Is It Right for You?
I recently sat down with entrepreneurs participating in the Alchemist Accelerator program, discussing when does it make sense to make an investment in outbound sales. It is actually essential for startups that have:
- An average deal size of at least $5,000-$10,000
- Identified ideal customer profiles
- A product or service for businesses
- A clear value proposition
- A competitive market
Zenefits is a great example. It grew to $20M ARR in two years by making an early commitment to outbound sales. Matt Epstein, VP of Marketing, credits a focus on continually refining both the value proposition and customer targeting of cold emails for maximizing outbound sales impact.
He spent three months A/B testing small tweaks and complete value proposition language changes. He also reached out to a wide variety of audiences—from CEOs to HR, finance, and marketing professionals—with different concepts to discover what resonated best. The process allowed him to hone in on the right message and audience, which served as the ideal stepping stone to scaling the company’s sales organization.
While transactions are the objective of marketing emails—a best practice for all startups, but particularly for those with lower deal sizes, selling to consumers—the primary goal of an outbound sales email is to get a meeting. Positive interest is a building block to deeper engagement that can make a tremendous difference in a startup’s business trajectory. Yet most companies spend very little time on this critical first impression.
Are You Committed to the Process?
Startups seeking to get noticed rely heavily on three communication platforms: a website, social media and blogs, and email. Experts estimate website planning to launch time averages 12 to 16 weeks and includes several phases—discovery, design, development, and modification—where input is considered and changes made, as needed. Similarly, startups spend a minimum of an hour or two a week on content marketing strategies and effective execution. Yet when it comes to cold emails, the preparation, crafting, and delivery time averages about five minutes!
Five minutes per email. That’s how little time founders, many of whom are already feeling overburdened, are spending on all-important, first impressions. Something else has to give because each cold email deserves considerably more effort.
A cold email is unsolicited, but what differentiates it from spam is that it’s not random nor deceptive. A cold email is a best-effort communication to reach a specific audience about your new product or service. Because it’s so important in a company’s early stages, one of my colleagues advocates for cold email reviews internally. The rationale being that if founders elevated and equated the importance of their startup’s first cold emails to something like buying a Super Bowl ad, the amount of effort undertaken to make it a success would rise exponentially.
Have You Done Your Homework?
Emails and videos can both be effective vehicles to communicate a personalized message to a targeted recipient. The key is doing the upfront work to know what will resonate best. At LeadIQ, we typically see an 18-30% response rate to our cold emails because we’re in the business of fast outbound prospecting. Before anyone on our team sends a cold email, we’ve identified the person or profile we are targeting and have personalized the message appropriately.
I’m a huge proponent of outbound sales because when you invest the time, it works. Here are a few good examples:
- An inside sales team lead took his interest in music to another level, creating personalized cold emails with a link to a custom music video: Take a listen.
- Discovering a prospect used to teach Spanish, a creative marketer used his knowledge of the foreign language to connect. The reply came quickly and with a complimentary P.S. that read: “Seriously, good creative approach to an email. I laughed and felt way more compelled to respond to you. Nice work!”
- Putting a demo link at the end of one of my early cold emails to an investor with a product-first mindset prompted an immediate response. Many meetings later, he invested and remains a trusted advisor to this day.
In our hyperconnected world, one communication is rarely enough to keep raising a prospect’s interest. That’s why it’s also important to add value in every follow up email and engage appropriately through multiple channels—social media such as LinkedIn, Facebook, or Twitter—when possible. Then, don’t forget to measure, so you know precisely what is and isn’t working.
How Do You Scale What’s Working?
After you’ve honed your value proposition and identified the specific target audience interested in your offering, it’s time to think about scaling your outbound sales efforts. Hiring sales development representatives (SDRs)—either as employees or through an outsourced firm—is the first step.
Internal SDRs are immersed in the company and often cost less, but typically end up booking fewer appointments a month. External firms ramp up fast and using scripts and templates can engage more staff to book appointments every month. For founders considering the ratio of SDRs to account executives (AEs), the following general rule of thumb can be helpful:
- 1 SDR : 1 AE (not enough inbound opportunities)
- 1 SDR : 2 AE (decent inbound opportunities)
- 1 SDR : 3 AE (mostly inbound opps)
In all cases, startups can boost the success of SDRs by developing generic videos, personalized to a small list of hyper-personalized targets—for example physical therapists using a medical device or mobile repair teams using software on an iPad at the top of a telephone pole. As calls to action, these outbound sales vehicles incite interest while saving SDRs from creating a new, personalized communication from scratch for every new prospect.
Are You Ready to Execute?
The process to find new prospects is simpler when you continuously review websites listing competitors, discover market references, and search targeted keywords on platforms such as Google and LinkedIn. As frustrating as it may be in the beginning, staying committed to getting the outbound sales process right is the fastest way to define your target audience and refine your value proposition—both critical to your startup’s success.
This post first appeared on Alchemist’s blog.