For those of you who have been following my articles for a while, you might remember an earlier blog post I wrote titled “Why you Should Stop Cold Calling.” I also edited a video for TRO called “Why we Quit Cold Calls.” So as you can already tell, I’m not a fan of receiving or making cold calls.
To give a little history, I have done many different kinds of sales: Door to Door, Email, Networking, Cold Calling and Retail. I have been awarded numerous sales awards over my career, including “Highest Market Share Growth in the Entire Company.” So When I say cold calling is obsolete, I’m not just blowing smoke.
I’m not alone in my opinion either. Several high-profile sales trainers and business owners agree that cold calling is the least effective method of selling. Influencers like Dan Lok, Gary Vaynerchuk, and Kevin Ward all acknowledge that the ROI on cold calling is declining and has been for some time. When it comes to lead generation efforts, Neil Patel doesn’t even list cold calling as an effective option. In fact, Hubspot states cold calling only results in a meeting 1% of the time, and that is JUST a meeting!
Source: Neil Patel
Who Still Defends Cold Calling?
Not everyone agrees that cold calling is dead however. Big influencers like Grant Cardone still advocate for cold calling and I still see tons of comments on social media vouching for the practice. I see comments like the one below all the time.
The problem with these defenses however, is that the people defending them often come from big companies that have a lot of brand awareness. This means that most of the work of building up credibility has already happened as soon as they say what company they are from.
The top comment in the image above already mentions this fact. “I’m a sales agent for Scandinavia’s biggest insurance company…” Think about that for a moment, chances are they have already heard of your company and have millions of dollars of backed influence through marketing to help form an opinion of themselves.
I’m from the United States, as are many of my readers. We are all familiar with Insurance providers like Allstate and Geico. Imagine 2 sales people cold calling 2 different prospects out of the blue. One is from Allstate and the other is from a small insurance company called “Joe’s Insurance.”
Both agents state which company they are from. Chances are, the agent from Allstate’s prospect already has awareness of the company and has a level of trust associated with that brand, assuming they didn’t have a bad experience with them. The agent doesn’t have to really build that credibility.
Now let’s look at the agent from Joe’s Insurance. The prospect has never heard of this company and doesn’t even know if the person calling is a legitimate sales agent. The agent is going to have a lot harder time building up trust than the person from Allstate.
I would even go as far to say that the person from Allstate has a better chance of converting a prospect that had a bad experience than the agent from the unknown insurance agency does. This is because credibility and trust are key for cold calling because people HATE being cold called. It’s one of the few saving graces that can stop someone from just hanging up on you immediately. If they haven’t already screened your call.
This applies to Grant Cardone as well. People know who he is. People know that he is an expert in his field. He doesn’t have to build that credibility over the phone because he already has it wherever he goes.
What Issues does Cold Calling have?
The problem with cold calling is well known. People don’t like making cold calls and people don’t like receiving them. On top of that, cold calling can be a time-consuming process. If cold calls are successful 1% of the time, That means I have to make 100 calls before I get one meeting out of them on average.
Just imagine how long that could take! When I did cold calling for B2B, the fastest I was able to go was 30 cold calls to 30 different prospects in one hour. That would mean it would take me over 3 hours to reach my 100 call mark.
I can reach more than that doing an email campaign and have it run for me in less than 10 minutes. Prospects are also more responsive and less put off by email than they are at cold calls so I’m more likely to get my message across to them.
That’s right, using cold email I was able to get far more engagement than the average 28% for cold calling. Even my lowest rate was 2.87% more effective than cold calling. My highest was a whopping 22.74% higher engagement with email than with cold calling.
Prospects are wising up to traditional sales tactics. The effectiveness of cold calling has dwindled significantly over the years. Any company looking to grow that still relies on cold calling as their main source of lead generation needs to consider other measures to create quality leads. Otherwise they run the risk of being left behind their competition.
Want to learn more about why Cold Calling isn’t effective anymore? Check out our video “Why We Quit Cold Calls” below.