I still get in heated discussions with commercial sales consultants who will defend cold calls until the end; after all, they started their careers cold calling and it was how they built their business. I am not totally against cold calling, but that does not mean that cold calling remains the best method to grow sales. In fact, there is some pretty good evidence that there are more effective ways to generate leads and sales. Unfortunately, much of the commercial vehicle sales industry continues to over-rely on cold calling, so today we’re taking a closer look at cold calls and the real ways to make profitable connections.
When researching cold calls, I found two university studies. The first one done several years ago, by the Kenan-Flagler Business School at the University of North Carolina concluded that 4 out of 5 business-to-business decision makers in the United States, 80% would definitely not buy as a direct result of cold calling. More recent research was done by Baylor University at the Keller Research Center in Texas. The study was based on a group of 50 experienced and qualified sales professionals who made a total of 6,264 phone based cold calls over a two-week period. The results?
- 72% of the calls were rejections, people who said no or just hung up. Remember these calls were to businesses.
- 28% of the calls were judged as productive. These are people who did not hang up, showed some interest, gave a referral or asked to be called back.
- Most of the 6,264 phone calls were additional attempts to sell the 1,774 (28%) of positive prospects.
- Of the total 1,774 prospects were showed positive responses resulted in 19 appointments. That’s 19 appointments out of 6,264 telephone calls!
- That’s a success rate of .3% just to get an appointment or 7.4 hours of calling to get one appointment.
It gets better in person, but only slightly. Here are the facts:
- Just dropping in to speak with busy business owner and expecting to be seen is rude and inconsiderate.
- You will only see 1 out of 20 decision makers on face to face cold calling.
- When you drop by and leave your card you give the business owner a warning and the ability to tell the gatekeeper to block you on additional attempts.
- You don’t have the time to make cold calls where you don’t see a decision maker.
If all this is true, why are so many salespeople determined to make cold calling their go-to sales strategy? Here are the reasons:
- It’s easy! It takes no preparation, no plan, and you don’t even have to know what you are going to say.
- It feels productive. It is great to be able to say you made 15 sales calls in a day! What a workhorse!
- It gives the illusion that you are working hard (you are, but you are not working very smart).
- When you do see a decision maker or make a sale it feels great! You put out an incredible amount of effort and got a win! That reinforces that cold calling works, however unproductive it was as a whole.
- Management admires your effort… at first. Then when they see very few actual sales, the doubt and frustration sets in. Start looking for another job.
I love the scene out of “Dumb and Dumber” where Jim Carrey asks an attractive young woman if he has a chance to win her romantically. Here answer is “one in a million.” Jim Carrey’s character excitedly shouts “so you’re telling’ me there’s a chance!” Well, that’s how some people feel about cold calling; however minuscule, at least there’s a chance.
I am proud that our training and sales system is so effective at generating warm leads that the sales consultants we train should never have to make a cold call again. In our next article, I will go over the many ways to get appointments and a method we use to get endless quality referrals, guaranteed! It’s time to come out of the cold. Trust me, warm is better!
About Ken Taylor:
Ken Taylor’s training, consulting, and coaching have been used on individual, regional, and national business levels to achieve ultimate success! Known as an industry leader and as “America’s Corporate & Personal Coach,” Ken has consulted for companies like General Electric, General Motors, FCA, Ford, Commercial Truck Trader, and Equipment Trader.