Telephone Sales Basics for Start-ups

Everyone picks up the telephone to do business. Yet the word “telemarketing” has many negative connotations for people. However, telemarketing is merely a term for conducting business over the telephone. Whenever you pick up the phone at work to make or receive a call you are “a telemarketer”. Over the years telemarketing has evolved into the following applications:

1. Business to Consumer

2. Business to Business

Within these classifications, there are two separate functions: inbound and outbound. Inbound is generally thought of as customer service, and outbound is used for sales or surveys. CSR is telemarketing shorthand for Customer Service Representative. TSR is telemarketing shorthand for Telemarketing Sales Representative.

In order to increase response rate, many firms use a combination of direct mail and telemarketing.

Generally the telemarketing call follows the mail piece. If the client or prospect requires additional information, a follow up first class mail piece, fax or email is sent.

A soft sell works best for long term buyer -seller relationships. Each prospect call begins by letting prospects know the organization might be able to solve problems/fill needs. We then ask a series of questions to determine what their situation is and how the products can best help them. The offer is made and we ask for agreement – also known as the close. Rep’s are expected to overcome objections and show how close a match the products are to the prospect’s needs.

The steps in a sales presentation:

1. Opening

2. Offer

3. Trial Close

4. Objections

5. Close

Most Telemarketing units use a “script”, a written, planned presentation. Actually, all salespeople use planned presentations; but as no one can see the telemarketer, these can be written down. A good script is used as a guideline as opposed to a verbatim speech. The presentation should inject some of the rep’s personality and be flexible enough to personalize each call.

During the course of an “average” day a Telephone Sales Rep will:

o Dial the telephone 200 times

o Reach voice mail 80 times (out of 200)

o Reach a decision maker to make a presentation 20 times (out of 200)

Telemarketing is no longer the stepchild of company’s marketing efforts, in many cases telemarketing has become the focal point for dynamic expansion. As the cost of field sales endeavors continues to rise, more and more firms are using telemarketing to cost effectively increase their business. In 1988, US News and World Reports published a report citing 8 million telemarketing jobs by the year 2000. At a time when most telemarketing employment seemed to be part time (targeted for housewives, students and retirees)or hard sell boiler rooms, this number seemed tremendous.

Today when most telemarketing positions, particularly in the bus

Sales – Cold Calling

Out of all the wondrous facets of selling, cold calling has to rate as the single most hated of all. I have often been curious as to reason out why this is the case. I carved out my career in this world of selling on the back of the fact that I truly loved to cold call. Where others around me would spend their days schmoozing their existing clients in the vain hope of persuading one or two to increase their order, I would be consistently bringing in three, four or even five brand new orders in the same space of time.

In this article, I will take a brief look at one of the main factors that determines cold calling success.

Too Good to be True

Has anyone ever offered you something that just seemed too good to be true? If so, what did you do? Most people assume that it is too good to be true and refuse to have anything to do with it. This is because when the sales person offered it, he or she failed to understand and follow the basic principles behind the psychology of the sale.

You see the thing with people, humans, is that we have only really, in evolutionary terms, just come down from the trees. We possess a primeval inbuilt sense that alerts us to any potential danger which we tend to follow. This is because it was not too long ago that we may well have ended up getting eaten if we did not follow its guidance.

This inbuilt warning system constantly checks everything around us for any signs of danger. It has learned to identify anything that is new as potentially hazardous. All this happens at the subconscious level. We live in an advanced society, however, and our defenses often hold us back when in reality we would be better off going forward.

No thank you, you might be a hungry lion!

So what has all this got to do with sales and telesales? The answer is everything! When you speak to a complete stranger on the telephone, their inner warning system is automatically in a heightened state of awareness because they do not know who you are or what it is that you want with them. If you do not learn to manage this then all you will ever experience is rejection. That is because each persons inbuilt warning system is telling them that something about you and your call does not seem right. So the subconscious reasons to itself that it will be safer to have nothing to do with you, thank you very much.

The problem is that most people will never tell you this and so you come away from the call none the wiser. They may say any number of things to you, but they will not tell you the truth which is that inside they have been put into fight or flight mode and so they are choosing the latter. In reality, all that happened is that the sales person has neglected to reassure the prospects inner defense mechanism that there was no threat.

The first seven seconds

You may have heard it said that people make up their mind about you on the telephone in about seven seconds. I do not claim any empirical knowledge of this; however, it is abundantly clear that the reason behind it is the inner defense system. If we can reassure our prospects subconscious that we pose no threat then we stand a very good chance of getting our full presentation out, which in turn, gives us the best possible chance of securing a sale.

Steps to the Sale

So how do we combat this? The answer is simply that we meticulously adhere to the steps of the sale. These are steps that you must take in order to ensure maximum chances of success. The primary steps are all geared to getting past that inner defense mechanism. When you follow these, the prospect will normally allow you to deliver your full pitch. Of course this is not always the case, but that is another story. By understanding and following the steps of the sale we learn to reassure the potential customer that we are actually trying to help instead of harm them.

These are the initial steps:

o Rapport

We must establish a rapport with the prospect.

o Reason

We must establish a clear and valid reason for our call

o Credibility

We must establish the credibility of ourselves and our company to the prospect

A simpler way of saying this is to say that we must establish:

i. who we are,

ii. what we want, and

iii. why the prospect should deal with us.

So there you have it. Clearly, within the confines of this article, I have not been able to go into any depth at all but by just being aware of your prospect’s inner defenses, you will automatically begin to adapt your cold calls to ensure that you at least get your pitch out to them instead of having the other person just hang up on you.

Who is the Best Telephone Sales Rep?

personality or skill, luck of the territory or the ability to keep grinding out those dials? The answer lies in a careful analysis of what the sales assignment requires. It is not uncommon for a telephone sales person who has been very successful in one position to be mediocre or even fail in another.

Creating a great telephone or inside sales rep starts before the hiring process begins. Management must have a clear sense of what the position will entail. This is accomplished by considering the objective of the position and what behaviors are needed to achieve this. Ask yourselves what the person will need to do to in order to achieve their goals.

Prospecting and customer sales positions have very different emphasis. Although certain traits are shared, it can be very difficult for a customer sales person, who regularly handles repeat business, to emotionally deal with the frustrations of the prospecting process, particularly if it is a long closing cycle. Customer reps like the positive affirmations that come regularly with their job. These affirmations come from either customers who purchase with relative frequency or from the satisfaction of keeping a customer happy with their attention and service. At the same time, a rep who has spent a lot of time prospecting, may find it difficult to maintain the service orientated relationship that customer sales entails. They may look for a quick result and move on.

In addition to a higher tolerance for rejection, a prospecting project will require an emphasis on a high amount of dials. The more one is shot down, the more calls one must make.

However, it is important to note that a customer sales assignment may still require a high amount of dials. In order to increase productivity, often the easiest way to do so is to increase the number of dials each day. This means that the customer sales rep must be able to stay focused enough to achieve their sales goals. It is easy for customer sales reps to make “busy work” and hand holding fill their days while convincing themselves they are being productive. This can lull management into a false sense of security. Without sales results, however, the customer sales rep is not being effective. Remember, whether a customer sales rep or prospecting sales rep, in the end they must be accountable for measurable results.

Take stock of the selling techniques that your inside sales assignment requires. Tangibles are different from intangibles. For some, it will be simpler to sell a physical product, like a pen or a machine or a car. Although purchasing over the telephone, buyers in many cases can sample the product: see, touch, use their own senses to compliment what the sales person has been saying. In selling a service, the inside rep must be able to create the experience solely with their words over the telephone. Again, these are two different skill sets.

Another difference between prospecting and customer sales can often be found in the compensation structure. Sales management must be vigilant that they are rewarding correct behaviors.

High producing sales reps are motivated by money. They will carry out activities on the job that directly affect their income. If they don’t see a process or procedure as contributing to that, a manager will inevitably have problems with sales reps complying. Many customer sales reps are less motivated by money per se, but will want to see rewards and recognition for their work.

If you are a small company, don’t fall in love with the idea of hiring from large “name” companies. Often, these reps have been used to a level of support that you will be unable to provide. During the interview process make sure the candidate sales rep understands what working for your organization will be like. Although someone from a larger concern can bring with them ideas and a different viewpoint, if they are not willing to make changes to their office lifestyle, you may just find yourself with a disgruntled rep who will look for the first opportunity to get back to a larger firm.

A careful analysis of all these factors will help management create a profile of the experiences and traits a telephone sales person will need to succeed in your organization. So, who is the best telephone sales representative? The one who is best for your company.

Sales – Smash Your Targets

Sales is a numbers game. Period. There is no getting around this fact. If you want to be successful at all in any kind of sales environment, whether it is field sales or tele-sales, then you simply have to put the numbers in.

I was once told the story about a man that saw another man get attacked by a gang in the street. As he ran to help, he watched as the man under attack remained perfectly calm and still until one of the gang actually went to hit him. At this point he saw the man block the attack and knock two of the gang members out cold with a single spinning kick. The remaining members of the gang fled at the sight of this. As he arrived at the scene, realizing that his help was in no way needed, he courteously asked whether the man was alright. When he said he was, the observer remarked what an amazing kick that had been to knock two people out in one go. To this the other fellow responded that, in actual fact he was an expert in martial arts and that, while it may have only looked like one kick to an observer, in actual fact it was the culmination of perhaps a million kicks practiced repeatedly in readiness for a moment such as this.

The moral of this story is simple. Excellence is not a single action but an overall result of many, many actions taken to perfect a skill. This is the essence of the numbers game. We all play the same game in sales, it just so happens that some are more skilled than others through practice and perhaps a little luck. Let me explain the numbers game a little more clearly:

The Basics

Suppose that if you hit your target you will earn £40,000 per annum (roughly $80,000 U.S.D.) and you need one sale per day to hit your target. Let us further suppose that to make that sale you must make ten sales presentations over the phone, on average. Further, let us assume that to enable you to make those ten presentations, you must make, again on average, one hundred individual calls to different companies. Clearly these figures will vary depending on your industry, your product and your level of skill, however, for the time being let us work with these for the sake of illustration.

We are left with the following:

100 calls per day = 10 sales presentations

10 sales presentations = 1 sale per day

1 sale per day = £40,000 per annum

Simple. Okay, but let us take this one step further. If there are 52 weeks in a year and we are allowed 20 days holiday, then we are left with 48 working weeks. If we then subtract the number of bank holidays which usually equals 8 days, (this is for the UK), we are left with 46.4 working weeks. If we then assume a further two weeks for sickness throughout the year, we are left with a grand total of 44.4 working weeks to each calendar year. This works out at 7.6 weeks of lost selling time which equates to 38 lost sales if you do not manage this lost time properly.

So we have:

52 weeks in a year

- 4 weeks holidays

- 1.6 weeks bank holidays

- 2 weeks sickness & misc. absence

44.4 weeks selling time remaining

This may all seem like I am going a little too far but please remember that a company will generally make far more money from you and have to pay you far less money if you almost hit your targets but not quite. In each of the companies I have owned, that is exactly the way I set commission structures. I was delighted when an employee just missed their target because of all the extra commission and bonuses I did not have to pay out.

Companies may say that your targets are weekly ones but that is not the case at all. Any organization worth its salt will set its targets first of all annually and then quarterly and then monthly or weekly. This is why when I worked for a very large private healthcare provider they did not allow their sales staff any leeway over missing targets due to holidays. Staff were expected to manage their holidays and their sales so that they hit their targets no matter how much time they had off.

So let us return to our initial model. If we multiply it up a little, we see that to earn your £40,000 per annum you had to achieve one sale per day. Therefore, we can assume that what that means is that you have a target of around 260 sales per annum, (1 sale per day x 5 days per week x 52 weeks per annum).

However, in reality, your target is no longer one sale per day because now we have to divide 260 sales by 44.4 weeks and then by 5 days per week. The result of this is roughly six sales per week and so 1.2 sales per day.

This may not seem like such a big deal but what it actually means is that if you work on a basis of one sale per day and five sales per week, on average you are likely to end up short of your target at the end of the month by four sales. This is how companies profit from you. If you miss your monthly and quarterly targets, chances are that you are missing out on some pretty nice bonus and commission incentives. The company will be delighted because you are doing what they need and they are not having to pay you very much for it.

If you are one of those cynical people that does not think that it works this way then I would urge you to check out the people that are earning big money in your organisation. I guarantee you that they will run through figures like these on a regular basis. Every single successful salesperson that I have ever met, including myself, regularly check where they are in terms of their required sales figures and how much they need to do and how many calls they need to make to achieve that.

Bean Crunching

The next step is to determine what our actual figures are. It is all well and good me saying that to get one sale you need to make on hundred calls, but what if that is not the case for you. I know that I used to work on very different figures from this indeed. I usually only needed to average around ten to fifteen calls to make a single sale. Having said that, I knew many colleagues that had to make the hundred mark to even have a chance of a sale.

The way to discover your actual statistics is to simply count them up. Start by collecting some hard data. If your company can provide you with the number of calls you have made over a given period then by all mean get them out and start doing some sums to see where you are up to. If they cannot or will not provide these then you will just have to compile them yourself.

The easiest way that I have found to do this is by just sticking a post-it note to your desk and making a small mark each time you make a call. The added advantage of this is that it can give you more detailed data that a simple phone bill. You can use it for example not just to record how many calls you make but also how many decision makers you speak to and how many full presentations you make. This is invaluable information for a sales person.

By way of a slight aside here, it occurs to me that some of you may think that all this is very pedantic and merely producing figures for the sake of it. Indeed, I have been accused of this on occasion by some bosses. Yet, when they see the results I get they soon shut up about it and let me get on with it, thank you very much. The point is that one of your primary business tools is your telephone. That hunk of plastic that sits on your desk staring at you all day long can bring you great riches and happiness if you learn how to use it properly. It gives you constant feedback by way of these daily figures. Use them and be the better off for it.

Remember, even if you are the worst sales person in the world this method of selling WILL work for you. Even if it transpires that you need to make twice as many calls as your colleagues to get the same sales then what does that matter? For as long as you put in those calls, you are guaranteed, statistically speaking at least, to get those sales.

So what do you need in the way of raw data? You need several values:

o Total number of actual calls made during a specific and measured time period

o Total number of sales made during the same time period.

o Total monetary value of sales made in the period

o Total number of days worked

What you then do is simply apply the following statistical formulae:

o (Total number of sales calls) divided by (Number of days worked) = Average number of sales calls per day

o (Total monetary value of sales) divided by (Number of days worked) = Average £’s per day

o (Total number of sales) divided by (Number of days worked) = Average number of sales per day

Then simply divide the results of those, i.e. average £’s per day by the average number of sales calls per day to get the average number of £’s per call. Do the same with the average number of sales to get the average number of calls needed to get a single sale. You can go on with this process depending on the depth of data that you collect. If you have information, for example about how many full pitches you managed to make and how many actual decision makers you speak to then you can calculate how many pitches you need to make to get a single sale and so forth. All of this can be collated on a simple spreadsheet to give you regular feedback.

The point of this should be very clear. If it transpires that you usually make around 80 calls per day and get one sale per day, it does not take a genius to realize that without improving your selling skills one little bit, you can easily make one extra sale every four days if you simply increase your daily calls average to a hundred. Or, if you are this way inclined, you could make your average of five sales per week by Thursday and then take it easy on Friday. It is up to you.

The value of knowing your work input level to sales output level in terms of statistical ratios is enormous. Everyone has a comfort level. Most sales books assume that you want to be the next Bill Gates. I do not assume that. The majority of successful sales people that I have ever met were happy earning a certain level that they had determined necessary to live the lifestyle they wanted. Obviously that figure varied from person to person, but once they had achieved that they generally preferred to enjoy their lives and get to know their work colleagues or spend more time with their families than stressing out over looming sales targets. Life, in any arena, is about balance. The value of statistics in sales is that they tell you, (on average it must be stressed), what you need to do on a daily basis in terms of your own personal level of effort to achieve your goals.

You should check your statistical averages often, perhaps once a month, and always ensure that you have the required data available to do this, in terms of numbers of calls and so on. This will also help you to determine your progress in sales. The better your averages, the higher your level of skill. It is that simple.

Older posts »