There are two major subsets of sales personnel: inside sales reps, and outside sales reps.
But what’s the difference? To put it briefly: outside sales reps do most of their work outside a company’s workplace, travelling around actively to meet people in person.
In contrast, inside sales reps do most of their work remotely, using CRM software, email, VOIP, and other communications technology to connect with a higher number of people, while rarely meeting up with leads or customers in person.
So, I get what you’re thinking “Well, that’s it right? What’s the point of another 1000 words?” Bare with us here – there’s a lot more to it, I promise you.
Inside Sales: Working Remotely to Nurture Leads into Customers
A person’s position in a company fits under the “inside sales” umbrella if most of their work is done remotely, often right from their desk.
It’s not that inside salespeople never meet with anyone in person, but that isn’t their primary method of contacting and interacting with leads. Instead, they contact people via phone calls, email, and other forms of remote communication.
In some industries, the majority of a sales team consists of inside salespeople, and that’s where most leads and sales come from. This is especially true when it comes to many B2B products and B2B service companies, including software-as-a-service (SaaS) and other tech. You also find a focus on inside sales among companies that sell high ticket B2C items.
As you can probably imagine, modern technology has made inside sales more effective and more important than ever before.
Inside sales is considered to be a distinct entity from telemarketing per se.
Telemarketing dates back all the way to the 1950s. It’s defined by cold calls that are almost always heavily scripted, usually in the interest of selling low ticket B2C items like extended warranties on a product. It’s also a volume game, with semi-skilled workers in call centers making high number of individual calls, the majority of which don’t end in a sale.
Inside sales is more targeted, generally involves B2B products or services, and relies more strongly on the salesmanship skills of the company’s sales personnel. While inside sales representatives will generally have a set of talking points, or even a brief script for the initial contact with the person, there’s a lot more improvisation and natural conversation involved.
While telemarketers are generally people in relatively low-paying, high-turnover positions that are often willing to hire people without any sales experience, true inside sales reps are skilled professionals.
As such, their base salaries are quite a bit higher than that of a typical call center telemarketer, and they often earn commissions as well. While “telemarketer” is a job you do while you’re in college for some extra cash, “inside sales representative” is a rewarding and lucrative long-term career path.
Today, the majority of salespeople in most B2B settings are inside sales reps, and they tend to outnumber a company’s outside sales reps.
One of the reasons inside sales has grown so much, now that technology has allowed that to happen, is that it’s quite a bit more cost-effective than outside sales.
The average in-person outside sales appointment can cost up to six times more than a call done remotely by an inside sales rep.
Despite the lower cost, inside sales have the potential to be more complex than a typical outside sale, and involve a higher number of decision makers. Inside sales reps are often heavily dependent on CRM software, and collaborate more closely with the marketing department.
Outside Sales: Doing It the Old Fashion Way
Outside sales representatives go out and physically meet with leads in person. They usually work on a relatively flexible schedule and do a good deal of travelling.
In the past, outside sales was more prevalent than it is today. New technologies like customer relationship management software, Internet-based voice calling, and email have made it a lot easier for salespeople to nurture leads and make sales without ever leaving their desk.
However, companies do still hire outside sales teams. There tend to be fewer outside than inside sales reps, as the logistics often involved with outside sales — transportation, travel, things like having dinner with leads and otherwise networking with people — can get pretty expensive in comparison.
Inside vs Outside Sales: Key Differences to Know
Inside sales and outside sales are distinguished from one another in America by the US Department of Labor, primarily based on how much time is spent face to face with leads and customers, versus making calls or sending emails from a desk.
For the most part, someone is an outside sales rep if their work takes place primarily away from their employer’s place of business. They’re out of the office more often than in it, out pounding the pavement, knocking on doors, having lunch with potential clients, and otherwise interacting with people face to face.
An inside sales rep spends most of their time in the office.
Decades ago, nearly all salespeople would have been classified as outside sales reps. But today, it’s the opposite, and most people are either inside salespeople or occupy a hybrid role with elements of both.
Here are some of the biggest differences, from a practical and operational standpoint.
● Different tools are used for closing inside sales versus outside sales. With inside sales, it’s all about the CRM. Customer relationship management software is one of the biggest recent innovations in sales and is a big part of why inside sales is currently so important and so prevalent, especially for B2B companies. Inside sales personnel use a CRM’s to keep track of leads and sales, often coordinating closely with the company’s marketing department to engineer a seamless, highly efficient sales funnel. While outside salespeople also use CRM software, they usually aren’t as heavily reliant on it, and a lot of what they do is less heavily planned and more spontaneous.
● Different sales cycles. It varies, but in the majority of cases, products and services sold primarily via inside salespeople tend to have a shorter sales cycle. Outside sales is a longer, more involved process, with a lot more interpersonal interaction and genuine relationship-building involved. As you can imagine, this works best with high-ticket items, where despite the length of the sales cycle, each individual sale is highly lucrative, offsetting the costs associated with outside sales personnel and their day to day processes.
● Inside and outside sales scale differently. An individual inside sales rep can interact with a much higher number of people on a regular basis than an outside sales rep. While outside salespeople can only really pitch one person at a time, an inside sales rep can be in communication with several people at once via email.
● Different skill sets. Obviously, communication skills are essential for any form of sales. But while in-person charisma is the biggest factor for outside sales, an inside salesperson’s best asset is often their skill with written communication.
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