Referral call vs. cold call: What’s the difference?

With 250 training centers around the world, one topic repeatedly is among the most common that clients bring up. It’s about efficacy of cold calling as a prospecting technique to generate new business for their company. However, I can often sense from the way the question is asked that it’s not a question at all but a hope that we’ll validate their opinion.

It might sound like this: “I hang up on telemarketers when they call me. Is anybody finding that cold calling works anymore?” Or, “Our people used to be able to set appointments and generate new business using the phone, but with voicemail and texting and newer technology, we’re finding that things like email and LinkedIn are more effective.”

In these examples, we have to ask a few questions in return to figure out what is really happening in the organization, at the salesperson level:

Are your people making dials and having trouble getting past gatekeepers?

Are your people ending up in phone trees and voicemail, not getting returned voicemails?

Are your people able to connect with a live decision-maker, but unable to have a meaningful conversation that results in an agreed-upon next step of some sort?

In general, do your people prefer to use things like email to communicate? Have they been conditioned to not use the phone?

As you can see, a myriad of factors go into evaluating a phone prospecting strategy. We’ve left one off the list as it is very specific to each industry: Where did you get your prospect list and is it a good list? That’s a much larger topic for a much longer discussion.

We see a growing trend for salespeople to default to passive, less direct forms of communication. We believe some of this is driven by the control it gives the prospect to not be evasive and avoid answering questions and/or “being sold.”

Our belief is that direct human-to-human selling is nothing more than a conversation or series of conversations. Sure, email is great, a way to provide some detailed information and get confirmation on issues. However, it will never be as effective as human-to-human conversation for things such as understanding what the prospect is really saying and their real reasons for wanting or not wanting to do business with you.

The points listed above are all moot if the sales team or salesperson is reluctant to pick up the phone. Just last week, we were challenged by an underperforming salesperson on a client’s sales team. He said. “Cold calling doesn’t work anymore.”

Upon further discovery with this salesperson, we came to find out that he didn’t have a daily/weekly behavioral plan that tracked his quantity of leading indicators (prospecting attempts, voicemails left, voicemails returned, meaningful conversations, appointments set etc.). At the end of the day, he justified his call reluctance with personal bias as he had no tracking mechanisms to validate whether or not he was even doing his behaviors or if they were working.

Let’s pretend that cold calling doesn’t work (and for many industries it probably doesn’t). Most businesses love getting referrals. However, consider this Sandler Rule: The only difference between a referral and a cold call is the first eight seconds. Have you ever received a referral, connected with the referral only to find out that they’re really not a qualified prospect? All prospecting is is sorting through suspects and prospects. Trying to see if the suspect is a prospect. We do that by having a conversation. If they’re qualified, great, we move on in our process. If they’re not, they move to the lead nurture stage and we still move on; ideally to more prospecting. It’s a fallacy to believe that every inbound lead is qualified and that we have the magic marketing dust to only attract 100 percent qualified leads.

Hockey legend Wayne Gretzky was quoted as saying, “You miss 100 percent of the shots you don’t take.” For many salespeople, the problem isn’t whether or not cold calling works, it’s whether or not they’re even doing anything near the appropriate level of prospecting that’s needed for them to be effective in generating new customers. Are your salespeople?

Bob Bolak is president of Sandler Training. He can be reached at 303-579-1939 or bbolak@sandler.com.

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