Sales Prospecting Perspectives

My friend Tom runs an inside team for a software company in Boston. He gave me a call the other day asking for my opinion on his compensation package for his inside sales reps. We both compensate our inside sales reps based on performance, but Tom sees performance very differently than I do. Tom pays his reps by the number of opportunities they pass on a monthly basis. The more appointments you set for the outside team, the more money you get. Every time a sales rep has a conversation with someone you passed, the little cash register noise goes off in your head. I hear this from a lot of people that run inside sales teams.

The main issue that I have with the compensation model is that it incents the wrong kind of behavior. Finding someone that will listen to a sales rep for 15 minutes is relatively easy. I know personally that I have been called enough times by certain inside teams that I will take an appointment with a sales rep just to keep the inside rep from calling me back, even though I have no intention of buying or even keeping the appointment.

So how do you keep your inside sales reps from setting your sales team up with fruitless appointments? The answer is simple: stop paying them to do so! I’ll admit if I were in their place I would do the same exact thing. They are being motivated to find meetings when they should be motivated to find actionable sales opportunities. In lieu of paying your inside sales rep for every appointment they set, try paying them based on the number of successful appointments that take place. You can judge this by using feedback surveys. The feedback survey is a great way to compensate your inside rep as well as keep track on the effectiveness of your outside team.

After a sales rep has a discovery call or introductory meeting that was set up by your inside sales team, send them a quick email. The email is going to gauge the quality of the opportunity sent. I list 3 questions that the sales rep has to reply to:

1. Did the meeting happen?
2. Was all the information given to you from the inside sales rep accurate and up the specifications agreed on?
3. Is this call moving into a next step?

If the answers to the first 2 questions are “Yes”, the inside rep should get credit for passing a good opportunity. If your sales team is working well they should be able to convert 80% of those into a next step. If you find that you are getting answered “No” to a particular question consistently on the feedback surveys, then you have something to work on. Here is how I interpret the unfortunate “No” based responses.

1 – Did the meeting happen? If the calls aren’t happening, you have to look at how interested the prospects really were. No shows happen when inside reps don’t fully qualify and don’t pique the interest of the prospect. I find this happens more with inside sales reps that are compensated based on the number of leads they pass. As I said, If you tell a rep that every time they pass an opportunity, they will get (x) dollars, they will pass anyone that hits the bare minimum requirements in order to score the lead and get paid. It’s very pavlovian in nature: book a time, get some money, book a time, get some money, hit the red button, get a banana, little bell rings, time to eat…. Of course there is always going to be a drop off and some people won’t show for a meeting. If you have more than a 20% no show rate, you will want to look into the pitch and how it is being delivered to ensure the prospects are being qualified properly

2 – Was all the information given to you from the inside rep accurate and up the specifications agreed on? There should be questions that both the inside and outside sales reps agree need to be answered before they move to a sales call. I wouldn’t suggest getting too in depth with these. Contain them to questions such as, “Does the prospect have a problem we can solve, is there an active initiative for the prospect to solve this problem, does the prospect have the right characteristics to purchase from us? (number of users, revenue, locations, etc…)” IF the inside sales team is gathering this information on all opportunities, you should expect at least 70% of the opportunities to move forward into the next step of your sales process.

3 – Is this call moving into a next step? I talked about this in my last point, but if the first 2 questions are answered in the affirmative, the last one comes down to the sales team’s performance. If the prospects are showing up for meetings and they have all of the qualification they agreed they needed, then they are responsible for moving the opportunities to a next step. We currently have an average of 80% of our “leads” moving into a next step. That is across multiple product lines and industries. I would say anything under 70% should be alarming.

This is how I use feedback surveys to motivate my inside sales team to pass quality opportunities to sales and to ensure those quality opportunities are being followed up with a strong sales effort. It would be interesting to hear of any other tools that people are using to do the same.