In our past article we spoke about developing your startup sales funnel. In the next step of creating the sales process we’re going to talk about the prospecting process and how can we generate more leads with outbound techniques.
We have also created a canvas to help you along the process of searching for potential customers, which you can see below. If you're interested in downloading it already, you can do so here.
So, let’s dig in!
Target Market and Decision Maker
When you start a prospecting process the first step you need to take is to identify your target market and the decision maker. Besides knowing the target market and the decision maker, you might need some additional info like the company website, number of people of the sales team, etc.
The additional data will help you better identify your target market, segment your prospects as well as to personalize the cold approach and to increase the reply rate. Of course, there could be more target markets and more decision makers and you should consider a different approach or message for every buyer persona in particular.
Now that we know who our potential customers are, we need to identify the channel they spend most of their time on and how can we reach out to them. For example, if they are very active on LinkedIn, an efficient method could be to send them private messages on LinkedIn, or do a cold emailing campaign if you know they are checking their email regularly.
In the beginning, you may be disappointed by people that will only see your message and won’t reply to you. But you have to know that the conversion rate from people that you reach out to versus people that reply to your message isn’t so great. For example, for an outbound cold emailing campaign, the reply rate is between 7% to 17%.
A few things you can do to improve your reply rate is to use an attractive subject line, relevant to the content of the email and not being too salesy. Another tip is to personalize your body email/message as much as you can. This thing applies to any kind of reaching out (cold emailing, cold messages on LinkedIn, cold call, etc).
A key factor for increasing your reply rate is to always follow up.
After you’ve defined your process, the next step in prospecting is identifying how you can automate the process. You just have to analyze what stages of the process took the most time and find a way to automate them.
There are a lot of tools that can help you with that. Thanks to the guys from Reply.io you can find a list of tools that can help you in the prospecting and the entire sales process here.
And, because you want to have a clear picture over the progress and see how the process can be improved, it’s very important to also have some performance indicators.
In this case, you basically have 3 main metrics:
- the number of people you’ve reached out to;
- the number of earned opportunities;
- the conversion rate between Opportunities and Prospects ((O/P)x100).
Of course, there are other metrics you could look at. For instance, when you’re contacting people, you might want to look at your reply rate or open rate for your emails. Here is another article with more details about cold emailing and metrics for it.
Okay. We’ve talked a lot about the Prospecting Process, but let’s also take an example to better understand how it goes.
Let’s assume that you are the founder of a meeting appointments software and you want to increase the number of users for your platform. One of your target markets is represented by people who are working in sales and usually have more than 10 meetings/calls per week.
We assume that their problem is that they don't have a very practical way to help their clients easily schedule a Demo/call with them. They are exchanging a lot of emails/messages before finding a timeframe that suits both parties and are wasting a lot of time with this. The decision maker (or buyer persona) in this kind of companies is the VP for Sales/Business Development Manager/Head of Sales, etc.
You choose to contact 100 of them via LinkedIn, 100 via Cold Emailing and 100 by Cold Calling and the results are the following: you’ve earned 10 Opportunities by LinkedIn, 20 by Cold Emailing and 20 by Cold Calling.
When you gathered the info about the prospects, you noticed that it took a lot of time to build the database and to send personalized emails. By doing a little research on the internet you’ve found out that you can use a scraper to obtain the info needed about the prospect and a tool like Yesware helps you to send automated emails. Also, by automating this process you've noticed that you’ve earned 10 hours per week that will allow you to contact more prospects.
When it comes to performance indicators you see that you’ve reached out to 300 people, you’ve earned 50 opportunities and your conversion rate is 16.66% ((50 opportunities/300 prospects) x 100).
You can check out the visual example of the sales prospecting process according to our case study:
And you can download it by clicking here.
That’s about it regarding the prospecting process. Hope you've enjoyed this article and that you learned something new. You can download a blank version of the canvas below. Don’t forget to share the article with others and subscribe to our blog to be notified when the next article from the sales for startups canvas series is posted.
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