C A T E G O R Y: S A L E S S T R A T E G Y, I N S I D E S A L E S
The Rapid Rise of Inside Sales
The inside sales function
has proven its value as both
a strategic asset and revenue
generator
We believe the function will
increase in both size and
revenue responsibility based
on an ability to perform as
well as increasing cost
pressures
In general, inside sales will
continue to evolve to address
increasing account and
product responsibilities
© Copyright SiriusDecisions. All Rights Protected and Reserved.
It’s a sci-fi movie staple: the hero emerges from
the smoldering ruins of a demolished society,
looks to the sky and vows to rebuild a better
world. While the devastation of the sub-prime
mortgage economic meltdown may not reach
such Armageddon-like levels, how sales organi-
zations choose to rebuild will have a lot to say
about the prospects for a better b-to-b world.
Capitalizing on the next economic growth
cycle will require sales leaders to rethink
resources and best align a coverage model with
market opportunity. In this brief, we will exam-
ine the reasons why quota-bearing inside sales
will be an important part of this rebuilding
process, discuss the increasing capabilities of the
function and how it will be further adapted to
fulfill an expanded mission.
JUSTIFICATION DAY
Quota-bearing inside sales has seen its strategic
significance and revenue contribution increase
due to a lower cost structure; an ability to pene-
trate the SMB market; and also a growing com-
petency to sell more complex products within
larger accounts. Along with cost and perform-
ance, three additional factors further validate
this expansion, including:
• Field focus. By shifting accounts or new
opportunities to inside sales resources, field
sales reps are now forced to dig deeper into
the installed base. This will promote deeper
levels of penetration into accounts, specifi-
cally increasing cross-selling into new busi-
ness units or divisions, or upselling broader
solutions. In general, organizations that will
be launching or acquiring new products
will need greater focus on the account base
– and thus inside sales – to succeed.
• Customer acceptance. Accustomed to a
“traditional” personal relationship with a
field rep, some customers initially perceived
the coverage change to an inside rep as
being relegated to a lesser status. However,
after exposure to inside sales reps for the
variety of products/solutions they use,
many of these customers have come to
realize the benefits of having someone
readily available with access to and knowl-
edge of all pertinent internal resources and
information systems.
• Technology. The continued advances in
sales technology have significantly
improved an inside sales rep’s ability to
both manage leads and sell into the SMB
space. While core sales force automation
adoption continues to plague the field
organization, inside sales relies on it to pro-
vide call lists, leads and other information
needed to prospect and manage accounts.
Activity tracking and reporting capabilities
free inside reps from filling in reports while
providing management with valuable pro-
ductivity metrics, and Web conferencing
technologies make virtual sales calls a cost-
effective alternative to face-to-face meet-
ings. Finally, sales readiness technology
allows for expanded access to knowledge
and subject matter expert (SME) resources;
these SMEs can be more easily engaged –
and thus are more highly leveraged – when
they don’t have to travel.
INSIDE REDEMPTION
During the months and quarters to come, sales
leaders evaluating their coverage model will be
forced to consider three realities that likely will
continue to drive them toward a greater inside
sales-base solution, including:
• Percent of revenue. Our benchmark data
currently indicates that quota-bearing
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inside sales is responsible for between 10 percent and 13 percent
of revenue, and represents between 8 percent and 12 percent of
sales headcount. As organizations begin to scale to meet an
improving economy, the revenue percentage will likely rise toward
the 20 percent level, resulting in a lower-cost model and an increase
in revenue per head for both field and inside sales channels.
• Account size/complexity. When sales organizations begin to
expand, they will look to increase account responsibilities for the
inside sales channel, leveraging its experience and technology to
manage larger and more sophisticated accounts. The account man-
agement methodologies and processes utilized by field reps can be
directly applied for inside sales.
• Solution complexity/average selling price. Previous limitations to
what inside sales can sell will be lifted as inside sales has proven its
ability to qualify, develop and close opportunities of increasingly
sophisticated products/solutions with a higher average selling price.
Sales automation technology plays a large role in providing access
to product knowledge and leveraging internal resources to satisfy
customer requirements. As experience levels grow, inside sales pro-
fessionals become just as proficient as the field in soliciting cus-
tomer issues and developing compelling solutions.
ROLE EVOLUTION
The generic term “inside sales” no longer accurately captures the diver-
sity and specialization of the multitude of roles it comprises. In future
briefs, we will expand on the evolution of telemarketing roles that focus
on supporting marketing initiatives and building the database, and
teleprospecting roles that help drive lead qualification. Focusing solely on
quota-bearing inside sales for the time being, we continue to see the
role evolve in a number of ways, including:
• Segmentation. The growth and increasing confidence around
inside sales has now led to a more comprehensive segmentation
strategy, with strategic, named, and territory roles being developed
as they are in the field. With increased market segment opportuni-
ties and expanded account responsibilities, inside sales roles must
now become even more focused. Strategic inside sales accounts
require account management processes and skills to expand and
develop the revenue opportunities of larger, more complex
© Copyright SiriusDecisions. All Rights Protected and Reserved.
C A T E G O R Y: S A L E S S T R A T E G Y, I N S I D E S A L E S
accounts. Named account territories force sales reps to support and
manage multiple accounts and sell a more complete array of prod-
ucts/solutions. Business development reps hunt new accounts, but
no longer those in just the SMB space. Each of the roles need a sim-
ilar set of process, skills and knowledge as their field counterparts;
however, they demand a richer complement of sales automation
capabilities to compete.
• Specialization. Inside sales is taking on increasingly specialized
functions, such as being called upon to accept handoffs of less
profitable transactions or unproductive activities from the field.
Partner inside field roles have actually been in place for some time,
but SiriusDecisions now sees the development of more distinct
processes for this partnership that will replace what has largely
amounted to a “figure it out” relationship for account support and
growth. Inside product specialists sell only designated products into
the client base with no attribution to the field sales rep, while main-
tenance specialists have taken the renewal burden out of field sales’
hands, resulting in higher renewal rates and generating cross-sell
opportunities. In addition, we have observed that inside sales roles
are now becoming increasingly involved in the support and man-
agement of channel partners.
• Hybrid emergence. As inside sales reps take on larger and more
strategic accounts, a sort of “hybrid” role is being deployed. In this
role, reps will spend 90 percent of their time functioning as a tradi-
tional inside sales rep, but will travel selectively to specific strategic
accounts or for bigger opportunities. The hybrid role’s flexibility
enables the sales rep to deepen personal relationships (putting a
face with a name) and build face-to-face experience while holding
expenses to a minimum.
THE SIRIUS DECISION
The dawn of the new economic growth cycle will pose a challenge to
sales leaders to build an organization capable of achieving ambitious
growth targets without blowing up the expense line. Not only will this
require a strong focus on sales productivity across the organization, but
also an increased level of account and revenue responsibility placed on
inside sales. In many organizations, the ground has been laid for this
expansion to continue; in those that have been slow to move, there is
much work to be done.
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