: there should be thought out guidelines on how to effectively use them to convince customers and to close deals. Also field sales skills must be further developed: all need to understand, what are the roles of inside and outside sales, and on the other hand, the field force needs to be capable of taking more consultative sales approach, away from routine sharing of information.

There are potential outsourcing partners that can assist in inside sales, too. Often their core expertise, however, is in more traditional telemarketing. In B2B sales, relatively simple products can best be outsourced, but the more demanding products are, the bigger organisation and skills development challenges.


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