At MPI, we believe that nine key factors contribute to the success of any outbound calling program.
We’ve covered list quality and quantity, message, nurture, and sales process as four of the nine factors that we find contribute to a successful outbound calling program. The fifth factor is return on investment (ROI) requirements. This factor asks: What will it take to get an ROI from an investment in an outbound calling program?
We’ve said it multiple times: Sales are the lifeblood of any business. Just as important is knowing that a particular activity will provide some sort of value to the company. There’s an expense associated with an outbound calling campaign, whether it’s outsourced, or the role is hired in-house. Overall, outsourcing the sales task is less expensive than a direct hire when all-in expenses are considered like costs of recruiting, hiring, training, benefits, salary, bonuses, technology, and benefits. Careful evaluation of several factors will help determine what goals and expectations versus what results are needed to see a positive result cost-wise.
We find that clients usually fall into three categories: They do not have any idea of how many deals it takes to get an ROI, they have a long sales cycle, or they have a full understanding of what it will take to get an ROI. We’ll dive in to explain more about each below.
No idea of what it takes to get an ROI.
In order for business owners or sales leaders to know what it takes to get an ROI for an outbound calling campaign, they need to take evaluate a few key factors:
- What is their average sales amount?
- What is their average close rate?
- What is the length of their sales cycle?
- What percentage of their customers turn into returning customers to produce annual recurring revenue (ARR)?
- What is the cost of lead generation – whether in-house or outsourced?
Knowing all of the information above can help in planning many areas of the business – not just how to get an ROI on a calling campaign. With some calculations from the data, it should be clear how many appointments it will take to get an ROI on the expense. It is then necessary to identify those companies that can provide the needed results if you choose to outsource or set that number as a KPI for an in-house hired sales staff member.
It can take 8 cold call attempts to reach a prospect.
Waiting for an ROI from a calling campaign can be a can be a tedious process. Given that it can take up to eight cold call attempts to reach a prospect, there are other measures taken to help the process. Pairing marketing through email, social media, and targeted paid ads can help a calling campaign see greater success. This points to other KPI’s that can be evaluated besides just the appointments being booked including nurturing, increase in brand awareness, or well qualified appointments (quality over quantity). Being knowledgeable on the results your sales team can produce, what will help increase business, and sales cycle averages will put you on the right track for getting an ROI on an outbound calling program.
Long Sales Cycle.
When a business has a long sales cycle, it is difficult to make a case for a consistent outbound calling program. If you think about it, the reason for the long sales cycle is likely because prospects need more nurturing to close the sale. Having a steady amount of new business leads coming in would not allow a sales team to stay attuned to those already in the sales pipeline. In-house sales staff would likely not have the capacity to handle multiple new clients.
Many outsourced sales partners have metrics on the results that are expected out of their sales efforts. Those metrics should be reviewed to determine if it’s possible for in-house sales teams to accommodate the new incoming leads if they typically have a longer sales cycle. Even one or two appointments per week may be too much for them to handle.
Full understanding of how many deals it takes to get an ROI.
Virtual high-five! This is the ideal position to be in. It shows you are well versed in your company’s sales, know the goals you need to reach, and what expenses will make sense to get there. Make sure to set KPIs that align with your business strategy and ultimate goals:
- Do you want to increase sales volume?
- Do you want to improve brand awareness
- Do you want higher value sales created?
- Do you want to increase customer retention?
- Do you want to enter new verticals?
Making sure goals and expectations are clear will help keep everyone on target and most importantly, produce an ROI for the investment made.
Sales isn’t always an easy process and it’s often best to evaluate what resources you sales team needs to produce profitable results. Overall, knowing how to measure the ROI for sales or any department or situation is important to keep a business profitable.
Not sure on how to calculate if an outbound calling program would produce an ROI for your company? We can help you figure it out! Let’s connect: