Throughout 2020, many things unexpectedly came up to disrupt our everyday lives. A whole pandemic, for example, that shifted companies' original plans, and all the strategies set in place for 2020 got thrown out the window. Now with 2021 quickly approaching, the big question for most is whether to double down on inbound or outbound efforts.
We had a debate to end all debates - the Inbound vs. Outbound webinar. Two teams pitted against each other to determine whether inbound demand generation was better than outbound prospecting.
The outbound team consisted of Cindy Littlefield, Senior Consultant at The Bridge Group, Kyle Smith, Director of Sales and Customer Success from The Bridge Group, and Ryan O'Hara, VP of Marketing & Growth at LeadIQ. The inbound team consisted of Julianne Thompson, Head of Sales Development at Drift, Carol Martindale, Global Partnerships and Operations at Leadfeeder, and Dipak Vadera, Sales Manager from Leadfeeder.
Host Rishi Mathur structured the debate around a series of questions directed to either the inbound or outbound teams, and then the opposing team had the opportunity to rebut.
The central argument from team inbound was all about brand awareness and how it has a major impact on a company's growth and success. Basically, inbound grows your organization by building relationships with prospects and customers, by providing value. They do this by creating content and assets that identify and explain to prospective buyers realized or unrealized pains in their everyday jobs.
Key Points From #TeamInbound During the Debate
- How to tackle messaging depends on the stage of your company depends on the stage of where your company.
- Since COVID-19 many companies' ICP's have shifted. By using inbound measurements and inbound intent, you will be able to understand which part of your ICP did shift.
- Inbound reaches a larger number of people.
- Inbound has higher conversion rates since they are reaching out to the right people at the right time.
- Focusing on speed to lead conversion is key.
Driving Inbound Ideal Customers
The first question during the debate had to deal with Ideal Customer Profiles (ICP). The inbound team shares how they define their target market and how they customize their messages and why it works. Let's highlight the key points…
Carol shares it really depends on the stage of your company, when tackling who is your ICP and how you craft your messaging. For example, companies in their earlier days will target the lowest hanging fruit that will easily convert to get their feet off the ground. Looking at things like team size, revenue, etc. But as companies grow, they start to pay attention to the lifetime value. All in all, as you get more data, your target audience can be more sophisticated in terms of messaging strategy,
A good point made by Julianne - Once COVID-19 hit during the 2020 year, everything companies knew about their ICPs went in the trash. The market shifted, buyers shifted, and in many situations, your value proposition shifted as well. Therefore, by using inbound measurements and inbound intent, you will be able to understand which part of your ICP did shift.
The example Julianne used was if you had digital marketing as your key persona within your ICP, now the ICP shifts due to getting flooded with event marketers since they don't know what to do with their budget, now the ICP shifts. The only way you know how to understand what's going on with your ICP is through inbound.
Dipak also makes a great point on messaging and resonating with your ICP. The current cold email response rate is around 1%. If you're sending out a hundred, you're bothering 99 people out of the 100 - you're not reaching out to them at the right moment.
Building a Demand Gen Engine
Moving on, the inbound team was asked what their strategy is to build pipeline, and how it's better than outbounds. Julianne shared she has trained and managed SDRs her whole career, and the best outbound SDRs are booking about 30 meetings/month and actively working with 400 prospects at a time. In comparison, her inbound team's book between 70-100 meetings/month and has over a thousand conversations with prospects every month.
Dipak adds that when inbound leads come in, they go through a rigorous filtering and qualification process before deciding who will be reached out to. Then they're being passed on and calling them straight away within the first five minutes of an of a lead coming in. What Leadfeeder has noticed is that the conversion rates are 20-21 times higher when reaching out within the first 5 minutes, than if they left that inbound lead for an extra half an hour or an hour or an hour. Focusing on speed to lead conversion is key.
Carol adds to Dipak's point about the qualification process. She uses the example that if inbound receives 2000 trial sign-ups a month; they will then narrow that number down to say 600 qualified leads to handoff, with the automation set in place. In their filtering and qualification process, they know the final list are the right people to be reaching out to. Therefore, inbound has higher conversion rates since they are reaching out to the right people at the right time.
Outbound's main argument throughout the debate was that more qualified and personalized prospecting results in larger deal sizes, which greatly affects a company's growth. With inbound marketing, it's more difficult to control whom you're reaching, whereas, with outbound, you can handpick whom you are reaching out to and how that conversation will go. You will be able to make a personable first impression and connect through telling stories and being reactive to their input. You can provide value to the prospect based on interactive conversation. With outbound prospecting, you're able to research your prospect first, read about them, and understand what they're going through - not just noting their name and where they visited on your website. The information you research on a prospect is information that you can never get from marketing.
Key Points in the Debate
- When tackling ICP and messaging, it's about understanding the lifetime value of the customer.
- Outbound has to be relevant in the messaging that you use for buyers, and always personalize your messaging
- Outbound's most successful strategy to building pipeline consists of the target account strategy.
- Outbound closes larger deal sizes (in terms of dollar value) due to targeting the right ICP with more personable conversations and adding value that corresponds with the prospect.
Finding and Targeting Your ICP
The first question for outbound was the same as the question for inbound; how do you define and target your ICP. Kyle breaks down that understanding who your ICP is, is understanding the lifetime value of the customer. You cannot just look at lead conversion metrics; these can often be misleading. You're not just looking at what someone clicks, or what they're looking at, or even how long they view a page, but having a meaningful conversation with them, asking them questions and hearing how they respond.You also get more information on your ICP through conversations. Outbound is on the frontline. You can get more information about how your ICP has shifted based on what you're learning from the conversations you're having with prospects every day.
Does Outbound Have a Negative Side?
The second question was how there had been speculation that outbound prospecting can have both a negative and a positive impact on the brand. Cindy agrees that there can be negative impression on a brand when reps use messaging that is just wrong and/or provides no value. Your messaging should never be about you. She adds that as a sales rep, you need to ask yourself, "what's really important to that person?" "What is their life like?" "What are their challenges?" The answer to those questions is the value that your company brings to them.
Kyle takes a different spin on the question where he adds, "Potentially harming or helping the brand, I think, crosses the inbound and the outbound lines...You have to be relevant in the messaging that you use for buyers, and always personalize your messaging".
Building Outbound’s Pipeline
Rishi's next question pertains to how outbound builds pipeline. Cindy tackles this first by saying 3 words: target account strategy. It's all about where you want your revenue to come from. Don't sit back and wait for something; go out and get what you want. You need to identify the right accounts, identify the right people from those accounts, and then craft the right messaging. Yes, this takes a little bit more time, but it's better in the long run for a better opportunity in your pipeline, which transfers to a higher dollar value opportunity.
Rishi then brought the question back to #TeamOutbound’s core argument. "Outbound claims that they can close larger deal sizes, how?"
Kyle takes charge with this one, sharing that outbound closes larger deal sizes by targeting companies that align with your ICP. He shares, "We want to think about customer lifetime value. One of the things that Carol brought up in her initial response, and when we're doing outbound proactively to those individuals, it's not just increasing average deal size. It's really dramatically increasing lifetime value because the expansion potential within those accounts would be deemed the greatest of anyone on our list or anyone who's part of our total adjustable market".
He continues, "I think the deal size is bigger because it has to be. Because inbound is going to have higher connecting conversion rates. If outbound doesn't have higher deal sizes, then it's not a feasible channel. The deal sizes have to be bigger because the conversion rates are so much smaller".
Agree Or Disagree?
Now let's get into the fun part, the disagreements. There were many rebuttals throughout the debate, as I'm sure you guessed. Here’s the most interesting ones.
eBooks Don’t Result in Closed Business
First, Ryan shared some thoughts that rubbed the inbound team the wrong way. He said, "In the history of your life, have you ever purchased something because you downloaded an ebook? Have you ever bought something because you went to a webinar? Maybe you found out about a company because of it, but have these things actually ever driven action that turned into real customers? I find that question always to be no."
Julianne put up a good argument saying, "If we don't produce customers because of the value that we're driving throughout the buying process, and I'm not just talking about from the first time they talked to a sales rep, the data shows that the buying process starts a long time before that. To engage them with meaningful, tailored content to the persona that you're speaking to, to the ICP, you should be providing them with value. And then that's how you create brand awareness...And so I really would argue that point, Ryan, that content does create opportunities by building that brand awareness, which it's so important to have that".
Julianne made a great point about driving brand awareness and creating opportunities, whereas Ryan argues that you can do that, but you need to drive awareness to the right people. However, Carol counters by adding, "I wanted to clarify something with inbound marketing, we can target people as well. There's a paid aspect, and you can go on LinkedIn and target certain industries, job titles, team sizes, various lists, and then push the relevant content towards them".
Outbound Prospecting is Dying
During another debate, Cindy shared that outbound is not just emails. They can utilize phone calls, voicemails, LinkedIn, other social channels, etc. Outbound is incorporating all these approaches and painting a broader picture of telling your company story. It's all about the personable connection.
Julianne counters this by stating, "I want to talk about this multi-channel approach. We talked about making phone calls. Phone calls typically have between a 5%-6% connection rate, and that number is dropping in 2020. The best SDRs that I've ever managed typically convert between 20%-25% of those meetings. So, you're having fewer conversations converting, fewer turn into an actual conversation. And then, even when you schedule a conversation, that could be a tire kicker because we haven't used inbound data or inbound intent to understand where they're at in their buyer's journey. And so the timing part is what's really, really important from inbound. We could be reaching out to the same companies on inbound and outbound efforts, but the timing of it, that's the indication".
Kyle admits, "We cannot say that we're going to have comparable connect and response on outbound versus inbound. Inbound is always going to be higher. You're going to have higher conversion rates. However, I think we need to look farther down the funnel to truly evaluate the effectiveness of an inbound channel versus an outbound one". His main argument is that inbound leads cost more than outbound leads. That's no secret. Therefore, there is a lot more to look at under the microscope when looking at if inbound is more effective than outbound. And that's a valid argument. Inbound has higher connect rates; however, outbound has larger deal sizes in terms of dollar value.
So Which Side Won?
We’re going to leave that answer up to the audience. But from the debate we believe that there are merits to both strategies, especially when they work together.
Inbound is great at driving conversion rates. They help build the brand up and see what interests their target audience. They look at data for insights and a/b test different messaging to determine what works. When you think of inbound, you usually think of a larger, top of the funnel approach. Outbound is all about the individual experience. They are more personable and have to choose quality over quantity. They touch fewer people but source larger deals.
Both inbound and outbound have a purpose. It’s when they can come together and compliment where the other lacks are when you will see tremendous growth. Marketing and sales alignment is the key to success. The point to the matter is as a company, you should not be trying to decide which is better. You should be finding ways for them to work together effectively.