The Taber Report on Telesales/Telemarketing

Telesales. Telemarketing. Inside Sales. What could be more tactical, more of a backwater?

Most people think this way. But what other business process is staffed mainly with junior people, yet is critical enough to cause the demise of a VP in 6 months, and the CEO in a year? Maybe it’s worth a bit of your time after all.

Telesales/Telemarketing: the linchpin

Take-Aways Marketing knows how to mass- produce low-grade leads. Sales Reps want prospects that are deeply interested and closable. There’s a huge gap here. The process of lead cultivation and enrichment should not be left to either of them. The organization in-between — sometimes called telesales, sometimes telemarketing, sometimes inside sales — is where this refinement should happen. These folks need to have tools and training, but they also must have native talent for phone and email communication. You want equal parts persuasiveness and persistence. Measure the right things: conversion rates, length of queues, number of meetings, and number of sales cycles started. Get beyond number of dials as soon as you can: if you’re stuck with problems there, you’ll never get to excellence. Best Practices Have — and enforce the use of — standard terminology for leads and pipeline stages across your company. Embed these in the way your SFA system works. Be dead serious about qualification: it’s almost impossible to qualify too hard. Make sure that the qualification criteria are realistic, and modify them if you find your sales reps actually use a different set of criteria to spend their time. Avoid cherry picking behavior. Know that this is a sign of bad qualification criteria or a lack of sales discipline. Align incentives for Marketing, Telemarketing / Telesales / ISRs, and Sales reps. The goal is to have unified goals and coherent behaviors. Be willing to grow your Telemarketing / Telesales / ISRs. They’re inexpensive — why not have an inside person for every two reps, or even more than that? Have all your Telemarketing / Telesales / ISRs in one location (HQ) for each country you operate in.. Manage them tightly, but make sure every Sales Rep feels they are working for them.

You’ll notice I said “business process” in the previous paragraph. Marketing, telesales/telemarketing, and Sales are part of the same business process: revenue generation. As I’ve written before (3 separate links there), it’s completely appropriate that they not report to the same VP, but it’s all too common that they are committing the sin of not working together.

Marketing works furiously to create what they call leads. If the metrics are too simplistic (fairly often), the incentive system will reward creation of lots of “leads” that are very low quality. They can site industry statistics that 85% of those leads will buy from someone in a year. Marketers say, “mission accomplished” once they hit their number.

Meanwhile, over in Sales, people quickly discover that the “leads” aren’t very hot. So they cherry- pick what look to be the most interesting ones. The industry average is about 90% of the leads are never touched. Some nasty side effects occur:

• Marketing has generated too many “leads” for Sales to actually put through the full qualification process. So, the Sales team ignores some leads that could turn into business: effectively, they’re qualifying too hard by not really qualifying most leads at all.

• Ironically, at the same time the “leads” that they do cherry pick will often be over-invested in. This is in the hope that some business is actually there. They chase the wrong skirts. Effectively, Sales is not qualifying these leads hard enough.

• The yield — in terms of Sales cycles that go somewhere — is too low. So that Sales VP complains there aren’t enough leads.

The discussion quickly moves to “poor lead quality,” and new measures and incentives are attempted. But because lead quality isn’t consistently defined (and in fact is the wrong measure), things don’t get much better.

The root problem is that

neither Sales nor Marketing is optimizing the cost of customer acquisition. The Marketing VP is throwing a lot of money at generating too many bad leads. The Sales VP is using what is arguably the most expensive resource in the company ( Sales Reps) to do a job that is time consuming and repetitious: lead cultivation and enrichment.

Lack of Enrichment

To borrow a metaphor, Sales is like a nuclear reactor: it doesn’t matter how much uranium ore you have, the power plant just won’t work without enriched fuel. The goal is to have the expensive sales reps work only with enriched leads. The marketing function knows how to mass-produce the raw “ore,” but it takes a Sales touch — people on the phone — to purify and enrich the “revenue fuel.”

This is where a well-run and tightly measured telesales / telemarketing / ISR group comes in: they can spend the time to attend to a large number of leads, increase their level of interest, consistently qualify them, and bring them to the point where they want to watch your on-line demo or take that first meeting with the sales rep. This means high-touch cultivation over what is often months. Neither Marketing nor Sales Reps are cost-effective at it.

I hate to sound like a business process management (BPM) purist, but specific words really matter here. Like, what’s a “lead.” Sloppiness or inconsistency about terms can cause a lot of waste and finger-pointing. I recommend that your firm agree on a basic set of terms that everyone (including the board, if they’re micro-managing) use when talking about the revenue-generation business process. Here are my standards: use them as is, or modify them for your business… but standardize on something ad use them:

• Names

  are people who attend an event but don’t talk to you, are in the audience for an analyst conference, or are unlucky enough to have their contact info on a CD-ROM or a list you rented from a broker. These people have expressed no interest in your solution or service, but they are part of your target market space. Or they are people who had expressed interest in the past, but you disqualified them (or even lost them to a competitor). You send marketing materials and newsletters to these folks basically forever: until they “unsubscribe” or their email address bounces, consider these people as targets. Marketing is the exclusive owner and processor of Names.

• Leads

  are people who declared interest within the last 30 days. They talked to you at an event, or registered for something on your web site. Leads are highly perishable, and must be contacted fast. For example, someone who talked to you at a tradeshow will barely remember your conversation a week later. Someone who registered at your website may not even remember having visited there a day later. So a service level agreement (SLA) needs to be set up about how fast marketing gets leads get into the SFA system, and how quickly the contact attempts (both email and phone) happen. It is a good plan to have a schedule of contact attempts stretching out (with less frequent attempts over time, but retries for a full month). If no conversation has occurred in a month, leads revert to names. Telesales / telemarketers / ISRs should be the exclusive owner of Leads, although marketing should provide the content (e.g., white papers, scripts, emails) to assist the process.

  
  

  

• Contacted Leads

  are people in discussion with Telesales / Telemarketing / ISRs. They are not qualified yet, but they are being cultivated with information and offers of light-weight engagement that don’t involve a sales rep’s time (e.g., webinars). Contacted Leads may stay in this state for months or even quarters — no problem, because they’re not in the “funnel” yet and are being groomed as future pipeline. Make sure to use “tickler” tasks, as contacted leads may actually be in the hopper longer than the half-life of your telesales / telemarketing reps. Contacted leads should be exclusively owned by Telesales / Telemarketing / ISRs.

• Qualified Leads

  are people who have passed the qualification criteria, but may not yet have had their first conversation with Sales. A qualified lead is subject to re- qualification by the sales rep before it is accepted by the field. If the rep doesn’t believe that it’s worth putting sales time into a qualified lead yet (e.g., s he doesn’t smell a deal here), the qualified lead stays with the Telesales / Telemarketing / ISR person for further cultivation. When things are going right, people stay as in the qualified lead state for only a few days while appointment schedules are coordinated with the rep. Qualified leads are owned by Telesales, but shared with the Sales reps.

• Opportunity Contacts

  Opportunity Contacts
  

  are people whom Sales has accepted: there’s an opportunity, and a sales cycle with the contacts has begun. Opportunity contacts are exclusively owned by Sales and their SEs.

Outsourcing? Automation?

It seems that you can’t talk about a business process without commenting on how to outsource or automate it (maybe that’s what gave BPM such a bad name). In this particular case, the Telesales / Telemarketing / ISR function is dealing with highly perishable and sensitive assets: your future pipeline. Details and finesse — even tone of voice and attitude — really matter.

Consequently, only some of their activities can be routinized enough to be automated or outsourced. I do recommend automating a lot of the initial email outreach (implement a sequential auto-responder or other marketing automation tool), but once there is any serious engagement your people must take over. It’s pretty much the same story for the telephone work: use outsourcers to get phone numbers, update email addresses, or even figure out overall org charts. But when it’s time for phone conversations about your value proposition and market differentiation, these must almost always be done by your people.

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