Why is it that for so many people, the word “sales” conjures up an image of a smooth-talking salesman going door-to-door performing elaborate demonstrations in an attempt to sell something nobody needs or asked for?
It’s true the traditional model of face-to-face selling gets a bad rap, but those of us selling products and services today recognize that sales, in general, have come a long way toward becoming more customer-centric.
Outside sales, sales made in-person out in the field, are still a primary way of bringing in new business for companies. However, efforts to make the selling process more efficient and convenient for both seller and buyer led to the rise of inside sales, selling done remotely over the phone, with inside sales reps currently making up nearly half of the sales workforce.
The number of companies utilizing an inside sales model has been growing rapidly over the last few decades, as technology to make the job more efficient emerges and as buyers increasingly expect a more digital experience. 2019 might be the year we see inside sales tip the scales, surpassing that 50% of sales professionals and solidifying its place as the future of sales.
In modern sales teams, we often see some sort of hybrid between outside and inside sales where agents perform functions of both and specialized teams support each other’s efforts. But sales strategies aren’t one-size-fits-all, and what will work for you and your team depends on a number of factors, such as what you sell, how much you sell it for, and how your customers prefer to buy.
Let’s take a look at how outside and inside sales came to be, explore the key differences between the models, and talk about how you can determine what type of sales structure will work best in your company.
Outside sales is considered the traditional sales model, the one that conjures up that cartoonish imagery of the door-to-door salesman. Outside sales reps take advantage of face-to-face communication, traveling to meet prospects in person and make their pitch.
Before inside sales grew in popularity, outside sales reps were the breadwinners of their companies, winning large target accounts, bringing in revenue, and wielding power within their organizations. Even with the proliferation of the inside sales model, outside reps continue to lead when it comes to closing strategic enterprise accounts.
According to Hubspot, deals worked by outside sales teams tend to be 130.2% bigger than those worked by inside teams. This is attributed to the main advantage field reps have over remote sellers, their ability to leverage in-person connection to build relationships with prospects.
Because of the relational nature of this sales model, outside sales has historically been the approach favored by larger companies with higher deal values, longer sales cycles, and a more involved decision process.
And yet, outside sales reps spend almost half their time making sales remotely, 45.4% of their time to be exact, as reported in a 2017 study by Insidesales.com. This rise in field reps’ remote activity, which saw a 90% increase between 2013 and 2017, is evidence of the accelerated adoption of the inside sales model.
The rise of inside sales came about as a result of improvements in technology, specifically video conferencing and CRM platforms, which give salespeople the capability to sell remotely and automate many of their processes.
This unprecedented ability to prioritize and communicate with prospects means inside sales reps can do their jobs more productively, consistently making more dials, leaving more voicemails, sending more emails, and making more social touches than outside reps by relatively wide margins.
The inside sales model is highly effective for closing SMB deals with shorter sales cycles, as Hubspot reports teams predominantly made up of inside reps attain their quotas at a 9.8% higher rate than those with mostly outside reps. But with the right team structure and specialization, remote selling proves efficient for closing large deals, too.
For example, inside sales can be used in tandem with a specialized sales development team whose reps qualify leads and set appointments for sales. This keeps closers focused on closing deals instead of prospecting and keeps all reps in-house, allowing for higher levels of productivity and collaboration.
The benefits of the inside sales model seemingly outweigh the disadvantages as more and more organizations continue to grow their inside teams. Even the ability to form face-to-face relationships has become less of an advantage for outside sales reps, as B2B buyers become more self-sufficient in researching purchase decisions and expect a more digital buying experience.
Salesloft reported in 2013 that 75% of buyers prefer to make their purchases without ever meeting with a sales rep in person. As this trend continues to grow with steady advancement in communication technology and machine learning, the number of inside sales professionals in the workforce will continue to rise exponentially.
Looking at the key differences between outside and inside sales gives us some insight as to why the inside sales model has increased in popularity at such an exponential rate.
- Costs: The cost of utilizing an inside sales team depends on the sales technology stack in use, but 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, but add to it expenses for their car, gas, flights, dining, and equipment for product demos. Also keep in mind that outside reps, on average, require a 36% higher base salary, according to the Insidesales.com report.
- Scalability: While outside sales pros are able to cultivate meaningful business relationships by building trust face-to-face with prospects, there are limitations to how much they can accomplish on foot. Remote selling gives salespeople the ability to nurture multiple relationships at once through the use of automation, allowing them to scale their efforts as the company grows.
- Efficiency: Though the length of a sales cycle can vary depending on the buyers and offering, inside sales can make most cycles more efficient by employing a well-developed, methodical sales process. Inside sales reps can also prioritize prospects through an automated system of lead scoring, so they don’t waste time nurturing leads who are not ready to buy. Compared to inside sales, outside reps run a higher risk of allocating time and effort to relationships that won’t pay off.
Inside sales 2.0
The spread of inside sales brings with it inventive new ways to optimize the selling process and shorten sales cycles through specialization. As we briefly mentioned before, adding sales development reps to your mix is the best way to streamline long and complex sales cycles for your inside reps.
SDRs are entry-level reps who cold call from a targeted database and call warm inbound leads to qualify prospects and set appointments with the closer.
The goal of an SDR is not to sell the product, but to pitch the less intrusive ask of setting a sales meeting and to determine if there is a good fit between the lead and the offering. When the meeting rolls around, the SDR performs a warm handoff to the sales rep to provide a seamless experience for the sales-qualified lead.
Many B2B companies call this sales function appointment setting. One of its main purposes is to bridge the gap between marketing and sales by engaging with marketing-qualified leads and warming them up for a sales conversation.
Possibly the most significant advantage to having a dedicated appointment setting team is that it keeps the sales reps focused on closing deals instead of getting leads.
Salespeople shouldn’t spend their valuable time on the long process of cold calling and qualifying leads. And many closers, in an effort to attain their quota, will give up on contacts who might have ended up purchasing, before making the number of touches needed to win them over.
Closers also tend to concentrate on pitching the product instead of the more modest ask of scheduling a phone call for more information. Using SDRs to make sure prospects are sales-ready means your closers can save their effort for leads who are likely to buy.
Some other important things SDRs accomplish include:
- They can validate your database to ensure info is targeted and up-to-date by calling through it.
- They gather important information about your offering’s fit in your chosen market and what is important to your buyer persona through direct feedback.
- They use discovery questions to extract unique information about specific contacts and their organizational needs.
- They are able to achieve the necessary call cadence; a minimum of 3-4 touches is necessary for cold calling.
Because of the nature of the job, this tends to be a high turnover role and can present challenges when building and maintaining an SDR team. If this proves to be the case for your company, we’ve seen many organizations succeed by outsourcing the SDR role to simplify their internal process.
Having SDRs to cold call leads and qualify prospects can be effective for driving pipeline growth, especially for big-ticket items like B2B solutions and SaaS offerings.
For these products or services with longer sales cycles and often multiple decision makers involved, qualifying leads early on and maintaining a persistent cadence is critical.
And given the efficiency appointment setting adds to the sales process, making high-value sales while mitigating the costs of field selling by keeping your reps at their desks has never been so attainable.
Choosing between outside & inside sales
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.
A complete understanding of your target personas can help you outline key characteristics, such as how they prefer to buy. Do they expect a more digital and convenient buying experience? Or would they rather speak to a salesperson face-to-face before making a purchase?
Many companies who still rely primarily on field sales exist in industries that tend to do things the way they’ve always been done. However, we don’t see outside sales completely disappearing anytime soon.
Inside sales and outside sales both have their place in the business world, and it can be a challenge to decide which model to use. As sales continues to evolve, we’ll see the innovative ways these two models differ and coincide. But there’s no denying that inside sales is on the rise.