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This post was originally published in January 2019 and has been updated for accuracy and comprehensiveness.
How is it that we can be in the year 2024, and the word “sales” still conjures up an image in peoples’ minds of a slick, smooth-talking snake oil salesman going door-to-door performing elaborate demonstrations in an attempt to sell you a product you neither needed nor asked for?
While it is true that the traditional model of face-to-face selling has historically gotten a bad rap, sales reps selling products and services today understand that the practice of sales, in general, has come a long way from being a distrusted profession to one that is becoming far more customer-centric.
Outside sales, the traditional form of sales made in-person and out in the field, are still seen as a primary means of bringing in new customers for businesses. Interestingly enough, efforts to make the outside selling process more streamlined and convenient for both the seller and the buyer directly led to the rise of inside sales – selling done remotely over the phone. Today, inside sales reps currently comprise almost half of all sales professionals in the workforce. How long before they reach parity with outside sales?
The business world has seen a rapid increase in the number of companies choosing to use an inside sales model over the last few decades – a trend that doesn’t appear to be slowing. As automation and other process-improving technologies emerge to make the job more efficient and buyers increasingly expect a more digital experience, inside sales continue to gain ground. Now, in 2024, we just might see inside sales reps tip the scales and finally surpass that 50% threshold of sales professionals and solidify their place as the future of sales.
In more modern, future-focused sales teams, we typically see a hybrid model between both outside and inside sales where talented agents perform the functions of both roles and specialized teams provide support to each other’s sales efforts. Now, you might be thinking this model sounds perfect – but is it the perfect fit for your business? It just might be, but we should stress that sales strategies are never one-size-fits-all. What will work for you and your team depends on several factors, such as what you sell, how it’s sold for, and what your customers’ preferences are when it comes to purchasing your product.
Let’s explore how outside and inside sales came to be, define the key differences between the two sales models, and discuss how you can determine what type of sales structure is the best fit for your business.
Long considered the de facto form of sales, outside sales is the traditional sales model that also unfortunately evokes the cartoonish depiction of the dubious door-to-door salesman. That said, there’s a reason it’s been the traditional model for so long, as outside sales reps are able to take advantage of face-to-face communication by traveling to meet prospects in person to make their pitch.
Before the proliferation of inside sales, outside sales reps were always historically the breadwinners of their respective companies, landing large target accounts, bringing in revenue, and holding considerable influence within their organizations. Even with the rise in popularity of the inside sales model, outside sales reps continue to come out on top in terms of closing strategic (more lucrative) enterprise accounts.
We’re not kidding about the average value of outside sales deals. According to Hubspot, deals worked by outside sales teams are typically 130.2% bigger than those worked by inside sales teams. This all goes back to the main advantage outside sales reps have over remote sellers, the one that’s made it the traditional model for decades – their ability to leverage in-person connections to build mutually beneficial relationships with prospects.
Due to the relational structure of this sales model, outside sales has historically been an approach heavily favored by larger organizations with higher deal values, longer sales cycles, and a more involved decision-making process.
Despite all this, you might be shocked to discover that outside sales reps, prided for their face-to-face interactions and relationship-building, still spend nearly half of their time making sales remotely – 45.4% of their time to be precise, according to a 2017 study by Xant. This increase in remote activity by outside sales reps saw a 90% increase between 2013 and 2017 – clear evidence that adoption of the inside sales model has drastically accelerated in recent years.
The rise of inside sales teams came as a direct result of technological advancement, specifically video conferencing and CRM platforms. These not only gave salespeople the capability to sell remotely but they also automated and streamlined many sales processes.
This unprecedented new ability to prioritize and communicate with prospects allows inside sales reps to do their jobs more productively, consistently make more dials, leave more voicemails, send more emails, and make more crucial social touches than outside reps by fairly wide margin.
The inside sales model is also highly effective when it comes to closing SMB deals with shorter sales cycles. In fact, Hubspot reports sales teams predominantly comprised of inside sales reps meet their quotas at a 9.8% higher rate than teams made up mostly of outside sales reps. However, with the right specializations and team structure in place, remote sales prove efficient and effective for closing large deals as well.
As an example, an inside sales team can be used in tandem with a specialized sales development team whose duty is specifically to qualify leads and set appointments for sales. With this structure, your closers can stay focused on closing deals instead of prospecting them. Plus, this way all reps are kept in-house, allowing for higher levels of productivity and collaboration.
On their face, it would appear the benefits of the inside sales model clearly outweigh the drawbacks as more and more companies continue to scale their inside sales teams. What’s more, even the ability to form face-to-face relationships is far less of an advantage for outside sales reps, as B2B buyers have become far more self-sufficient in recent years. The vast majority now research their purchase decisions before ever speaking to a sales rep, and they expect a far more digital buying experience.
In fact, Salesloft reported in 2013 that 75% of buyers prefer to make their purchases without meeting with a sales rep in person at all. With steady advancements in communication technology, automation, and machine learning, this trend can only continue to grow – with the number of inside sales professionals in the workforce growing exponentially along with it.
Taking a look at the key differences between outside and inside sales gives us direct insight as to why the inside sales model has experienced such an exponential increase in popularity.
The cost of using an inside sales team depends on the sales technology stack being used. It typically includes a CRM platform, phone applications, various other software subscriptions, and the hardware they run on.
These costs apply to outside sales teams as well, in addition to uniquely outside expenses like transportation, gas, air travel, dining, or equipment for product demos. Costs are an issue when it comes to compensation as well, with outside reps, on average, requiring a 36% higher base salary than inside reps, according to the same Xant report.
While outside sales pros try to set themselves apart with their ability to cultivate meaningful business relationships by building trust with their prospects face-to-face, there are clear limitations to how much any one rep can accomplish on foot.
Conversely, remote selling gives inside salespeople the ability to nurture multiple relationships simultaneously through the use of automation, allowing them to seamlessly scale their efforts as the company grows.
Though the length of a sales cycle can vary widely depending on the buyers and the product or service being offered, inside sales can make most cycles more efficient by employing a well-developed, methodical sales process.
Inside sales reps also have the ability to prioritize prospects through an automated system of lead scoring. In doing so, they don’t waste vital time nurturing leads who are not ready to buy. Compared to the experience of inside sales, outside sales reps typically run a much higher risk of applying significant time and effort to prospect relationships that don’t end up leading to a deal.
The increase in popularity of inside sales also facilitated the spread of inventive new ways to optimize the selling process and shorten sales cycles through specialization. As we mentioned before, adding sales development reps (SDRs) to your sales operations is the best way to streamline long, complex sales cycles for your inside sales reps.
If you’re not familiar with SDRs, they are entry-level reps who make cold calls from a targeted database. They also call warm inbound leads to qualify prospects and set appointments with the closer.
The main goal of an SDR isn’t to sell a product. Their focus is to pitch the much less intrusive request of setting a sales appointment and to determine if the lead is a good fit for your company’s offering. When the sales meeting rolls around, the SDR then performs a warm handoff to the sales rep. In this way, your sales team can provide a seamless experience to the sales-qualified lead.
Many B2B organizations refer to this sales function as appointment setting. One of its main purposes is to unify the efforts of your sales and marketing teams by engaging with marketing-qualified leads (MQLs) and warming them up for a sales conversation.
As mentioned before, possibly the most significant advantage of having a dedicated appointment setting team is that it keeps the sales reps focused on closing deals instead of arduously prospecting for leads.
After all, your salespeople shouldn’t spend their valuable time on the long process of cold calling and qualifying leads. In fact, it can often lead to further problems. For example, many closers, in an effort to meet their quota, will give up on contacts (who might have ended up purchasing) before they’ve even made the number of touches required to win them over.
Closers also tend to concentrate on pitching the specific product or service instead of making the more modest request to schedule a phone call for additional information. Using SDRs for this part of the process ensures that prospects are sales-ready – allowing your closers to save their efforts for leads who are actually likely to buy.
Unfortunately, due to the nature of the job, the SDR role tends to have a high turnover rate which obviously presents a significant challenge when building and maintaining an SDR team. There are alternatives though. If your company is struggling to build or maintain its own SDR team, we’ve seen many organizations succeed by outsourcing the SDR role to simplify their internal process.
Using SDRs to cold call leads and qualify prospects can also be highly effective for driving pipeline growth, especially for big-ticket items like B2B solutions and SaaS offerings.
When products or services have longer sales cycles and multiple decision makers are involved, qualifying leads early on and maintaining a persistent cadence is critical.
Given the efficiency appointment setting adds to the entire sales process, it’s never been more possible to be able to make high-value sales while mitigating the costs of outside selling by having your sales reps make deals at their desks.
Learn what it takes to identify prospects, get in touch with decision-makers, and set more meetings for your sales reps.
So how can you determine if outside sales or inside sales is the right model for your company? It starts with an in-depth look at your target buyer persona and how they typically make their purchases.
An in-depth understanding of your target personas will help you greatly in outlining key characteristics like how they prefer to buy. It also helps to answer other important questions about your prospects. Are they one of the 75% of individuals who expect a more convenient, digital buying experience? Or are they one of the 25% who would rather speak to a salesperson face-to-face before making a purchase?
Typically, companies that still rely heavily on field sales exist in industries where things have historically always been done the same way. Given that fact, we don’t see outside sales completely disappearing anytime soon.
There is no one-size-fits-all sales model for every business. Inside sales and outside sales both clearly deserve their place in the business world, so it can be a real challenge to decide which model is right for your enterprise. As the way we conduct and conceptualize sales continues to change, we’re sure we will start to see even more innovative ways in which these two models diverge and converge. One thing that can’t be denied, is that inside sales are on the rise and continue to enjoy an upward trajectory.
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