Inside Sales vs. Outside Sales: Which Is Best for You?

One of the biggest decisions a company can make when setting up their sales team is whether to focus primarily on inside or outside sales. In this pandemic, all of our inside outside sales representatives are working remotely and as we look forward into more normal times it’s hard to say which model will companies default back too.

It seems that these two approaches are at odds with one another. One is focused on high-cost clients and the other seeks to generate a lot of sales quickly.

Though it may seem that commission and base pay are two sides of the same coin, they?re both equally important. Without a strong salesperson who is not motivated by commissions or bonuses, you can’t have a successful business.

Now, we?ll talk about the most important things to consider when hiring salespeople for your team.

  • What is inside sales?
  • What is outside sales
  • What is inside sales vs outside sales?
  • What is the best way to staff your sales team?
  • What is the difference between inside sales vs outside sales, and how can that help you?
  • How can an inside salesperson and outside sales person work together?
  • Hiring guide
  • It’s not enough to just hire salespeople who are qualified for the job. It is also important that they have skills, like persuasive communication and emotional intelligence.
  • One of the most important skills for outside sales is excellent communication. Salespeople need to be able to communicate effectively in person, over email and on the phone.
  • Compensation
  • Who is the best person for this position?

Need Help Automating Your Sales Prospecting Process?

LeadFuze gives you all the data you need to find ideal leads, including full contact information.

Go through a variety of filters to zero in on the leads you want to reach. This is crazy specific, but you could find all the people that match the following: 

  • A company in the Financial Services or Banking industry
  • Who have more than 10 employees
  • That spend money on Adwords
  • Who use Hubspot
  • Who currently have job openings for marketing help
  • With the role of HR Manager
  • That has only been in this role for less than 1 year
Just to give you an idea. 😀

What Is Inside Sales?

Inside sales is remote sales because it’s done entirely in the office, from a desk. Instead of face-to-face selling that can be difficult to arrange at times, inside sales uses all the communication tools available.

  • Phone
  • Email
  • VOIP
  • CRM platforms
  • And much more

Inside sales is a common method of selling in the B2B world, especially for SaaS and tech companies.

Inside sales is not just telemarketing. The misconception that it’s the same thing as cold calling has finally started to fade.

The difference between telemarketing and inside sales is that in the former, scripts are used to make cold calls. Anyone can do it because there?s no need for a skilled salesperson; all you need is someone who has memorized their script. In contrast, inside sales requires more than just skill: they may be done over phone or Skype instead of face-to-face meetings.

The “inside sales” approach is to do the selling remotely, with a CRM and outbound tools.

A salesperson needs to be motivated by more than just a paycheck. I learned this lesson the hard way, and so should you.

Outside Sales Definition

Outside sales is the sale of products and services through in-person, face to face interactions. It’s not a common form of selling because these reps don’t work out of office buildings but rather meet with prospects outside.

The difference between inside sales vs outside sales representative are the following:

It’s not uncommon for outside salespeople to have a lot of responsibility and work autonomously, as well as having strong emotional intelligence.

While inside sales reps deal with smaller accounts and less expensive products, outside sales reps are typically seen as their company?s superstars because they work on larger deals.

With today’s sales enablement tools, such as Skype and Zoom, a large portion of the job can be done from the office. Outside Sales positions still need to go out into the field though because they offer flexibility and willingness that cannot always be replicated in an office.

Entrepreneurs are used to being their own boss and working on the things they want. But entrepreneurship is not for everyone, so it’s important that entrepreneurs also understand how people in traditional companies work.

What Are the Responsibilities of Inside and Outside Sales Representatives?

Inside sales reps work from home or in an office and spend their days communicating with potential customers over the phone, through email, on social media sites like Facebook. They make a lot more calls than outside sales representatives do because they can’t travel to meet them.

Inside sales reps have a much more structured day, with numbers to hit for dials made and meetings booked. They are not as susceptible to unpredictable work or bad leads.

Outside sales reps now spend about half their time outside of the office. They still have to sell remotely, but 88% more than before 2020 pandemic.

Should You Utilize Inside Or Outside Sales?

Traditionally, companies have focused on outside sales and marketing. However, the industry is shifting. It is now inside sales vs outside sales. 

Inside sales is growing at a rate that outpaces outside sales by 15x.

Companies are now trending toward a 5050 split between inside and outside sales. Data from 2019 showed that it would take about four years before the majority of companies had switched to this model, but 2020 data suggests we’ll see more progress in these trends.

More and more companies are realizing that they need to adopt a 5050 team. This is largely due to the internet making it easier for people to buy things without being sold in person.

SBMI, one of their clients surveyed them and found that only 27.9% preferred to buy face-to-face

Although the trend is for more and more people to buy things online, face-to-face sales are still important. People feel better about spending large amounts of money or making big purchases in person.

You will need to decide how much of your sales you want from inside and outside, as this is what the mix that best suits your company.

The Product

You need to know what you?re selling and how much of it before figuring out the best sales mix.

The best way to think about this is if you would be likely to buy the product on impulse, or it’s more of a purchase that requires careful consideration.

Facebook ads are most successful when they promote things that people want to buy.

  • Small products
  • Products with a small ACV
  • Products that can be used to solve a basic, everyday problem are the best.
  • A one-time purchase
  • When I first began hiring salespeople, I just assumed pay along with commissions and bonuses would be enough motivation. However, a paycheck is not the only thing that matters.

With the lower price and commitment, you will be able to convince your customers with a higher velocity of sales.

However, people prefer to buy larger items in person rather than online.

In most cases, you don?t want to buy an enterprise CRM online. You usually need a chance to try it out in person and have the product customized for your company before committing.

If you trust the salesperson, they will probably recommend a product to purchase. If not, it is unlikely that they would offer any advice on what to buy.

The company has made an investment in a new sales strategy and it’s paying off.

These are going to be:

  • Large and expensive products
  • Products with a large ACV
  • When you are trying to solve a more complicated problem, or offer many potential benefits for your customers, it is important that the customer understands why they need this product.
  • Products that will involve an ongoing commitment, payment, or could affect the future in a large way

Products that have a high CAC typically take more time to sell, and require the customer be convinced in person. The buyers will appreciate your personal touch and feel comfortable purchasing from you.

However, this is changing.

People are more open to making big purchases online. Just a few years ago, buying a car on eBay would have been unthinkable. Now it happens fairly often.

That’s why, no matter what product you’re selling, it is important to have a diverse team of people who can do both inside and outside sales.

The Organization

The type of company you have will determine the ratio between inside sales vs outside sales. This is true for products as well, so it’s important to know what your strengths are.

If you are in the market for an inside sales position, then these three things will matter to your success: 1. A low cost of entry (especially when it comes to technology) 2 2. An easy-to-use CRM system with seamless integrations and reporting tools that can be used on any device3 3. Enough revenue potential per call

  • Primarily digital
  • I first thought that if I could just get my salespeople to sell more, everything would be fine.
  • I was focusing on the number of new prospects and not paying attention to whether or not they were qualified.

If you are looking for a good match, outside sales may be right up your alley. This position will require someone who is comfortable working in an environment where they need to develop their own clients and maintain relationships with them.

  • I first started out with a company that sold physical products or complex technology.
  • I wanted to target a more elite market with my new hires.
  • The best way to motivate your salespeople is by building long-term relationships with them.

The Strategy

To effectively match your sales strategy to the strengths of your team, you must first identify which strategies are best for each individual. If this is not done correctly then it will be difficult to succeed.

If you’re thinking about setting up an inside sales team, consider these factors:

  • More transactional
  • We use digital funnels to automate tasks.

If you are looking for a salesperson who will be doing field work, then an outside sale is the right fit.

  • Is largely relational
  • Requires high-touch interactions with demos, meetings and other activities

How Are They Distinct, and How Does This Benefit You?

In today?s world, the lines between inside and outside sales are blurred. They have a lot of overlap but still differ in some ways.

Office jobs and sales can look very different on the surface, but their actual work processes are almost identical.

So what is the difference between these two? Why does it matter?

Sales Cycle

One key difference between the two is that it takes much longer to close a deal with enterprise clients than an SMB client.

With inside sales, the process of going through a sale is much quicker. It follows all the same steps as outside sales but moves more quickly.

inside sales vs outside sales

Inside sales deals with the needs of small and medium-sized businesses, while outside sales deals with larger corporations. The products are usually less expensive and not as complicated to sell.

I?ve had to learn that it’s not worth investing in acquiring customers who are difficult to sell because the profit margin is already slim.

So, with inside salespeople the focus is on volume. They don’t need to sell as many products per customer and so they can go after more customers.

Outside sales usually tackles large customers where the ACV is higher. These decisions take a lot of time to make, so there’s no point in trying to close them quickly.

The more personal touch you can provide, the better your chance of getting a sale. This is because people are less likely to buy something if they do not trust or know about it.

As a result of the costs for outside sales, CAC is much higher than inside sales. This leads to focusing on high-quality and highly valuable accounts.

An inside salesperson can have a single phone call with any number of potential clients, whereas an outside salesman may take weeks or months to close just one sale.

Close Rate

Another difference is that outside salespeople, on average, have a much higher close rate than inside salespersons.

Outside sales reps do not typically have a higher success rate because they are better at their jobs. Rather, it is due to the different strategies that these two groups employ. One group focuses on quantity and cost-cutting measures while the other seeks for high margins.

One inside sales call has a cost of $50, while outside sales have an average cost of $308. That means that it?s not very expensive to lose one customer in the process because they are cheaper to acquire than customers from other channels.

When you lose a customer, it takes less than two days to find another. You will likely make more sales in the time that would have been spent on one difficult sale.

When you hire an outside salesperson, they are constantly on the road and making cold calls. This means that there is a much higher chance of them losing potential customers to competitors or never hearing back from prospective clients.

When a client has high account value and they have a higher cost-to-acquisition than others, it is more economical to work with them for as long as necessary in order to close the deal.

The best SaaS sales teams are today realizing that base pay and commissions is not enough motivation.

How Can Inside And Outside Sales Collaborate?

Strategic opportunities are an important part of the inside or outside sales process, and both inside and outside jobs can be used to take advantage.

  • Inside sales deals with the more transactional accounts, which is primarily small to mid-sized businesses.
  • This frees up the outside sales reps to spend more time and money on big accounts, which has a higher average customer value (ACV).

The two branches can also work together to make the other branch?s job easier. They do this by supporting each other tactically.

Mark Kosoglow, a professor at New York University’s Stern School of Business and an expert on human motivation for this article

The best thing about being on an inside sales team is that the people you work with are just as motivated and knowledgeable as you. When someone has a great call, they’re more than happy to share their tips right there in your office.

To be better prepared for a call, try having an open conversation with the person before they join. This will give you insight into their needs and desires.

With the help of ideas reps, the best ones can be distributed to other salespeople.

It’s also important to remember that customer interaction preferences are constantly changing.

Customers may prefer the in-person sales pitch at first, but then they will come to trust your company and want to buy remotely.

Different people communicate in different ways, and this may change throughout the sales process.

In order to create a successful sales team, you need both inside and outside representatives. They will be able to provide the customer with what they want most effectively by collaborating.

Inside Sales Skills and Qualifications

One of the biggest difficulties with inside sales is that, unlike in outside sales where you can show a product and provide demonstrations for potential customers, it’s difficult to describe what your company does without visuals. This means that people have to rely on email or phone conversations – which are easier than they used to be thanks to video conferencing and other tools.

One way to counteract this is for the salesperson to be exceptional at research and communication. A good inside salesman needs excellent skills in breaking down complicated subjects into something that can easily understood, and they need a talent for painting a picture with words.

Salespeople are not just talking to people on the phone, they need to be able point out all of their work and accomplishments in a written document.

Building relationships with inside sales is difficult because they often require less time than outside, but it can be done.

This means that in order to get around this, you need to be able to use social listening and a friendly demeanor.

The success of an inside salesperson is often a numbers game. They need to be able to handle hearing ?no? frequently and maintain their energy as they move onto the next sale.

In inside sales, the convenience of the customer is important. Being able to work flexible hours and using different methods can be a big plus.

It is also important to develop other skills like technical sales, negotiating techniques and public speaking.

  • Appointment setting
  • Email templates and tracking
  • Predictive analytics

And I have learned that many other skills, such as those for building a strong business development strategy are also important.

  • Contact sourcing
  • Coaching and training
  • Content engagement

Experience and Education

Most inside sales jobs do not require any special education and only need a high school diploma.

A good entry-level sales position is inside sales, but they need to have the skills for it.

Interview Questions

  • What do you think of X product?
  • How do you keep up with your target market?
  • One way to find out what your customer needs is by asking them. You can do this in person, on the phone or through email
  • How should you respond when a customer complains about your product?
  • How do you go about generating your own leads?
  • Do you want to work in a field where it’s expected that your sales will happen quickly?
  • What steps do you take to research your product?
  • Let’s walk through the steps of my sales process.

Outside Sales Skills and Qualifications

If you are a salesperson who deals with executives, it is important to know how your product can benefit them. You also need confidence and creativity.

A big part of a salesperson’s job is to have good social skills and be comfortable speaking with people. It helps if they are outgoing as well.

I was doing everything I could to make salespeople happy and focused on their success. This included giving them a competitive salary, commission plan that rewarded higher performance, bonuses for achieving certain goals or milestones.

I’ve found that my salespeople need to be self-starters who can work independently. They often have an unpredictable schedule, so they must be able to set their own hours and travel on short notice.

When it comes to outside sales, a loss is much more expensive. So your field reps need to be proactive problem solvers who can find solutions and make the sale.

Salespeople need to be able to work in a flexible environment, travel at any time and show up when the customer needs them. The high cost of acquiring customers means that they have to maximize every opportunity.

To make sure that they are skilled, I try to hire people who have:

  • Customer relations
  • New business development
  • Account management
  • Account sales

Experience and Education

Outside sales representatives usually require a little more experience and education than inside reps. It is very helpful to have some sort of degree in marketing, business, economics or communications.

A salesperson with any previous experience in customer service, retail, or a similar role will be able to adapt more quickly and easily than someone without this type of background.

Interview questions

  • How do you stay on top of the latest developments in your industry?
  • How much time are you willing to spend on the road?
  • When you are marketing your product, how do you show its value?
  • Can you tell me about a time when your negotiation skills helped to win over an unhappy client?
  • What is the average length of time it takes for a sale to be made?
  • Salespeople tend to lose deals for one of the following reasons: -The prospect has already made a decision and does not want any more information. -A high price is too much or something doesn’t seem right about it. -Their productservice just isn’t what the person wants at that time.
  • What are some ways that you make connections with prospects?
  • What is the role of social media in your sales process?
  • How do you qualify prospects?
  • What is your negotiation style?
  • What strategies do you use to work with your team?
  • What are your time management strategies?
  • I know that meetings are one of the most important parts of my job, so I make sure to always do some research beforehand.

Compensation

Now, what do you pay them?

I used to think that the average salary for an outside salesperson was around 50k, but now I know that much of their income comes from commissions and bonuses. The highest earners make as much as 80k.

Sales people in the inside sales position generally make less than $40,000 a year on average ? but this amount varies by location and industry.

Salespeople often make less from commissions and bonuses.

In order to get the best out of your sales team, you need a plan that addresses compensation and motivation. This article offers some good examples for how to develop such plans.

As more companies are seeing the value of inside sales, they’re starting to offer higher salaries and bonuses.

Who Is the Best Fit for the Job?

There are many similarities and difference between inside sales vs outside sales representative. All of them have the same goal, which is to sell goods or services.

It is important to use every tool in your sales arsenal, because it will help you convert more potential customers. You need to have an inside and outside approach when selling.

Hiring for both inside and outside sales should not be a binary switch. You need to find the perfect blend of what your company needs.

So, which is better?

Whichever one makes the sale.


Need Help Automating Your Sales Prospecting Process?

LeadFuze gives you all the data you need to find ideal leads, including full contact information.

Go through a variety of filters to zero in on the leads you want to reach. This is crazy specific, but you could find all the people that match the following: 

  • A company in the Financial Services or Banking industry
  • Who have more than 10 employees
  • That spend money on Adwords
  • Who use Hubspot
  • Who currently have job openings for marketing help
  • With the role of HR Manager
  • That has only been in this role for less than 1 year
Just to give you an idea. 😀
Editors Note:

Want to help contribute to future articles? Have data-backed and tactical advice to share? I’d love to hear from you!

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Justin McGill
About Author: Justin McGill
This post was written by Content at Scale, a solution that uses AI + a team of optimization specialists to publish hundreds of high quality, SEO optimized content straight to your blog. It’s the first and only solution that allows you to truly scale content marketing.