Why Inside Sales is Changing the Industry and Turning Traditional Sales on Its Head

Posted on 21 Jun
inside sales

Inside sales is changing the way that companies sell to prospects. In recent years, we have seen rapid growth in the number of inside sales jobs, far outpacing traditional field salespeople. While traditional sales roles still make up over 70% of the sales workforce in North America, this rapid shift could change the balance in the coming years.

A recent study showed that 46% of Vice President of Sales reported a shift away from traditional sales models toward inside sales, compared to only 21% going the opposite way. Of course, that doesn’t mean that traditional outside sales positions are going anywhere. There is always going to be a need for those positions. But the trend is clear — as companies have more tech solutions to help them bridge the gap, and customers become more comfortable using technology to communicate and buy products — inside sales will continue to increase its relevance.

At its heart, inside sales is all about relationships. Sure, you aren’t meeting up for the fancy dinner and a round of golf like you might imagine salespeople do when closing new sales — but the digital wall between inside sales reps and customers encourages increased focus on relationship building and nurturing.

By why? What is the perfect storm that has led to an industry that employs more than 60 million sales reps consultants worldwide to shift so quickly? There are a number of reasons and advancements over the last decade that have led to this:

Inside Sales is More Cost-Efficient

Sales VPs are under immense pressure to increase sales while spending less money. In this study that we mentioned earlier, it was found that inside sales teams generate a new customer at 40-90% less cost than a traditional field sales rep.

There are a number of reasons for this, but the lack of traveling expenses and in-person meetings do play a large role. Inside sales reps close deals with their keyboard and phone, not expensive dinners and cigar lounges. One report stated that the average cost of an inside sales meeting typically fell in the $25-$75 range, while traditional field sales calls usually cost between $215-$400 per meeting. That’s a huge difference.

There is also a difference in the average salaries of inside sales reps and field sales reps. Let’s take a look at the data on Monster.com:

Inside Sales Reps Average Salary:

inside sales salary

Field Sales Reps Average Salary:

field sales rep salary

Inside sales reps are paid nearly $5,000 per year less on average, with a lower salary ceiling. Companies are always looking for ways to be more cost-efficient. When you frame the shift toward inside sales in that light, the changes that we have seen start to make a lot of sense.

Tech Solutions Have Made Relationship Management Feasible

Inside sales as we know it today wasn’t always viable. Over the last decade, we have seen a variety of tech advancements pave the way for the inside sales boom.

In previous decades, those face-to-face meetings were required to B2B deals. Today, an inside sales rep can hop on Skype, Uberconference, or any number of apps to speak directly to prospects. Additionally, sales and customer relationship management software allow sales reps to juggle more sales relationships at any given time, with higher levels of effectiveness in each interaction.

A few of the technologies that have paved the way for the change in the sales landscape include:

Video Conferencing

Sales reps can hop on a video conferencing app whenever it is convenient and build rapport with their prospects. Video conferencing software gave inside sales reps an avenue for closing deals, that wasn’t audio-only, without leaving the office. It’s a boon to efficiency. Sales reps can simply take more calls and more meetings with prospects in inside sales than they can using more traditional sales strategies.

Text Messaging & Email

Text messaging and email have really paved the way for the inside sales boom. Sales reps can stay in constant communication with prospects, delivering sales collateral and nurturing materials that further the relationship with minimal time investment. Both text messaging and email lend well to automation, removing the sales rep from physically having to insert themselves into every interaction with a prospect.

The public’s adoption of these technologies has played a large role in their usage in the sales process. Customers are comfortable receiving sales materials through these mediums today, but just a few years ago that may not have been the case. Today, customers enjoy the convenience that these channels allow.

CRM Solutions & Sales Tools

Perhaps more than any other technology, the prominence of customer relationship management (CRM) solutions have played a key role in the growth of inside sales. The ability to effectively track and monitor interactions with every prospect allows sales reps to maintain relationships with more prospects at any given time.

Sales tools have also helped with the adoption of inside sales strategies. The ability to automatically place calls and send messages from inside a sales dashboard is a game changer. Sales reps are able to capitalize on more opportunities. Built-in calling features give reps more control over their relationships. CRM systems do most of the relationship monitoring heavy lifting, while reps can focus on closing deals.

Buyers More Comfortable with Remote Collaboration

Using these technologies and channels wouldn’t be all that helpful if prospects were not willing to use these channels to communicate and collaborate with salespeople. The adoption of these technologies has played the biggest role in the inside sales revolution.

Today, customers are more willing to interact with sales reps through video conferencing software, text messages, and email when closing B2B deals. Without that familiarity, the face-to-face meetings would still be a requirement.

Better Coaching and Development

Inside sales operations allow for better coaching and development of skills. In traditional sales teams, sales reps spend a lot of time out of the office taking meetings. When most of the selling takes place in the office, salespeople are able to bounce ideas off of each other to improve and spend more time with their sales leaders to sharpen their skills.

Managers also have much more control and insight into their teams in inside sales. CRM and sales tools track all of our interactions with customers, allowing management to break down performance and identify areas for improvement more easily. In traditional sales roles, sales reps are expected to self-report their interactions, and many conversations don’t have an official record to analyze.

Flexibility

Inside sales teams have a lot of flexibility compared to traditional sales teams. Because the cost per meeting is lower, inside sales teams have more room in their budgets for experimentation and split testing approaches.

With the help of sales tools, they are able to maintain relationships with more prospects, allowing for sales reps to specialize more easily. Many inside sales teams split their salespeople into segmented groups, often by industry. They may hire for specialized positions, such as a sales development rep. Allowing your sales reps to specialize helps them to really understand their customer segment and speak to their biggest problems in their sales conversations. This freedom and flexibility leads to increased conversion rates and more engaged customers.

Improved Alignment

The transparency provided by today’s software helps to improve alignment and transparency in sales teams. Team leaders have the ability to track and analyze every step that a sales rep takes. Every new contact, missed call, text message, and voicemail is tracked. Having access to this data gives inside sales leaders the ability to have a true top-down view of their operations.

This is Just the Beginning

Inside sales has caught fire over the course of the last half-decade, fueled by a wealth of software and customer management solutions, along with the changing behavior of B2B customers. As a result, sales teams have adjusted. Today sales reps spend more time researching and providing value to prospects, and less time in expensive face-to-face meetings.

This evolution is evident in the stats. More companies are shifting their focus toward inside sales, particularly in tech industries where customers will have a familiarity with the tech and tools required to communicate and engage with inside sales reps. While field sales will always have its place, we are likely to see the inside sales industry continue to grow at a rapid pace over the course of the next few years.

 

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