Cold Calling – A Beginners Guide for Small Business Owners

Cold Calling – A Beginners Guide for Small Business Owners

Cold calling is an essential sales activity that generates new customer revenue and helps your business grow. While many salespeople relish the chance to simply pick up the phone and win a new client, others find it challenging and frustrating. This guide uncovers the mystery of cold calling with simple step-by-step instructions to make your calling more successful.

If there’s one thing that cold calling absolutely requires, of course, it’s a phone line. Many businesses today are opting for VoIP services over traditional landlines.

What is Cold Calling?

Cold calling is often the first step of the sales process. It typically refers to a phone call made to a prospective B2B customer with whom your business has had no previous relationship. The call aims to identify the decision maker, assess the need for your product and secure a pitch meeting if a sales opportunity exists.

When performed well, cold calling is an important business enabler. It’s also an activity that successful small business leaders relish, as it puts them in control of their own destiny. Without cold calls and/or lead acquisition campaigns supported by cold calls, it is difficult for a new business to generate the revenue they need to get their business off the ground.

cold calling

Key Stages & Techniques for Successful Cold Calling

Let’s go through each step required to make a successful cold call:

1. Set your objective

I would not recommend cold calling for making a sale. Rather use cold calling to identify and make first contact with prospective customers, qualify prospective customers in or out and secure a pitch meeting opportunity.

Whatever your objective, be clear about what it is before you start and stick to it. For example, “I am aiming to connect with 50 prospective customers with the objective of securing f2f meeting opportunities with 5 of them who have a current need for the products and services that I am offering.”

Here are some additional objectives that you could target:

  1. To test demand for the products and services you provide.
  2. To work out how best to communicate your value proposition
  3. To identify the customers with the greatest need for your product
  4. To gain insight into what price customers will pay for your solution
  5. To clarify the best decision-maker role(s) to target?
  6. To appreciate how easy it is to arrange sales meetings
  7. To understand what the most frequent objections will be

2. Identify your targets for outreach

Once you have defined your objective, it’s easier to know which organizations you need to call and whom you need to speak with too. Most salespeople use Google Search to find the organization website and build some context about who they are and what they do. You should also use LinkedIn to identify the right person in the organization to speak to and learn a bit more about them too. I also check my prospects Twitter feed (if they have one) because it gives you an idea of what they are currently thinking about.

3. Send pre-sales marketing materials (Optional)

Sales experts differ in their views on this subject. Some sales experts like to have the support of marketing to warm-up leads with digital marketing promotions ahead of calling. This is because it can help to build awareness and position your business ahead of calling, which can make it easier to get through to decision-makers.

However, other sales experts believe that being reliant on marketing to generate and execute sales campaigns slows them down and potentially blocks opportunities before they have had the chance to speak to decision-makers and pitch for themselves.

In my opinion, you should try both approaches and see what works best for you. In either case, you should always send some information following a successful cold call— but make sure this is just a taster so as not to steal the thunder of the sales pitch you will go on to deliver next.

4. Script vs no script

You need to be able to grab your contact’s attention in less than 30-seconds. As a result, it makes sense to work out how you are going to introduce yourself, introduce your business and explain the purpose of your call. The purpose needs to focus on something likely to be of interest to your prospective customer.

This is why businesses often use cold calling scripts to standardize their introduction and how they respond to common objections. However, sticking rigidly to a script can limit your ability to create a natural dialogue and build trust. This is why scripts are increasingly used as discussion frameworks, which salespeople to use as a guide and not as a rigid process.

Try not to forget: this is a two-way communication process, so you need to learn from the prospective customer that you are calling. For example, think carefully about what information you need to gather to be able to qualify whether the organization has a need for your product and whether the person you are speaking with is the right person to sell it to.

5. Relax and be yourself

When someone tells you to relax, the last thing you feel is relaxed! But seriously, if you come across as human and likable then you are halfway there. No one wants to hear from a stranger that’s either sounding like a robot or riddled with fear. Here are some tips that help:

  • Make sure you are breathing normally. I do Yoga, it’s not for everyone, but I’ve learned how important breathing is to being relaxed
  • Make sure you are using a cordless phone so that you can walk around freely. Lots of people like using a headset so that they can take notes.
  • Learn your script and then put it to one side, so you let the words come naturally.

6. Open with the reason for your call

The key thing here is to make this all about the customer, for instance:

“Jeremy, this is Mark Sallows, and the reason I am calling you is….”

Open with energy and be upbeat about why you’re calling. This helps to get their attention off what they were doing before they decided to accept the call from you. If you are clear, concise and straightforward you’ll get the chance to elaborate at the next stage.

7. Now tell them what’s in it for them

For example, “The reason I am calling is to show you a new way to increase your sales.” If you are not able to state the benefit of your product to their business with real conviction, then you need to practice this until it feels natural and you can get your message across with confidence.

8. Anticipate questions, complaints, and objections

You must be able to predict the possible responses from the person you are calling. Make a list of possible responses, questions, complaints, and objections with answers that you can offer quickly.

The reality is that you will not be able to do this before the first call, so each time you come across something you have not encountered before, consider adding it you to call notes.

9. Agree on next steps and close

If the call is successful, make sure to agree on the next steps. Try to take the lion’s share of yourself, as this will help to ensure that the process does not stall due to your future customer being too busy to complete their actions. Then, if appropriate, make sure to secure your purpose for the call, for instance:

“Jeremy, I’ll send you a meeting invite and a little more information about what we do. Could you arrange a meeting room and I’ll come to you?”

10. Write up your contact notes and next steps

With a clear objective identified before you start calling prospective customers, you can now evaluate the information you have gathered from your call and develop a plan for the next stage, which in my example is a pitch meeting. I recommend using a CRM system to help manage your data from cold calling.

As you evaluate more and more calls, you should try to identify any repetitive patterns or trends. For example, if your contacts consistently ask for a fact-sheet on your services, for case-studies or for references, then it makes sense to put these in place.

Outsourced vs. In-House Cold Calling

There are some great specialist cold calling agencies out there, who provide an excellent cold calling service at a cost.

However, totally outsourcing your cold calling activity is not something that I would recommend to any small business. Why? Because you lose control over first human contact with your customers.

A better strategy would be to work out how to do cold calling for yourself, put a system in place and hire a cold calling salesman in-house to help you make cold calls. Once you have proved how many cold calls you can make in a week and how many you can convert into pitch meetings, then you can consider partial outsourcing to accelerate the process.

My next step would be to optimize the cold call process by ensuring that all cold calls are recorded within a sales CRM system.

cold calling

Then, once I have my system setup and I have established call volumes and conversion rates, I would consider outsourcing up to 80% of cold calling to a reputable cold calling agency that are happy to work in my system. This is important as it allows you to measure performance and see what you are paying for.

I would always keep at least 20% of cold calling in-house as it allows you to retain an objective benchmark of the performance metrics you expect to achieve and easily allows you to pull cold calling back in-house if necessary.

The Right Mindset for Cold Calling

Cold calling is widely considered the most challenging aspect of sales by the people that should know best – salespeople. Viewed this way, cold calling is merely a numbers game, where the salesperson is like a mass mailer. Somebody might respond, maybe 1 in 25 or 1 in 100. This is the way that unsuccessful entrepreneurs and salespeople view cold calling: It’s a painful, embarrassing activity to be avoided if at all possible.

In addition, these salespeople would say that cold calling is more difficult these days because the prospective customer is increasingly time-pressured, and can find the information that they need on the internet without the need to talk to salespeople.

However, it’s important to understand that the best entrepreneurs and salespeople really enjoy cold calling. They see its value and they insist on making cold calls themselves.

There are 5 key reasons why:

  1. Cold calls generate new streams of customer revenue, and if you know how to do it well, you can define your business’ destiny and steal the march on competitors.
  2. Cold calling is far from restrictive once you become good at it. It is very liberating and allows you to connect with your customers naturally, whenever you feel the need.
  3. Successful entrepreneurs tend to make cold calls because they like to make things happen; for themselves, for their business and for their customers. They do not like waiting for other people to make things happen.
  4. The objective is not to sell, but to explore starting a new business relationship built on trust. When this is understood, it’s not at all embarrassing to make cold calls.
  5. If people are clear that they do not have a need, take this as helpful feedback. It allows you to qualify them out so that you can focus your time on relationships that have real potential. If you qualify well, you will tend to convert at least 1 in 3 prospects that you eventually go on to sell to.

If you have received calls from a poorly trained cold call salesperson, then you will already know that it can be a repetitive, unimaginative and thankless activity. However, it does not have to be this way. Cold calls can be open and honest, professional, straightforward and helpful to the customer and the cold caller alike.

6 Cold Calling Tips to Achieve the Right Mindset

To make successful cold calls you need to take the following 6 principles on-board:

Shift your mindset to being helpful rather than trying to sell

Look for what the other person is thinking and whether there is a real need for your product or service. Aim to qualify the need, the timeframe and confirm that the person you are communicating with has the authority to make a purchase.

Build trust and earn the right to sell

Your objective is to build trust and the opportunity to speak again or meet to make a pitch. Creating trust builds relationships and trying to sell before you have established trust is not productive.

Listen and be flexible

The key to any successful conversation is the ability to demonstrate that you value and respect the person you are communicating with. The best way to establish this is to ask questions and then really listen to what the other person is saying. Be flexible regarding where they want to take the conversation. If you ask people questions that are well thought out and you are interested in their answers, they will view you as intelligent. Why? Because you are smart enough to seek information before jumping into what you want to say. You also demonstrate that you value them and what they have to say.

Confidence is key

If you would not buy what you have to offer, you should not be trying to sell it to sell it to anyone else. Let’s face it if you can’t get excited, or you are embarrassed, why should anyone you’re dealing with feel any different?

Timing and commitment is key

The best times to call businesses that operate on a 9 to 5 business day is usually Tuesday and Thursday afternoons. I recommend blocking out these time slots in your calendar to ensure that your cold calling time is not squeezed out during busy weeks.

Maintain a great attitude

If prospects are impatient, stay positive. If prospects are rude, stay positive. If prospects put the phone down, stay positive and do not let it impact the next call. The reality is that some people are impatient and rude. Sometimes this is because they have received pushy and badly conceived cold calls in the past. If you stay patient and polite they will soften and their guard will come down.

The Bottom Line

Cold calling is often misunderstood because many of the people who make cold calls are not doing it properly. They are trying to sell rather than take the first step to develop a new relationship, and often lack integrity. However, cold calling done well is a very valuable activity for you, your business and the future customers you are connecting with.

Remember, always set your objective before starting to make cold calls. Listen to your future customer and be prepared to be flexible to wherever they want to take the conversation and make sure to place building trust ahead of starting to sell to anyone.

Finally, most people find that sales CRM tools to help them to record call data, notice recurring patterns and manage next steps more efficiently. Check them out and find a simple CRM tool that works well for you.

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