Prospecting - What do you use?

Snowboy

There are so many types of prospecting - What form do you use primarily in order to achieve your results in Business Development?

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Snowboy
I've come to believe; all my past frustrations were actually laying the foundation for understandings that have created the new level of living I now enjoy.

Gunner

I think that moving with the times calls for using the most up to date technology. What is more up to date then Email in order to correspond.

Good Poll

AZBroker

Referrals and Cold Calling have worked great in our market for years.

EmmaC

Referals without a doubt.

Good poll

Snowboy

Gunner - Agreed. Email is certainly a way of making sure you reach the client but it worries me that it is palmed off like Junk Email (any thoughts on that?)

Snowboy

Thanks for your Reply AZBroker. I agree with Referrals however IMO Cold Calling is dead - Does this really work for you? What industry are you in and what sought of Cold Calling do you do?

Cheers.

Snowboy

I agree with you EmmaC

AZBroker

I work in real estate, cold call sellers and yes cold calling really does work for me. What has lead you to decide that cold calling is dead?

pmccord

With most of the salespeople I train and certainly with the vast majority of my coaching clients, the complaint about cold calling isn't that it doesn't work, it's that the return in investment is so small that it isn't viable long-term.

In most industries if you sit on the phone long enough, you'll find people to have appointments with. The problem is if you have to sit on the phone 5 hours a day, 5 days a week to get 5 or 6 or 7 appointments, you're spending a huge amount of time to acquire one prospect. If you generate 7 appointments during that week, it has taken 4 hours to generate one appointment. If your time is worth say $20 an hour at a minimum, that lead has cost you $80. If you only get 5 leads, then each lead is costing $100. That's an expensive lead.

If your closing ratio is 50%, that customer cost $160 if you get 7 appointments (assuming, of course, there are no cancellations, no-shows, etc and that you actually get to meet with all 7 prospects). Plus you have to factor in the time to meet with the prospect, the costs associated with your marketing materials, gas, etc. That new customer may cost $250 to $300 or more, maybe much more. If your commission on that new customer is say $600, you've actually made $300. And that's assuming your time is only worth $20 per hour (that works out to an income of about $40,000 per year). If your time is more valuable, the cost per lead is more expensive. And we haven't taken into consideration the time to find the people to call. Another expense, more hours invested.

If it isn't a one-time sale and you have to make multiple contacts and trips, the costs continue to increase.

Cold calling isn't dead. It is simply inefficient for most, not all, salespeople. You can certainly get prospects and eventually clients. There are simply more efficient ways to get them than cold calling.

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Paul McCord
Best-selling author, Speaker, Sales Trainer, Management Consultant
Power Selling

bluenote

I use direct mail, cold calling and referrals. All three round out my marketing plan.

In my industry, which is a one call telephone sale, direct mail has been the standard and I have managed a healthy 2.2% national avg. return. These in my hand, hot leads, cost me approx. $40 each.

This past month I hired on a telemarketing company to cold call my targeted prospects for my lead generation. The results have been astronomical! Even with jobbing out the calls, the cost is 1/3 of what I spend on my mailing and the return is almost 8x what my dm yields me.

I still mail to prospects with annual sales of more than 5 million and cold call the small guys.

Direct mail- 2.2% return. $40 per lead. 30-50% sales closing ratio.

Cold calling- 15% return. $1.60 per lead. 15-20% sales closing ratio.

I shoot for referrals from everyone I talk with (I usually get at least one - sometimes up to three). These referrals do not cost me a dime and yield me approximately the same sales closing ratio as my direct mail does.

I'm still ironing out the details as I've just begun the cold calling campaign but it has proven very successful thus far.

I strongly suggest outsourcing your cold calling as I have. I simply supply them with the calling list, the script and cut them the check. One week later I've got several hundred leads in my hand and not taking a minute of my time.

This new cold calling campaign is so cost effective that it has allowed me to plan my expansion of building a sales team.

In the past year and a half I have taken my start up company from a spare bedroom home office to my present small 140 sq. ft. executive suite to now looking at a 1600 sq. ft office condo with plans of an 8 person sales staff. I project to have these reps hired, trained and selling by the end of September.

Direct mail works, cold calling works, referrals work etc... you need to find what balance works best for your task at hand.

Bottom line... Get your name out there, get in front of your prospects and close 'em