Sales representatives are the heart of any company that relies on them to bring in new business. If you’re wondering whether to hire an inside sales team or an outside one, you’ve come to the right place. In this article, we’ll discuss the differences between inside sales vs outside sales and show you the benefits and ideal business structure for each.
What’s Inside Sales?
Remote inside sales are a remote function. Initially, the term “inside sales” referred to a salesperson who worked from an office. Now, they can also work from their homes.
There are a variety of different sales techniques you can use to convert leads into customers. These can range from telephone calls to emails to social media.
Sales teams are responsible for small, more commoditized products or services. SaaS companies that sell software as a service rely on their internal sales force to sell and upsell their subscription-based products. These reps work to qualify prospects for the inside sales reps, who conduct demos and close the deals.
Inside sales reps can demo products by sharing their screen with prospective customers. Sales Development Reps (SDR) then schedule demos for an inside sales representative to close the deal.
The sales cycle tends to be much shorter, and deals are usually smaller when selling to companies using inside sales representatives.
There was a time when most sales were handled face-to-face.
Back in the day, salespeople traveled a lot, often spending weeks on the road and trying to sell their expensive products.
With the rise of digital marketing, salespeople no longer need to meet with clients physically.
The software companies that were the first to adopt an inside sales model did so because their sales representatives could demonstrate their products remotely. This was a significant advantage then, a trend that continues to grow today.
Inside sales reps are becoming more and more popular. They find new business by prospecting for new clients.
When a prospect is identified as a possible customer, an inside sales representative will conduct a discovery call to determine if the prospect is a good fit for their product or solution. The inside sales representative will demonstrate the solution if there is a match.
The sales rep provides a demonstration if there is a match between the product or service and the need.
A trial or demonstration is often included for potential customers to try the product before committing to it.
The sales rep has to convert the free trial into a longer subscription.
The buying process can be complicated due to legal requirements, security concerns, and financial requirements.
An Inside Sales Representative (ISR) is tasked with finalizing sales with customers, including negotiating contracts or revising them as needed.
They need to be able to type quickly, as they’ll spend at least eight hours daily on a computer.
They need to be relentless and not give up when trying to sell something.
They must have a keen sense of when a customer is ready to buy.
Finally, they need strong communication abilities to persuade and convince their clients to buy their products or services over the competitors.
We’ve stated many times in this article that inside vs outside sales are not the same. They are just different. Each sales strategy offers different advantages. Here are some benefits of inside sales.
- Faster response: Inside sales personnel can respond to customers faster. Why? They don’t need to travel to meet them. They can pick up the phone to give them a call or send them an email.
- Less costs: Since insider reps work from their office, they don’t incur travel costs. This allows them to convert more leads into customers for less money.
- Higher productivity: Sales reps spend only 37% of their day talking to customers. Outside salespeople, who spend more time traveling, can spend even less time on actual customer interactions.
What’s Outside Sales?
Sales reps typically conduct their meetings outside the main office of the business.
Outside salespeople usually work from home and travel to clients by plane or car.
Their role is to meet with potential customers, discuss their needs and present the product or solution that best meets them.
The inside sales professional is skilled at building rapport with customers, creating trust and establishing relationships.
Outside sales representatives are typically given more autonomy and responsibility than inside sales reps. This is because they are accountable for their schedule, prospecting, and the entire sales process with limited support from the home office.
Sales reps often compete with each other, trying to beat their quota and exceed their monthly goal.
Sales representatives who sell to other businesses, such as manufacturers, pharmaceutical companies, healthcare providers, engineering firms, and financial institutions, are called outside salespeople.
In many industries, the average deal value is high, and the sales cycle can last six months or more.
Sales processes are complicated, and outside salespeople often face many legal issues.
What about outside sales? What are the advantages of this sales model? There are many. We’ll only focus on the three most important.
- Stronger relationships: Because your outside reps have in-person meetings, they can forge closer bonds with your clients. This allows them to have a stronger relationship and more customer loyalty.
- Higher close rate: As discussed in the previous section, outside sellers often have higher close rates than their internal counterparts. This is double-bonus because outside sales often result in larger deals.
- It’s easier to motivate reps: Outside reps are often more easily motivated than inside reps because most are commission-based. As a result, they are more driven to close deals. However, salaried internal teams are less incentivized to sell, making it harder for them to meet their quotas.
Key Differences Between Inside Vs Outside Sales
Throughout the sales cycle, both outside and inside sales teams:
Establish a personal relationship with the leads.
Listen to their pain points and challenges.
Offer solutions to the pain points.
The difference is that field sales reps often do this in one meeting with prospective clients. Inside sales reps typically split this work between dozens of phone calls, text, and email touchpoints.
Because outside sales are so hands-on, it naturally leads to a longer sales cycle. This is because of the long-lasting relationships that are built with clients.
The personal relationship that an outside sales rep builds with a customer cannot, and should not, be replicated by an automated system.
Field sales reps can close more deals by working with fewer leads and focusing on the individual needs of each person they meet.
According to Sales Director Jonathan Ilett, online customer relationship management company Cognito predominantly uses an inside sales team. “Because of the regions we target and the size of our deals, we build relationships online,” he explained. But, for more complex solutions, we firmly believe that face-to-face meetings are the most beneficial. So, for simpler transactions, our sales reps prefer to use the telephone or perform a remote demo.
Outside sales reps may be the right choice if you are looking for long-term, large-scale growth and have the budget to do so. You may want to concentrate on inside sales if you need quick results and a smaller budget.
Outside and Inside Sales – Sales Team Structure
When both your inside sales and outside teams have to collaborate on a deal, how can you make sure they work together rather than step on each others’ feet?
The coronavirus has rapidly required sales organizations to transition from in-person to virtual meetings. 34% of respondents to a survey by Linkedin stated that they were planning to increase the size of their inside teams.
According to a recent study, sales teams now view digital marketing as twice as necessary as before the coronavirus outbreak. As a result, companies need to alter their marketing strategies to focus on online and digital methods.
This is mainly due to 90% of B2Bs switching to virtual sales teams.
The coronavirus has changed the way sales teams have to operate. We could see hybrid models become the norm in the next few years.
Remember this when hiring for, structuring and managing your inside and outside sales departments.
There is no one size fits all approach to building your sales force. It will depend on your market and the company’s specific goals and needs.
There are a few ways for you and your team to approach inside and outside sales.
- Separate outside and inside sales reps.
- Having both outside and inside teams work together.
- Have a Hybrid team that works on the outside and inside sales.
Inside Sales vs Outside Sales: Which Is Better?
You can see that not all sales roles are created equal. The end goal of providing solutions that meet prospects’ needs is common. There are, however, some differences between inside and outside sales. Everything, from where you spend most of the day to the skills required for success to your daily use of sales software.
Some companies have success only using outside selling. Companies shouldn’t choose between outside and inside sales. Both types of sales should be used to be as efficient and effective as possible. Companies can take advantage of both types of teams.
Understanding the differences between inside and outside sales is important, especially when starting sales. This will allow you to decide which role is best for you and your career goals. It will also give you a better chance of success from the beginning.
How can Outside and Inside Sales Team Work Together?
The two biggest ways inside sales and outside teams can work together are at the strategy level. By drawing from both, you can maximize your revenue.
- An inside sales team focuses on smaller to medium-sized businesses, which are more transaction-based.
- This saves your outside sales team the time and effort of dealing with smaller clients, allowing them to focus on bigger, more profitable deals.
The two outside and inside sales aren’t the only departments that can benefit from working together. They can also help one another out when it comes to tactics.
We spoke with expert Mark Kosoglow, who told us that inside sales reps are far more collaborative than outside reps. They share ideas and tips on phone calls, and hearing about a previous objection to a past conversation happens organically when you sit next to a teammate.
While waiting for your prospect to join your meeting, you can talk briefly with them about their needs and pain points. This can help you better understand how to present your value proposition to them.
The effectiveness of the new ideas spread by sales reps can be increased by rolling out the new techniques as training to other salespeople after they have reached critical mass.
It’s important to know that the way that your customers want to interact or communicate with your business is not static.
Your customers may like to buy from you in person at first, but once they trust you, they may prefer the ease of remote purchases. Or their preferences may change throughout the sales cycle.
Both outside and inside teams need to work together. This will ensure that they’re talking to the right customer most effectively.
Inside sales vs outside sales seem to have many differences between them, but they are essential aspects of a business. While outside sales are required for many complex sales processes, the low cost and flexibility inside sales are attractive for smaller technology companies and businesses. Consider both strategies and make sure you take advantage of the specific benefits.