As a small business owner, every cent you put into your marketing budget counts.
The Small Business Administration advises companies with less than $5 million in annual revenue to dedicate seven to eight percent of their budget to marketing.
However, with the average business advertising on eight marketing channels, it’s easy for your budget to be stretched too thin. You can’t afford to waste precious advertising dollars on ineffective channels.
Like so many other business owners, you think that cold calling should be the first to go to make way for more modern channels like social media and SEO.
After all, you think, is cold calling even effective in 2021?
While diversifying marketing channels is important, the statistics and studies below suggest that you should rethink the rush to ditch cold calling.
Table of Contents
What Is Cold Calling?
Cold calling is a marketing and sales technique that involves making outbound telephone sales calls to qualified prospects/leads that know very little (or nothing) about a company before the initial contact.
Cold calls can be made to individual consumers (B2C) or other businesses (B2C.)
Warm calling is another popular method of sales prospecting. In a warm call, agents reach out to a lead that has had some sort of prior contact with your company, such as a marketing email, SMS campaign sign-up, or someone who has previously expressed an interest in your company in any way, including in-person.
Companies can find high-quality prospects (AKA, people that are the most likely to be interested in what the company offers) in several ways, such as:
- Purchasing lead lists and number databases from third-party data providers
- Referrals from current customers
- Researching on LinkedIn or Google
- Lead generation from word-of-mouth and in-person events
- Competitor research
- Email signatures, messaging signatures, out-of-office replies
Though this post primarily deals with cold calls, remember that cold emails or cold social media messages are also effective ways of reaching potential new clients.
Cold Calling Benefits
Unlike more indirect forms of marketing (mailings, social media ads, or TV spots) cold calling provides a rare opportunity for real-time, two-way communication.
It gives callers the chance to evaluate the quality of leads, to get to know their target market better and to create personal relationships with the people your company does business with.
Additional benefits of cold calling include:
- Excellent sales training opportunities for new and existing agents
- Cost-effective marketing method for startups and small businesses
- Provides key information about target market’s pain points, needs, expectations for products/services, and more
- Opportunity to research competitors (determine how many prospects are using competitor tools, identify top competitors, learn where competitors are falling short)
- Way to tap into new markets and gain clients that couldn’t have been won another way
- Highly personalized communication
- Calls can be made from anywhere, on almost any device, saving on the cost of hardware and offering employees flexibility
- The choice to hire full-time, part-time, or short-term remote or in-house employees
Cold Calling Statistics for 2021
Especially for small businesses with tight budgets, listening to the benefits of cold calls alone isn’t enough to refute the misinformation surrounding the effectiveness of cold calling.
If you’re anything like most business owners, you’ve probably read countless articles claiming that “cold calling is over;” that it’s ineffective, outdated, a waste of time, annoying, and that rude customers are stressful for sales reps.
Then prepare to be shocked by the below data-backed proof of the advantages of cold calling.
The Power of the Cold Approach
One of the biggest reasons why businesses are skeptical of cold calling?
They think other people simply don’t want to be bothered or see cold calling as aggressive and pushy.
But a study from the RAIN Group shows that:
- 69% of buyers have taken calls from new companies in the past year
- Over half of senior-level buyers and decision-makers prefer to be contacted via the phone
- Over 80% of buyers take meetings with salespeople that reach out to them first
- 71% of buyers want to hear from sales teams when researching how to improve their business
- 62% of buyers say they’d like a seller to reach out when they’re trying to solve a business problem
- 27% of sellers believe cold calling is one of the most effective ways to get new clients/customers
- Cold calling is five to ten times more effective than email campaigns
- Between 30-50% of sales go to the business that was the first to reach out to the prospect
Source(s): RAIN Group, Clearbit, Invesp
What Prospects Want From Cold Calls
Now that you know the truth about how many buyers actually want cold calls, you need to learn what they want to hear on these calls.
Research shows that:
- 96% of buyers say they’re most influenced by cold calls that show the value their products/services will offer them (value proposition, etc.)
- 66% of buyers say that cold calls highlighting the solutions to current business problems influence them to schedule a follow-up to the initial contact outreach
- Over ¾ of sales professionals say contacting prospects at the right time has a huge influence on conversion rates
- 54% of buyers want detailed information on product features and services on the first phone call, but only 23% of agents provide that information on the first call
Source(s): RAIN Group, ringDNA, Pivotal Advisors
The Data Behind Effective Cold Calling
We’ll provide more detailed cold calling advice and best practices later in this post, but the below statistics are an excellent way to understand how to increase cold call conversion rates.
Over 40% of agents say that making calls is their best sales tool. Make the most of yours with the below cold calling strategies and tips.
- The average sales representative makes 45 phone calls every day
- The best time of day to make a cold call is between 4:00-5:00 PM
- Between 2:00-3:00 PM is the worst time of the business day to make phone calls
- The best day of the week to make cold calls is Wednesday
- Friday is the worst day to make cold calls
- Successful cold calls discuss between three and four of the prospect’s current business problems
- Effective cold calls included an uninterrupted sales pitch of roughly 37 seconds in length
- Agents that asked eleven to fourteen questions had an over 70% cold call success rate, while agents that asked only one to six questions had a roughly 30% lower success rate than those that asked between 11-14 questions
- The most successful cold calls are between 6-10 minutes in length
- Research prospects before reaching out wherever possible. Over 50% of prospects are not a good fit for what agents are trying to sell them
- Asking, “Did I catch you at a bad time?” decreases the likelihood of call success by 40%
Source(s): Salesmate, Gong Labs, Sales Insights Lab, Topo
The Importance of Following Up
Nearly half of all sales agents never bother to make even one follow-up attempt with a prospect after initial contact.
Doing so isn’t just a waste of time and company resources. The failure to follow up with potential customers results in significant potential revenue loss.
- It takes an average of 8 cold calling attempts to reach a prospect
- The average sales agent makes only 2 cold calling attempts to connect with a prospect before giving up
- Over ¾ of sales require roughly 5 follow-up phone calls before the lead converts
- Nearly half of all salespeople only make 1 follow-up call before giving up
- 42% of buyers say they’re much more likely to convert if a B2C or B2B sales representative calls them back at a scheduled time
Source(s): Salesmate, Geckoboard, Invesp
The Art of Cold Calling: Actionable Tips to Close the Deal
There are three stages of cold calling: the pre-contact qualification phase, the discovery phone call itself, and the follow-up phase.
Below, we’ve included expert cold calling tips for each stage of the sales process.
Preparing for the Call
The journey to cold calling success begins before anyone dials or picks up the phone.
Qualifying leads pre-call means agents spend more time talking to real prospects that are probably already interested in what your company offers, instead of wasting valuable time on people that have no interest in what your business does.
Studying your current market will help you to develop a strong customer persona, so you can better identify and understand your target market. If you have a website, rely on that data to qualify leads. Consider the problems that someone in your persona’s age, field of work, income, interests, and location has that your products and services could solve. (The BANT, CHAMP, and GPCTBA methods are all effective lead qualification templates.)
Also, ensure your team members know as much as possible about the products or services your company offers. While of course, employee training and mock phone calls can help, it’s tough to remember everything when on the phone.
Useful tools like internal wikis and databases provide key information that can easily be searched for and read aloud to leads and help to prevent callbacks or call transfers (which usually lead to lost opportunities.)
Additionally, provide agents with detailed cold calling scripts and pre-written pitches along with answers to likely questions or comments from the prospect.
During the Call
Given how long it can take to actually get someone on the phone when cold calling, when an agent connects with a prospect, they need to nail it.
Getting to know the prospect, their needs, and accurately gauging their interest level is one of the most important parts of the call — yes, even more so than pitching, which can come during follow-up calls or follow-up emails.
Asking the right questions can help callers uncover key information by which to evaluate the prospect. (For example, whether you’re talking to someone with buying power or a gatekeeper.)
But some questions are more valuable than others. Avoid niceties at the start of the call (such as “how are you?”) and get straight to the point.
Sample discovery questions include:
- Who at your company makes decisions about the products your business uses?
- Are you currently using any other products to help you solve a similar problem/meet a similar need? If so, where is it falling short?
- How much do you pay for competitor products, and what is the current length of your contract with these providers?
- How soon do you hope to be able to use our products/services, and what’s your timeframe for implementation?
- Which features or available services are most important to you and why?
- What is your expected ROI with the use of this product or service?
When listening to the prospect’s answers, know what indicates a poor prospect vs. a good one.
If the lead doesn’t want to provide answers, doesn’t want to connect the caller to anyone else, provides only brief answers, or offers constant contradictions, they’re likely not worth your company’s time. The same goes if they don’t want to schedule a specific time for a follow-up call or provide additional contact information.
But if the lead is asking questions, giving detailed answers, or is already using a similar product, they’re likely a quality one.
Additional tips for success on the call include:
- Identifying yourself, your business, and the reason for your call within the first ten seconds
- Matching the client’s tone
- Empathizing with the client’s needs
- Listen more than you talk, and speak just 1-2 sentences before stopping to let the caller respond
- Sell the product/service’s value, not the product itself
- Avoid pressing hard for a sale on the first call
- Collect lead contact information, communication channel preference, and set a follow-up call
After the Call
After the call is finished, agents should have collected enough information to evaluate the overall quality of the lead.
Make sure team members rate the lead’s interest, provide detailed call notes, list the prospect’s contact information and preferences, and set reminders for follow-up calls or emails.
A follow-up call or virtual communications should include:
- Date of the first call, representative’s name, contact information, and position
- Products/services discussed
- Calendar invitations for future contact
- Additional questions for the lead
Finally, take a look at sales call analytics to see inside sales teams, identify the most successful agents, understand when leads are more likely to answer, view average talk time, and access more data to improve the cold calling process. Analytics and data also help SDRs (Sales Development Reps) get a deeper insight into what captures a prospect’s attention at different points in the customer journey.
Boost Cold Calling Success With the Right Business Phone System
In addition to cold calling best practices above, you can leverage the power of a high-quality VoIP phone system to boost your cold calling success rates.
Business phone solution cold calling features that make the process simpler and more organized include:
- Automatic Outbound Dialing Modes (Progressive, Predictive, etc.)
- CRM system integration
- Automated callbacks
- Cold call scripts and follow-up sales scripts
- Call recording
- Call monitoring, call barge, call whisper
- Appointment setting via IVR
- Call analytics
To learn more about the providers that offer these features and more, check out our interactive table of the best call center software.
Cold Calling FAQs
Below, we’ve answered some of the most common cold calling FAQs.