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Cold Calling Realities

Discussion in 'Advertising, Marketing, Social Media' started by 458, Aug 31, 2016.

  1. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    I posted this in my progress thread but i felt it should have its own place. There are a lot of people on this forum claiming to do what we do and i can tell you that numbers don't lie. These are MY businesses numbers resulting from nothing but COLD CALLING ICE COLD LEADS.

    Attached are my OUTBOUND COLD CALLING sales stats per each of my individual sales persons and per the room as a whole. Abbreviation definitions are at the bottom of the sheet. Doubled my sales in 2 months, not bad. I expect to double them again over the next two month.

    If your so lazy that you won't open an excel, here is a summary of the room from May - Aug:

    Total dialed calls - 115,047 (YES, that's one hundred fifteen thousand and forty seven dials)
    Total connected calls - 36,166
    Total Prospects - 1,010
    Total sales - 114 (YES, that's one hundred and fourteen sales made from 115,047 dials, THAT IS REALTY)

    Dials to sales is .08%
    Connects to sales is .21%
    Prospects to sales is 6.96%

    Cold calling works, but anyone that tells you that it's easy or some type of miracle drug is selling you a load of shit. This is not for everyone, but its absolutely one of the fastest ways to build a company from scratch and scale it into the millions.
     

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  2. Jon L
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    Jon L Gold Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass

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    what type of product/service do you sell?
     
  3. avilux
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    avilux New Contributor

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    Those numbers are insane, thanks for sharing. I was told by an old marketing CEO that .5% conversion rates are great. That number alone made me shift most of my efforts into inbound marketing. For startups though, both inbound and outbound marketing is important. It's certainly a numbers game. The law of abundance.
     
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  4. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    High ticket service. Obviously if your selling $10 widgets these numbers would be a bit different. Each customer is worth $3k - $5k on average after the funnel sale which is what these numbers are. Our funnel sale is $599.
     
  5. Justin Gesso
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    Justin Gesso Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Man, I don't think you're right.

    How many labor hours did it take for you to make 100K calls? What's the net on the products/services you sold? And if I'm reading it right, you didn't close the sale, so there was more manual effort in the process. That's tough math to make work.

    In my experience:
    • Big-ticket items sell based on the relationship. Cold calls won't work.
    • Small-ticket items may sell via cold call, but it's a way cheaper, easier to test, and more effective to use online advertising and sales processes.
    I have yet to see a scenario where cold calling wins. Correct me if I'm wrong.
     
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  6. xaviel
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    xaviel Bronze Contributor Read Millionaire Fastlane

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    I like this.

    5 person team correct?
     
  7. jmomcc
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    jmomcc Contributor Speedway Pass

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    This is really cool.

    Was there a noticeable difference between the best performers and the worst before you saw the numbers? Could you describe those differences?

    Also, if I'm reading it right, the last salesperson's (DB) stats may have been copied over for their second month unless they had the exact same stats.
     
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  8. AgainstAllOdds
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    AgainstAllOdds Legendary Contributor Read Millionaire Fastlane FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Bullshit.

    I hate people saying cold calling doesn't work without doing the math. Take a look at @458's spreadsheet. He had four people calling full-time in August. And one person calling here and there.

    From that, he generated $126,000 to $210,000 in value (based on his $3-5k lifetime value).

    Upfront, he made $25,158 off of the funnel sale.

    Now let's run some more math. Let's say his average sales person makes $100k a year. That's $8,334 a month. Or: $33,334 for his 4 sales people. He paid out $33k in expenses. Received $25k upfront, for an upfront net loss of $8k. However, looking long-term he made $126k - $33k = $93k. Or $210k - $33k = $177k.

    Read that again. $93,000 to $177,000 in one month off of cold calling.

    But I can see where you're coming from. If you dive into his spreadsheet, then you'll see that his conversion rate per connect is 0.21%. To put that into words: That's one person buying out of 476. Imagine 475 people telling you to F*ck off before the 476th says: "Sure, I'll buy." That takes some balls of steel.

    If you look at it from that perspective, then your statement: "Cold calls won't work," makes sense. However, if you look at it from the perspective of: @458 is about to net $1 to $2 million this year off of cold calls. And likely even more as he builds his team. Then you realize how ridiculous and mentally stubborn it is to deny his success.

    And before you go off on a rant about how there's a better way... Who gives a shit! This guy is on track to make millions a year off of cold-calling. Who gives a F*ck about "a better way" when you're already making millions -- while growing!
     
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  9. Torobaro
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    Torobaro Bronze Contributor Read Millionaire Fastlane

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    Amazing, mad respect for you.

    I recently watched a video of Jordan Belfort on cold calling and he stated that the following should work:
    • Make 140 cold calls per week.
    • You will manage to speak 40 times with the decision maker.
    • Of those 40 times you will close 8 meetings.
    • Of those 8 meetings you will finally have 6.
    • From the 6 meetings you will make two sales.
    However he wasn´t talking about a specific product or service.

    Best! Great work!
     
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  10. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    This is correct in that, it is a relationship sale. It typically takes 2-5 follow up calls to close the deal.
     
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  11. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    The best guys are the most focused and consistent. I fired DB for being lazy in the beginning of the month but he did close one. When i closed his account, his stats disappeared that's why i copied them over.
     
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  12. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    Pretty spot on, it is definitely an abusive job. I can scale this business solely on cold calling to about 6-10 million in revenue a year at 20% margins with the leads that we generate.
     
  13. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    4 now, i fired DB. I have a new guy starting on the 12th. Most hiring happens in the beginning of the year.

    PS. Im PG on the sheet, i usually don't have time for calls but sometimes ill jump on and talk to these assholes.
     
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  14. Dark Water
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    Dark Water Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass Summit Attendee

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    My experience cold calling wasn't so cold. I was on a dialer calling leads for mostly auto insurance, but eventually dived into home insurance as well. Difference was my prospects had recently filled out their information online, trying to get an online quote, or were just dabbling around online. But at some point they gave their information to a lead vendor, where the fine print said it was okay to call them. My competition was the 5 to 10 other insurance agents calling them (because we were buying leads from the same lead vendor) and I had about 12 different companies to pitch as an offering, across 15 or so states. Everything was assessed online and could close the sale in about 10 minutes because I was fast with the software, but the actual sale usually took about 20-30 minutes. People need auto insurance though and its a bit of a smaller purchase, averaging about $1.4k per year, but as little as $400 a year and as high as $6k per year depending on demographic, credit, and driving record.

    At about 40-50 hours per week, I was selling 40 to 50 new customers per month, or about 2 to 3 new per day. 3.5% total close sale was expected. A good day, you'd limit the amount of people you would talk to to between 20-30. On a bad day, say you get a poor night's rest and your prospects can feel it and hear it, you might talk to 150 people and burn a ton of leads, with no sales.

    Cold calling is definitely tough, and without anything to screen them before hand (like filling out info online, or buying from a lead source, or anything at all), it definitely gets infinitely harder. As you can see from his .08% with pure cold calling vs 4% with someone who was previously displayed interest by searching for the subject online (and needing the product).
     
  15. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    Absolutely. Our demographic is 45-70 year old independent contractors and small business owners. We're catching them in every scenario possible each day, in the car, at a job site, eating lunch, etc. We have to hook them in the first 5-10 seconds, if not there gone.
     
  16. Yoda
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    Yoda Gold Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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    Here's why he IS right.

    Action.

    And something tells me they are making some kind of profit or they wouldn't have hit 150k calls. You'd know by then, or you'd have a much, much bigger problem.

    These guys have taken a massive action, and are producing a revenue. You might not think it's the highest possible net cash on time, but guess what...

    It's not a zero, either.

    How many guys are sitting around on this forum mentally masturbating their new Gallardo?

    Meanwhile, these guys are in the trenches digging up gold from thin air.

    You also forget there are lots of untold down-the-line sales made from this. Referrals, repeat buyers, increasing margins, etc.

    He's right. You're just skeptical because you don't want to believe how much work it takes.

    Believe it.
     
  17. Justin Gesso
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    Justin Gesso Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Ha, great response and spot on.

    To clarify my earlier comment a bit...

    I have in fact hired dialers in the past and used them successfully (positive ROI). I've managed contact center agents in my office, in India, in Hungary, and in Argentina.

    But, transitioning that dialer work to online lead generation has been much more effective.

    Just working "hard" on something doesn't necessarily mean it's the best way to do it.

    Of course, everyone's business/situation is different. If this is paying off well for @458 (which is seems to be), then great.

    Where costs creep in

    The labor, technology, management, training, and building/other costs that it takes to do high volume cold calls can be massively higher than people expect. Without the data on dollars in and dollars out for this model, we're missing quite a bit of important information in that spreadsheet.

    General challenge with this model

    My biggest pain point with cold callers was recruiting and retention. Great-performing cold callers often were good enough that they were better suited for other roles. They'd move up with us or out. The rest of the cold callers just weren't great employees. It's not the most attractive job, so didn't exactly attract the best and brightest. This all created a lot of "HR" overhead. Constant recruiting, training, and performance cycles.

    We have been able to avoid these sort of headaches and costs by moving to other advertising/sales methods.
     
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  18. Justin Gesso
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    Justin Gesso Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    An additional thought/question...

    This is tougher to quantify, but there is also concern that cold calling can damage a brand. First, you are "intruding" on people. Second, people making the calls are representing your company. If the type of people that are willing to take these sort of jobs generally aren't the best..are they the people you want as the face of your company?

    In fact, a partner in one line of business pulled the plug after 3 months not because of ROI, but because he was convinced this activity was going to cause long-term damage.

    Perhaps you make 114 sales on 115K calls, but how many people did you turn off in the process?

    @458, do you have any feedback/thoughts on how this has affected your brand? Certainly a consideration to manage.
     
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  19. GoodShakers
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    GoodShakers Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Do your reps use an automated voicemail drop? Saves a massive amount of time if they're currently leaving voicemails manually.

    Also, have you experimented with a local dialer? It can help up connection rates, depending on where you're calling to and from.

    Thanks for sharing this stuff!
     
  20. Yoda
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    Yoda Gold Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass

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  21. GoodShakers
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    GoodShakers Bronze Contributor Read Millionaire Fastlane Speedway Pass

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  22. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    I'm not Coca Cola and neither are you. We're both cockroaches trying to make big money, worrying about brand recognition is a moot point.
     
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  23. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    Absolutely not, that is the fastest way to enter a class action lawsuit. We use five9 with local presence. Each of our 3 campaigns has around 200+ unique local numbers.
     
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  24. GoodShakers
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    GoodShakers Bronze Contributor Read Millionaire Fastlane Speedway Pass

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    Nice. Local dialing has helped me a lot in the past.

    I'm aware of some large US companies that use some variation of a voicemail drop... maybe they're doing it in a manner that I don't understand. Then again, the document @Yoda posted seems pretty clear cut...
     
  25. 458
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    458 Platinum Contributor Read Millionaire Fastlane Speedway Pass

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    In no particular order, i can tell you why you had high turn over and i don't:

    1. I know the TYPE of person to hire, you probably didn't wait for the right person you were just putting anyone on the phone that walked through the door. Males between 21 to 26 with light telephone sales experience.
    2. Your leads were probably garbage, mine our self made and the best in the business. Not to mention, the sales guys get a fresh batch EVERY WEEK like clock work.
    3. Your script was probably shit. If you have a sales guy reading a shitty script 8 hours a day hes gonna leave. Ours has been refined over the past 5 years.
    4. Your numbers were probably shit. I have access to the freshest mobile and landline numbers known to man.

    Any one of these things in isolation will cause high turnover in any sales room and i can almost guarantee it was the reason for yours.
     

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