Cold calling is no longer an effective sales or marketing tactic for most B2B Health IT companies. There are far more effective ways to generate leads. However, for companies that lack marketing support and are in an acute need for revenue, cold calling may be the only option available.
Traditionally, cold calling has referred to the act of soliciting business from a prospect that has not had prior contact with the salesperson conducting the call or the company the salesperson represents.
Cold calling is not looked upon fondly. It is used by criminals looking to nab their next mark with the latest phone scams. Political parties use cold calling to drum up votes and/or financial support for candidates. This is one of the reasons it has declined in popularity as a B2B sales tactic. Another is how inefficient it is.
Cold Calling Math
Here is how cold calling math works:
- 100 calls = 5 conversations (a generous success rate)
- 10 conversations = 1 sales meeting
- 10 sales meetings = 1 sale
In order to generate 1 sale, you need to make 2,000 calls. The average cold caller can make 100 calls per day so you need 20 days of effort to generate 1 sale. I can think of better ways to invest that amount of effort – like writing a whitepaper, a blog or a case study.
Cold Calling as a Last Resort
Despite its inefficiency, cold calling may be the only viable way to generate business for companies that:
- Do not have any marketing support or in-house marketing resources
- Have no other way to immediately generate leads
- Have salespeople willing to make calls
Start-ups are companies in this type of situation and may have to resort to cold calling to put them on a path to revenue. Cold calling is better than just waiting around for deals to fall out of the sky.
Effective Cold Calling
Over the years I have managed teams of cold callers and designed cold calling campaigns. Here are 5 tips that helped me squeeze out a few more conversations and meetings per call:
- Remember that the primary goal is not to get a sale during a call, but to earn the right to continue the conversation (either by phone, email or in-person)
- Don’t waste time trying to script the perfect call. There is no such thing. Just dial and start having conversations
- On each call, try to get additional information to help with future marketing – like how long they have been using your competitor or the EHR they use
- For each daily goal (calls attempted, conversation time, etc) give yourself/your team a reward. Make 100 calls, buy yourself a fancy coffee.
- Keep plugging away. Cold calling is purely a numbers game. The more you grind, the sooner you’ll get to someone who will agree to a sales meeting.
Use Warm Calling Instead
A far more effective tactic is warm calling. Instead of cold calling a prospect that has not had any prior contact with the company, call prospects that have interacted with the company previously. Also known as follow-up calls, these “warm” calls have a significantly higher success rate.
In my experience, warm calling yields at least 5-10x the number of conversations compared to cold calling.
For example, imagine calling everyone who attended your webinar and opening the conversation by asking them what they thought of it and what topics they would like to see in the future. From there you can lead the conversation (gently) to pain points or benefits that your product/service provides.
Cold calling is far from dead, but it has limited effectiveness in healthcare. Most organizations who have in-house marketing resources are far better off using warm calling instead – a tactic that is far more successful and can actually compress the sales funnel.