Why Sales Development Reps may be burning your cash

Many B2B companies that use Business Development Managers (BDM) or Sales Development Representatives (SDR) to generate leads for senior sales people are pouring wads of cash down a bottomless hole. Put simply, the current approach just isn’t working.

Companies are having fewer and fewer first sales conversations. Even when a BDM gets to speak to someone the results often go nowhere. Decent leads are becoming an endangered species.

Let’s look at the numbers.

The numbers

According to Forrester Research if a BDM/SDR makes 100 calls this will generate between 2 and 4 initial sales meetings with a prospect – and only 10% to 20% of those initial sales meetings result in a second meeting (much less a sale).

This is why the cost per lead for most B2B companies is high and getting higher. At the same time, the value of deals is decreasing thanks to increased competition and the move towards subscription based services and away from high-cost capital products and services.

Something has to give.

The reasons

To quote Professor Julius Sumner Miller, “Why is it so?” Why are SDRs (I’m going to use SDRs from now on – assume BDMs are also included) finding it harder and harder to talk to prospects?

There are several reasons:

  • People are more and more busy as companies strive for more productivity
  • There are more and more SDRs chasing business
  • The amount of “white noise” – phone calls, ads, emails, web sites, social media links – is drowning everything out
  • The processes and methods most companies use for their SDRs are broken.

There’s a not a whole lot we can do about the first three reasons but there’s a lot we can do about the fourth. But when confronted with the numbers and the problems discussed above, what’s the usual response?

The usual response

The common response to these issues goes along the lines of:

  • We need more leads so we need to make more calls
  • If we make more calls it costs more money – so we need to reduce the cost of SDRs
  • That means we need more junior (therefore less well paid) SDRs or we need to outsource them to lower paying economies
  • Let’s use technology like autodiallers so we can make more calls

Not only are these responses flawed, they are counterproductive. If everyone else makes more calls it just exacerbates the problem. It becomes an arms race to see who can make the most calls.

What do you think your prospects, who are already overwhelmed with work and with constant interruptions, think of that idea?

This approach either doesn’t work or it results in more bad leads. It creates the common scenario where Sales complains that Marketing sends them useless leads that waste their time when they follow them up. Meanwhile, Marketing complains that Sales doesn’t follow their leads up quickly enough, if at all.

Often both are right.

A broken strategy

The traditional approach is broken. There are a number of reasons I’ve listed below. The most important by far is this – the SDR process is focused on the seller, not the prospect.

A quick Google search of multiple SDR job descriptions consistently throws up a standard view of the role’s requirement. This is confirmed in many articles, blogs and opinion pieces by sales and prospecting specialists.

Most people agree that the key requirement of an SDR’s role is to “Present our products and services to prospects“.

And that’s the problem.

Because – and I hate to break this to you – your prospects couldn’t care less about your products and services.

They don’t care about what you do, why you do it, how technologically advanced you are, how many case studies you have, what awards you’ve won, where your new offices are, your white papers, your brochures and where you sit in a Gartner magic quadrant.

They don’t care about your company. If you’re small they’ve probably never heard of you and they don’t want to. If you’re big and well known they probably have a misconceived preconception of what you do.

They care about one thing and one thing only (at least in a work environment).

Themselves. Their company, their customers, their KPIs, their colleagues, their responsibilities, their superiors and employees, their products and services.

Just like you do.

A New Hope

Once you understand this fact you can help your SDRs dramatically improve their performance and numbers by looking at your strategy through the eyes of your prospects.

Because while your prospects don’t give a damn about you and what you do, they might care very much about what you can do for them.

So your strategy needs to focus on that, not on yourself.

Let’s look at the traditional approach and compare it to the prospect oriented approach. This has the effect of turning everything you’ve ever thought upside down – so hang on to your hats. Some of the problems are:

Many SDRs are wet behind the ears

Who do you want your SDRs to call?

Decision makers. People with Authority. People who put the “A” into BANT. By definition, these are senior business people who have significant business and/or technical problems. People who know their company, their problems and their business inside out.

People like you.

So tell me, do you want a 25-year-old SDR earning $60,000 a year with little or no real life business experience, someone you’ve never met and who you don’t care about, to interrupt your busy day and try to talk to you about your business issues?

If you’re serious about improving your SDR team’s results by focusing on your prospect, not yourself, you need SDRs who have the skills and experience to talk to prospects about their business issues on their level. People who can provide insight, hold an intelligent conversation and demonstrate they know what they’re talking about.

Everything you know about qualifying is wrong

When you speak to a prospect you need to know he or she has sufficient authority to make a decision, you need to know if they have a budget, a need and ideally a time frame? Otherwise, you’re wasting your time. Right?

Right – maybe! Or to put it another way, not.

Look at it from the perspective of a prospect. If the primary focus of a call is to determine if they are important enough to talk to and rich enough to buy stuff from you, it isn’t exactly the beginning of a beautiful relationship.

Qualification is done entirely for your own purposes, not for the prospect’s, and he or she is already disinterested enough when you interrupt his/her busy day without you weighing him up like a fish to see if you should throw him/her back or not.

Do you need to know if they have authority? Of course – but shouldn’t you know that before you call?

Do you need to know if they have a need? Absolutely – but shouldn’t you only be calling organizations where there’s a good chance they will have a need?

Do you need to know if they have a budget? Maybe – but if they have, someone has helped them set that budget. If they’ve got as far as setting a budget they have almost certainly already talked to other vendors and those vendors have the inside running, not you.

But if you catch them before they have a budget – and you know how to help them along until they set one – you can get the inside run.

Do you need to know if they have a timeframe? Yes – if they know themselves, but what if that timeframe is next year? Do you toss them aside and forget them, focused on making this year’s numbers or do you have a program to nurture and educate them so that when they are ready you have a trusted relationship in place?

For far too many B2B companies the answer to that last question is NO.

The primary purpose of any call shouldn’t be qualification, it should be to begin a relationship and talk about the prospect’s business issues in their terms. Qualification should be a side effect, not the reason for the call.

What do you talk about?

Many SDRs’ strategy goes something like this.

I’d like to talk to you about how we can help you fix this problem. Do you have a moment?

“Great. We have this wonderful product that fixes that problem, but rather than talk about the problem (or perish the thought, ask you intelligent questions to help me understand your perspective) I’m going to bore you rigid with references, product specifications, lists of people who use it and case studies that blend with every other case study everyone else does.”

That isn’t the fault of the SDRs, by the way, it’s the strategy they are taught.

By doing some simple things – talking about the business issues, asking perceptive questions, taking the time to understand the prospect’s perspective, discussing the impact on the prospect and NOT talking about the solution until you fully understand their viewpoint – you can dramatically increase the number of first sales conversations AND subsequent second conversations.


If you could make contact with every single prospect in your total addressable market right now and have a meaningful conversation about their business issues, understand their priorities and agree they have a need – how many current sales opportunities would you uncover?

More than you have now, for sure.

But you would probably find that less than 5% of these prospects are actively looking for a solution to the problem you help solve right now.

Why? Because they have lots and lots of other problems and there’s a limit to how many they can focus on at any one time. They may have a need but they also have many other needs – many with a higher priority.

So what do you do?

The ideal answer is to provide them with some valuable information, to keep sending them relevant materials and insights and to start them on a nurturing and education program. One that ensures that when they are ready to focus on the problem they have a relationship with you, you know lots about them, they understand how you can help them and you’re on the way to developing a trusted relationship.

But the more usual answer is “no opportunity here, move on, next call“. And the longer term opportunity is lost.

Burning your brand

We’ve seen that 100 calls usually lead to between 2 and 4 first consultative meetings.

But what about the 98 to 96 calls that didn’t result in a first meeting? What impression did that leave on them? What will those people do the next time you call them, then the time after?

If your approach is more calls, more campaigns, faster qualification there’s a real danger you’re leaving a trail of annoyed people and creating lasting damage to your brand.

If you have an infinite market and you can afford to churn through prospects in order to find a few lumps of gold among the dross you might get away with this approach. But if, like most B2B companies selling high-value solutions, you have a finite market you really can’t afford to burn your brand by bothering prospects with multiple unrelated sales calls.

More leads, more calls

That’s the normal thought process. We need more leads. In order to get more leads, we need to make more calls. In order to make more calls within our budget, we need to increase call targets, hire cheaper people, do more of the same only faster.

It doesn’t work.

You don’t need more leads. More bad leads waste your sales executives’ time following up and it poisons the relationship between sales and marketing.

What you need is more high quality leads with trusted relationships in place. Leads where you already know what the prospect needs, what they believe, what they value and what their priorities are.

Leads where the prospect knows you understand their business issues, where they trust you to help them, not just try to flog them stuff. Where they know the information you send them will be useful and relevant, not standardized marketing stuff.

Leads where the sales executive can walk into a warm relationship and build upon it to help the prospect, shorten the sales cycle and increase your leads to sales ratio.

Leads that help the sales executive to succeed. Leads that make the sales executives’ eyes gleam with anticipation, not sigh with exasperation.

You don’t need more calls. You need more business conversations

You don’t need more leads. You need more high quality leads with trusted relationships in place.

And right now the vast majority of SDRs aren’t generating that kind of lead.

Digital Marketing

Digital marketing – emails, social media, etc. – is a critical component of any prospecting approach and can be enormously effective – but as a component, not by itself.

I wrote an extensive article on the subject titled “Why Digital Marketing is failing in Enterprise Accounts” and I’m not going to repeat that here except to say that digital is great but taken alone it isn’t enough.

The Solution

This isn’t meant to be a commercial article but as I’ve clearly defined the problem it’s incumbent on me to define the solution. And as the CEO of a company that has delivered high-quality pipeline with trusted relationships in place to major organizations including Adobe, Amazon Web Services, Commvault, Fujitsu, Google, IBM, HPE, HPI, Microsoft, Nissan, Optus, SAP, Telstra, and VMWare I can only talk from my own experience.

So here’s the solution.

Data Strategy

Everything begins with data. Every call made to a company that is too small, that doesn’t have the need for the solution we’re promoting or that can’t afford to buy it is a waste of our Clients’ time and money.

Before every campaign, we put in a lot of effort with our Clients to make sure we’re targeting the right companies and the right people in those companies. We use sophisticated Predictive Analysis to identify the right targets. We provide detailed Contact Discovery that uses social media, the Internet, our Clients’ data and the telephone to make sure the data is as accurate as possible.

We aggregate all existing data on target companies and individuals from multiple sources – our Clients’ CRM, lists of event attendees, email lists, marketing campaigns, ERP systems and so on – into our in-house Integrated Marketing Database to give us a 360-degree view of the prospects.

We update the centralized data on a regular basis depending on the source and we use it to record insights, create notes and record all communications with the prospects via many different channels (conversations, emails, etc.).

When we communicate with a prospect we know who has said what to them, when, how and what was said so we can build on that every time we talk.

Messaging Strategy

Before we begin any campaign we develop a structured, persona based messaging strategy that focuses on the business problems our Clients can solve and the various perspectives of different kinds of prospects.

This allows us to define industry based and role based messaging – because the perspective of a CEO and a CFO on the impact and priorities of a particular problem can be quite different. And all messaging is initially based on the needs of the prospect and their business issues.

(Obviously, we also make sure we have an intimate understanding of the product/service, what it does, how it works and how it helps solve the problem – but we always start with the problem).

ARM Consultants

We don’t call our people SDRs, we call them ARM Consultants. ARM stands for Authentic Relationship Management – because their role isn’t to sell, it’s to consult, to learn, to educate and to build trusted relationships with prospects on behalf of our clients.

Because they are calling senior business people they need to be able to converse with them on their level. So we only hire people for this role with at least 10 years business experience. The average age of our ARM Consultants is 50 (our most senior is 70 and is an ex-CEO and ex-partner at PWC).

Whether they’re talking to a CEO, a CIO, a Head of Infrastructure or a SME owner they can talk intelligently about their problems and their issues in their terms.

Training and Methodologies

Just because you’re intelligent, mature, experienced and capable doesn’t mean you know what to do. We follow a proprietary structured methodology called Authentic Relationship Management.

We don’t let our ARM Consultants loose on our Clients’ prospects – no matter how experienced they are – until they have studied and are certified on our 16 module ARM Business Platform training program that covers our methodologies, our tools and the way we approach prospects and Clients.


Obviously, we have very specific targets but they aren’t all based on sales accepted opportunities. The number of sales accepted opportunities is just one of our ARM Consultants’ KPIs and they occur as a by-product of the many other things we do. But when they do occur they are true leads with a trusted relationship in place, measured by the sales reps enthusiastically accepting the opportunity as a genuine one.

But our main focus is much more on holding meaningful conversations, building trusted relationships, measuring the strength of the relationship, sharing relevant collateral at the right time, understanding and sharing insights into their industry and their issues, identifying their time frames and building a view of a future pipeline.

As a result we gather valuable market information (that can be used for Challenger Selling), share insights and provide value to the prospects, identify which collateral is seen as valuable and relevant – and as a result, generate rich sales accepted pipeline with strong relationships in place.


Our focus is on quality conversations rather than calls.

You can’t make 100 calls a day and have lots of meaningful business conversations. Our ARM Consultants aim to close 15 calls per day but the number of meaningful conversations we have is very high and the ratio of first to second conversations is over 60%.

Summary – Achieving More by Doing Less

Our motto is “Achieving More by Doing Less“.

The current trend of work faster, work harder, more calls, more leads has failed. It’s become a case of more hamsters running on more treadmills producing more noise to little effect.

We work hard, we work fast but above all, we work respectfully and intelligently. We follow a structured methodology that’s considered, consistent and that works – because our focus is on the prospect and their perspective.

And that’s our advice when people ask us how they can help their SDRs (and BDMs) to deliver the results their companies are demanding.


Please share: You may not know it but LinkedIn no longer notifies your connections when you publish an article – so the only way people find out about an article like this is if people like you share, like or comment on it.

So if you found this post interesting or useful please “like” it and share with your contacts on LinkedIn & Twitter to help it reach a wider audience.


Go to our website:   www.ncmalliance.com


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