Sales are a critical component of most businesses that largely determine whether or not they will succeed within the overall market, especially against other competing enterprises operating within the same industry. However, it’s essential to understand that businesses can utilize many different types of sales, and each comes with a wide range of various benefits and drawbacks. Two of the most common sales methods that all business owners should fully understand include inside and outside sales.
This article intends to explore the elements that go into these two sales methods, their differences, similarities, and more to help you determine which sales strategy would be most optimal for your business. If you’d care to find out even more about sales and superior digital marketing strategies, please consider checking out the stellar resources and top-quality digital marketing services we provide for our customers here at Twiz.
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What is Inside Sales?
Inside sales, also frequently referred to as remote sales, refer to sales conducted entirely within the office and from the desks of sales representatives. Rather than selling products face-to-face like in an ordinary shop, inside sales utilize the massive range of communication tools that modern-day salespeople have at their disposal. These tools include phones, emails, social media, customer relationship (CRM) platforms, voice over internet protocols (VOIP), and much more. Sales teams can utilize inside sales for a wide range of purposes, though it’s considered one of the most essential sales models in Business-to-Business (B2B) operations, especially in tech and software as a service (SaaS) industries.
There is a common misconception that inside sales are essentially telemarketing, but that is very far from the case. Telemarketing is a scripted process that anyone can do, and even computers are now capable of providing telemarketing services. On the other hand, inside sales can only be done by a skilled salesperson who may choose to utilize a vast range of tools combined with CRM platforms.
These days, inside sales representatives typically work remotely and make sales right from their desk or home office using a large variety of strategies instead of only relying on cold calling or email marketing campaigns. The geographic growth of many companies (as well as globalization as a whole) has led to a more intense emphasis on the importance of global sales. Since inside sales representatives tend to work remotely, the overhead costs of physically traveling to various international locations have been largely eliminated, saving companies considerable amounts of money.
The go-to-market strategy of businesses largely determines the extent to which individual inside sales representatives and inside sales teams are relied upon. For instance, some market strategies will require inside sales reps to manage more complex accounts with more substantial annual contract values (ACV). Though inside sales are, once again, essential in the realm of B2B interactions, inside sales teams also deal in a range of services and products that carry a lower ACV and sell them to both individual buyers and small selling committees as well.
What do Inside Sales Reps Do?
In short, inside sales representatives work remotely with a range of potential customers to help guide them through the entire sales process and ensure they receive an effective service or product that helps them handle or solve particular problems. Generally, sales reps will have a predictable work schedule that includes a range of specific tasks they must accomplish each day. Their duties typically involve sending a certain number of proposals, answering a certain number of calls, and booking a certain number of meetings with prospective clients. In general, the core responsibilities of inside sales reps include:
- Closing deals with customers
- Reporting to higher-ups on relevant sales data
- Reaching the monthly quota goals set by their company
- Demonstrating excellent product and service knowledge to answer customer inquiries and help them locate the most optimal solution for their problems
- Building solid relationships with potential customers based on trust and a friendly rapport
- Nurturing leads to turn them into active customers
- Managing referrals from currently active customers
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What is Outside Sales?
Outside sales, also commonly referred to as field sales or traditional sales, involves selling products and services through face-to-face, in-person interactions between outside sales representatives and prospective clients. While inside sales reps work remotely, outside sales reps don’t typically remain in-house to conduct their business. Instead, they actively seek out and meet with prospects outside the office, which involves a large amount of travel, autonomy, and overall business intelligence, mainly since they deal with larger, more expensive accounts and higher-profile clients than inside sales reps. As a result of their work handling these significant accounts, outside sales representatives are often considered the superstars of their company.
However, it should be noted that in this day of modern technological advancements, the operations of both inside and outside sales representatives more frequently overlap since a significant amount of an outside sales rep’s work can be conducted through the same digital tools as inside sales reps. Skype, Zoom, Google Hangouts, and more all enable outside sales representatives to work effectively from the comfort of their office.
However, a clear distinction between inside and outside sales representatives still remains, as outside reps are still set apart by their flexibility and willingness to go and meet with clients and prospective clients whenever needed to complete a sale for the company. During these interactions, outside sales representatives are typically responsible for providing extensive product and service demonstrations and relationship-building opportunities that can help promote long sales cycles for their business.
The worldwide outbreak of the Coronavirus pandemic has also had a significant impact on the work of outside sales representatives over the past few years, preventing them from conducting their work in the ways they once did and causing their work methods to overlap more with those of inside sales reps.
Large trade shows and conferences, for example, were once an essential component of the general outside sales strategy that involved introducing new prospective clients to the company, educating them about new and existing services and products, and networking with clients to develop future business relationships. It is currently unclear whether or not these trade shows and conferences will fully recover and become as prominent as they once were. Until then, the overlap in practices between inside and outside sales reps is likely to continue increasing.
What do Outside Sales Reps Do?
As opposed to inside sales representatives, who tend to work remotely with clients and prospective customers, outside sales representatives spend the vast majority of their time traveling to meet with clients in person and nurture professional business relationships that will lead to future sales. As stated above, outside sales reps spend most of their time selling at conferences, trade shows, and during other types of face-to-face interactions with clients, though this has primarily decreased due to the pandemic. The amount of remote selling conducted by outside sales reps has increased by as much as 88%, primarily due to COVID-19. Beyond that, the core responsibilities of outside sales reps include:
- Identifying and establishing contact with prospective clients
- Scheduling and performing practical product demonstrations with prospective clients
- Recommending marketing strategies to help their business target specific geographical regions and customer demographics
- Developing and maintaining effective relationships with existing clients
- Generating and submitting sales reports to business managers
- Attending industry trade shows and conferences to identify potential new sales leads and make meaningful contact with current clients
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Inside Sals vs Outside Sales: What's The Difference?
You more than likely picked up on the considerable differences between inside and outside sales by reading the descriptions above, but there are several other essential differences between these two sales methods that people need to understand. From their general structural breakdown and cycle length to the skillsets of representatives and tools and sales metrics used for each, the differences between inside and outside sales are far more complex than many people may realize.
A sales cycle, in short, is the process of taking prospective clients and turning them into paying customers. You can think of a sales cycle as the average amount of time it takes from the initial point of contact between a sales representative (inside or outside) and a prospective client to the closing date of a sale. It can also be considered the general series of events that take place from the moment a sales rep meets with a prospective client up until a sale is finally made.
The sales cycles of outside sales reps are typically much longer than inside rep sales cycles, primarily because outside sales reps tend to handle more significant, more expensive deals that require the cooperation and buy-in of more decision-makers. These deals also tend to require a more substantial amount of back-and-forth negotiation.
Because of this, it is not uncommon for outside sales cycles to be denominated in more extended amounts of time, such as months, quarters, and even years. For example, a massive aerospace corporation that deals in specialized government defense contracts will generally not close a several billion-dollar deal in only a few weeks. The process will take a significant amount of time as sales reps carefully work out the details and conditions of the agreement.
Inside sales reps and teams typically handle deals and contracts that are not nearly as large or expensive as those handled by outside sales reps, so they tend to prioritize the number of leads rather than quality- though that’s not to say that quality doesn’t matter. Inside sales reps still qualify their leads, but they emphasize getting more of them. This process involves spending significant amounts of time sending emails, making calls, and connecting with new prospective clients. This is opposed to outside sales reps, who spend most of their time trying to foster a relationship with a single prospect to close a deal.
While inside vs. outside sales model structures are distinct, their primary differences can largely be summed up in four specific factors; what sales representatives do, their focus, how long their sales cycles typically last, and their overall cost and scalability. For instance, inside sales models involve sales representatives connecting with prospects, clients, and leads using various digital channels, such as phones, emails, and video chats to acquire leads.
In contrast, outside sales reps travel to meet with prospects face-to-face to nurture client-business relationships and convert leads into sales. Inside sales rep cycles tend to last under 90 days, cost considerably less, and are much more scalable than those of outside sales reps, which typically last much longer than 90 days, are much more expensive, and are less scalable.
This article has already taken the time to explain some of the various tools and technologies that inside and outside sales reps use to connect with clients and close business deals. Still, it never hurts to be a little more specific. For instance, inside sales reps are typically found at their desks working with their phones, computers, inboxes, and CRMs.
Meanwhile, outside sales reps take flights, pick up their rental cars, and sit patiently in office waiting rooms to get in front of big decision makers to negotiate and close a deal. However, many aspects of inside sales have bled into the workflow of outside sales reps due to technological advancements. This means that outside sales reps don’t have to travel as often or as far since they can easily rely on their phones to connect with new prospects through calls, emails, and more.
Whether a business is looking to hire new representatives to fulfill inside or outside sales roles, specific personality traits and skillsets will need to be assessed to find the most qualified individuals to fill the positions. It’s essential for business leaders and those looking to employ different salespeople to understand the qualities required for someone to succeed in either inside or outside sales. While some characteristics may overlap between the positions, they each have specific skills and personality traits that are necessary for a sales rep to get the job done and get it done well.
Outside sales representatives, for example, typically need to possess a significant level of emotional intelligence, situational awareness, independence, and adaptability to succeed at their role, especially when they are on their own going to see a client in face-to-face interactions. These reps need to possess an ability to think and act quickly, pick up on social cues, keep conversations going, and answer any questions a prospective client may have. Outside sales reps should also possess a significant amount of autonomy and drive since they are typically compensated based on their own actions and successes and are not closely supervised by sales managers or other business higher-ups, especially when their out in the field.
On the other hand, inside sales representatives must carefully follow instructions while maintaining a high level of focus for considerable lengths of time. They tend to use more process-driven sales strategies that are easily repeatable between deals with different clients. In fact, many inside sales reps and teams rely on specific scripts and templates to help guide them through their workflow process as effectively and efficiently as possible.
Core Sales Metrics
Both inside and outside sales reps and teams need to measure their overall performance to help them determine which tactics are and are not working on converting leads into sales. At a baseline level, these metrics generally measure the similar aspects of both sales roles, such as overall revenue, successful conversion rates, quota attainment, and more. However, there are clear distinctions in many metrics used to track the performance of inside and outside sales representatives.
Inside sales reps and sales teams, for example, will typically measure the overall performance of their emails, calls, and other points of contact with potential clients against their opportunities, successful connections, and successful deal closures. These ratios are much more effective than the volume of emails and calls they make and can more accurately measure a sales rep’s success. Outside sales reps and teams, on the other hand, tend to put more emphasis on tracking the overall number of presentations, meetings, demos, and other face-to-face interactions that result in the eventual completion of a sale. Outside sales teams are also known to emphasize their quarterly and annual sales goals, while inside sales reps tend to focus on these measures via a weekly or monthly timeline.
How Do Inside and Outside Sales Work Together?
As stated previously, many companies are moving towards the usage of both inside and outside sales tactics in this day and age. This is because they have realized the benefits of using both types of sales simultaneously to increase their bottom line. By utilizing both types of sales, businesses can more easily avoid missing specific sales opportunities. For example, by using inside sales reps to focus on sales between small and mid-sized companies, a business will inherently free up the workload of outside sales reps, allowing them to spend more time investing in bigger accounts worth significant amounts of money. However, this is not the only way these two branches of sales can work together to promote the success of a business.
They can also work together to provide tactical support and ensure that all types of customers are being contacted and interacted with in a way the client prefers, whether through face-to-face meetings or digital connections. Not all clients will want to meet in person, and not all of them will want to converse over email, phone, or video chat. Companies that provide clients with both options and allow them to choose their preferred method of communication can make the client more likely to prefer working with that company over others who do not offer such options. This makes it essential for companies to provide both inside and outside sales services while also ensuring that both types of sales reps can work together effectively.
Related: 25 Strategies To Launch A Product In 2020
Inside vs. Outside Sales: Which One Should You Use?
Traditionally speaking, most companies have primarily focused on outside sales to conduct business and build relationships with clients. Self-report data collected from more than 7,600 salespeople in 2020 and 2021 indicated that most representatives (56%) work in outside sales, while only 44% work in inside sales.
However, the industry is currently undergoing some significant changes due to several factors. The use of inside sales is growing at an astounding rate, as much as 15x faster than outside sales. Most organizations have actively decided to take on a 50/50 mix of inside and outside sales practices. Data collected in 2019 indicated that it would likely take about four years for inside selling to become the focal point of many companies. Still, new data has shown that the trend probably sped up considerably during 2020 and the early months of 2021.
While a significant deal of this shift can be directly attributed to the effects of COVID-19 and the social distancing restrictions that have been put into place, it’s also largely related to how the internet has transformed the ways that most people tend to make purchases. Fewer people than ever before want to deal with in-person interactions to buy something, simply preferring to rely on simple, one-click buying options online that don’t require the need for traditional sales rep-to-client interactions. Additionally, data from a Sales Benchmark Index (SBI) survey has indicated that only 27.9% of buyers prefer to meet face-to-face with outside sales representatives.
While virtual sales are steadily becoming the preferred method of business interactions for many, face-to-face sales are still highly regarded and considered very important. This is primarily because many people feel inherently more comfortable spending large sums of money and making big purchases in person. In the end, however, whether a business should utilize inside vs. outside sales depends on four critical factors: the business’s products and services, its overall organizational structure, its preferred sales strategies, and how its clients would like to be contacted in general.
What Are Your Products?
The products a company sells are one of the most significant factors to consider when determining the ideal mix of inside vs. outside sales that they’ll be conducting. An excellent way to evaluate the situation is to question what purpose their products serve and where and why people are likely to encounter and make the decision to buy them. For example, small products, one-time purchase products, products that solve simple, immediate problems, and products that appeal to a mass market are ones that would be very easy to sell online, making it more cost-effective for inside sales reps to handle them. I
n contrast, larger, more expensive products with a large ACV, products that solve more complicated problems and provide more benefits, and products that involve an ongoing commitment on the part of the customer are ones that clients generally prefer buying in person. This makes the products a much better fit for outside sales reps.
How is Your Business Organized?
The organizational nature of your business or company will also strongly affect the ratio of inside vs. outside sales conducted. In the same way that some products are more suitable to be handled by inside or outside sales reps, the organization as a whole may be more suited to supporting one type of sales practice over the other. For instance, inside sales would be a better fit for organizations focused on high sales velocity, reaching as many prospective customers as possible, and who operate primarily within the digital realm.
On the other hand, outside sales are better for organizations that sell expensive physical products and complex technology and focus on creating long-term relationships with more elite customers within the market. These differences in a business’s organization will significantly impact the type of sales they should utilize, whether it be inside sales, outside sales, or some combination of both.
What is Your Business Strategy?
The sales strategy of a business is the third factor that will largely determine its most effective sales method. If a business’s sales strategy doesn’t match the strengths of its sales reps and sales teams, they are likely to run into trouble and will not see much success within the market. If a business’s sales model is more predicated on high levels of transactions and is automated through digital funds, then inside sales would likely be better.
However, if a business’s sales model is focused more on building solid, longer-term relationships with clients and requires the use of meetings, demos, and frequent interactions, outside sales would be the way to go. Considering that many businesses operate using some mixture of these strategies in this day and age, combining both sales types is generally a good idea.
How Do Your Clients Want to Be Contacted?
Once again, not all clients are going to have the same preferences in terms of how they wish to be contacted and conduct deals with a company. While some may prefer meeting with outside representatives in person, others will likely prefer the convenience of working with inside sales reps through digital means. Companies would do well to investigate which method each of their clients prefers to use. Providing prospective customers with both options is a good way to ensure that they will be as pleased as possible with the services they are receiving, making it more likely that they will continue their relationship with the company in the future.
Final Thoughts and Considerations
Both inside and outside sales have proven themselves to be critical elements of business success, especially as communication technologies have advanced over the past several decades and radically altered how people can connect. As of 2021, data has indicated that a combination of both inside and outside sales is the best way to go for a massive array of businesses within many industries. However, the optimal ratio of inside to outside sales usage tends to differ depending on several factors regarding the company’s organization, products, strategy, and the preferences of its clients.
If you’d like to learn even more about business sales, as well as ways you can enhance the performance of your business through superior digital marketing tactics, please consider looking into the range of top-quality services and resources proudly presented by our experts at Twiz. They can provide you with the tools you need to get your business off the ground and help you beat out your industry competition while finding financial success within the market.
Does your business need a little help in the digital marketing department to get off the ground and find market success? Please consider checking out the vast range of superior services proudly provided by our marketing experts here at Twiz, or contact us today at (323) 366-3250 to find out exactly what we can do to help.