The importance of prospecting

By John N. Brennan, Shipley Associates

Potential customers come in two types: suspects and prospects. A suspect is someone who appears to fit your target market or shows some interest in your offerings; a prospect is someone who has the money, the authority, and the desire (MAD) to become your customer. The function of prospecting is to identify and attract suspects and then convert these suspects into prospects. In business-to-business sales, your typical prospecting objective is to get an appointment with a partially qualified prospect to fully qualify them.

Successful prospectors know that to succeed they need to:

  • Make prospecting an integral part of the sales pipeline.
  • Create a defined and daily routine.
  • Create a sense of urgency as they prospect.
  • Keep cold calls simple.
  • Ask for referrals.
  • Determine when to use a script.
  • Be persistent.
  • Pursue only qualified prospects.

Selling is a matter of converting suspects to prospects and prospects to customers, a process often referred to as the sales pipeline, or sales funnel. Suspects first appear as sales leads at the beginning of the pipeline. Sales leads are generated either by a sales representative who searches for suspects or by marketing programs that attract suspects to a company's offerings. Typical marketing programs include direct mail, opt-in e-mail, trade shows, advertising, Web site hits, showcase events, and telemarketing. Other sources of sales leads are public relations, referrals, and cold calling.

Prospecting is a critical practice in sales; without it, there would be very little sales activity at all. Some sales organizations divide their staff into those who prospect to open new accounts and those who develop existing accounts. Others believe that every sales representative must master prospecting and that the best way to grow existing accounts is to prospect within them.

To become a successful prospector, you need to follow some basic guidelines.

View prospecting as an integral part of the sales pipeline

Prospecting is not something you do when you have time or something that you rely on others to do, but a routine first step toward a sale. Accept that you have to consider a lot of suspects to find a prospect, and consider one suspect at a time.

Prospect systematically

Whether you organize your prospects by geography, vertical market, or sales volume, you need to prospect systematically. Increase your prospecting not in an impulsive flurry of phone calls, but in a confident, methodical way.

Develop a plan, implement it, and review your progress on a regular basis. Adjust your plan based on results and feedback. Half the battle is developing a routine that works for you.

There are several reasons for prospecting systematically:

  • You are less likely to lose good prospects.
  • You know when you have fully covered a specific market segment.
  • You use your time more efficiently.

Prospect daily

Prospecting should be part of every sales person's daily routine — not a weekly or monthly activity. If you want a steady supply of prospects, you must have a steady supply of leads. Don't rely exclusively on marketing, advertising, Web sites, or call-ins for leads. None of those will be as good as the leads you generate yourself.

Invest a couple of hours each day in prospecting. It provides some relief from the pressure of face-to-face sales calls, and you will be amazed at how many suspects you can meet in two hours.

Create a sense of urgency

Every conversation, voice mail, and piece of literature should move the suspect to some action, no matter how small. The best way to do this is to offer plenty of benefits, as shown in the following example:

"Mr./Ms. O'Donnell, we have a new/updated/revolutionary/breakthrough/unique..." (Create urgency.)
"... idea/program/concept/solution/system..." (Never say "product.")
"... that will save you money/make you money/improve productivity." (Name the benefit.)
"I'm offering you an opportunity today to evaluate/see for yourself/determine..." (Let Mr./Ms. O'Donnell know they are in control.)
"... whether it will be of benefit and value to you." (Answer the question, "What's in it for me?”)
"Our senior account executive/director of sales/customer relationship manager..." (Never say "sales rep." This is too important and urgent.)
"... will be in your area tomorrow." (Not a week from Friday. Remember, this is urgent!)
"Are you in at 7 A.M. or 8 A.M. tomorrow?" (Be specific. Don't ask, "When do you have time?" Again, create a sense of urgency.)

Keep cold calls simple and polite

All sales representatives are familiar with cold calling, which is the practice of systematically contacting targeted suspects by telephone or by visiting their businesses.

To improve your cold calling results, remember these tips:

  • Develop a routine    Plan cold calling, and don't let other activities distract you.
  • Experiment    Try different times of the day and week until you determine the most productive time for cold calling.
  • Collaborate with peers    Learn from others in your organization or in similar sales roles. Don't reinvent the wheel; find out what already works.

If you are wondering about those "No Soliciting" signs, try this:

"I'd simply like to drop off my business card/literature for your <job title of ideal prospect>. May I have one of his/hers in return? Thank you — and, by the way, what is the best time to reach him/her? Thank you. Have a great day."

Now, that particular cold call to the suspect is a little warmer than it otherwise would be.

Ask for referrals

Referrals should be one of your prime sources for generating leads for new business. At the end of each call, ask your sales contact whether he or she knows of anyone else who would be interested in your product, whether or not you closed the sale. This referral can be an effective door opener.

Here are a few door-opener approaches you might try:

  • Service approach    Get your customer's attention by offering a service right away. "Good afternoon, Mr. Earls. This is Carol Philips of Fabrikam, Inc. Many of our customers find that our new Bolts-to-Go service is a convenient way to shop for hardware."
  • Endorsement approach    Nothing works like a referral from a friend, colleague, or even a competitor. "Good morning, Mrs. Eaton. This is Andy Teal of Contoso Pharmaceuticals. One of your associates, Kathie Flood, suggested that you might be interested in some ideas to manage your inventory."
  • Limited-opportunity approach    Deadlines, limited offers, and once-in-a-lifetime opportunities present strong motivators. "Hello, Mr. Ito. This is Syed Abbas of A. Datum Corporation. We're running a special sale on software upgrades that I know you'll want to take advantage of. The sale ends at 5 o'clock this afternoon."
  • Special-fact approach    News about your customer's business gets attention. "Good day, Mr. Uddin. This is Bob Gage of Blue Yonder Airlines. I just received the results of a helicopter usage study of companies like yours."
  • Special-offer approach    "This month, you'll get an additional 12-month service warranty free." Or "If you order a six-month supply, we'll defer billing for 60 days."
  • Survey approach    "Your industry's association reported that almost 73% of the companies surveyed had problems with over-inventory. What is your experience?" To gather this kind of information, read the business pages, read the trade publications, and talk to colleagues and other people in the firm you're contacting.

Determine when to use a script

In pulling together your sales message, you need to choose between using a script and using a prompt guide. A prompt guide is a list of key questions, topics, or statements that you can refer to as the conversation with the suspect proceeds. If there is low risk of legal impact during your introductory call and if the information you're introducing is not highly technical, a prompt guide might be more effective than a complete script.

Use a script when:

  • Your message must be concise.
  • Your service or product is complex.
  • Your customer is unfamiliar with your product.
  • You are an inexperienced telemarketer.
  • Legal issues might be involved.

Be persistent

Call early in the morning. Leave your sales pitch on voice mail. Call again later in the afternoon. Enter results in your contact management software program. And continue calling each day until you make contact.

According to a recent National Sales Executive Association survey, sales professionals make 80% of all new sales in their fifth call to the same prospect. So, review your prospect list regularly, and be persistent with your calls.

Pursue only qualified suspects

Your goal is to find customers who are buying. You must relentlessly and rigorously qualify your suspects.

Pursue only those prospects who are fully qualified, not those you think might be qualified, those you wish were qualified, those who used to be qualified, those who are partly qualified, those who give the impression that they are qualified, or those who themselves want to be qualified.

Increase your prospecting activity, but before you even begin, do your homework on which prospects are worth pursuing.

About the author     John N. Brennan is a Senior Consultant with Shipley Associates, a professional services company focusing on sales and business development consulting, training, and process improvement.

Applies to:
Access 2003, Excel 2003, Outlook 2003, PowerPoint 2003, Project 2003, Word 2003