If your organization is like a lot of sales organizations, you may have intensified prospecting efforts lately as old customers have downsized, cut spending, and, in some cases, switched to other suppliers. The problem is that prospecting is often time-consuming, costly, and hard on the morale of the sales team. Why? Look at some of the typical tips for successful prospecting:
- “Schedule a minimum of two hours a day for phone calling.”
- “Spend the first 30 minutes of each day making at least three calls.”
The idea is that if you make enough calls, sooner or later a certain percentage will result in meetings, and a certain percentage of those will eventually result in sales.
The fundamental flaw in this strategy explains why most salespeople hate prospecting—they hear a very large number of “No’s” for every “Yes.” If the great majority of their calls are to people who have no interest in their offering, the time they spend has little effect other than to lower motivation and drive up the cost of sales.
Consider another set of numbers: As a rule, the unscreened suspect-to-prospect ratio is 10:1, with a prospect-to-sale ratio of 3:1. This means that the suspect-to-sale ratio goes up to 30:1. With this low rate of success in reaching real prospects, little time or energy is left over for the actual sales calls that bring in revenue.