Boiler-room sales tactics heat up b-to-b space

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Business development teams, long known as the boiler-room approach to generating leads and setting up sales calls in the door-to-door aluminum siding and vacuum cleaner business, are now making their way into the b-to-b space. Though they carry a stigma about them, such teams have proven throughout a wide range of industries to be a relatively inexpensive and effective way to start the sales process.

Most b-to-b sales divisions, until recently, would have thought it ludicrous, even inconceivable, for anyone other than their top sales representatives to call on high-end corporate clients. But now they’re starting to refine the business development team concept and suit it to their sales needs.

Companies are either creating internal or hiring outsource teams to use the Internet and other research tools to identify buyers on their prospect lists. Members of these teams make the initial call on behalf of a company, and schedule a follow-up appointment that will be carried out by a different member—a sales representative. From there, the sales rep is charged with making a follow-up call to confirm the details of an appointment, showing up on time and going over the basics before someone from the corporate sales staff takes over.

Today, such companies as Computer Sciences Corp. and Vanguard Solutions Group Inc. are among the numerous b-to-b organizations restructuring their sales operations to accommodate business development teams. Cost savings are a key factor prompting adoption, experts said.

"In this down market, we’re seeing energy being put behind reconfiguring sales forces," said Steve Waterhouse, principal at the sales training and consulting company Waterhouse Group, Scarborough, Maine. "Everyone is trying new ways to smoke out some good business."

Startling results

The results of b-to-b business development teams can be startling, said Scott Brown, VP-operations for LeadMasters Inc., Stamford, Conn. Brown’s company dedicates at least one person with 15 to 20 years of business experience to those who enlist LeadMaster’s outsourced services. That gray-hair savvy means clients can have confidence in the way they are represented.

"Telemarketers who call you at night during dinner are not the same people you’d want to call a CEO," Brown said. "But there is also an increasing amount of acceptance to the idea of outsourcing sales lead generation."

For one client, Computer Sciences, El Segundo, Calif., LeadMasters has generated more than 1,000 qualified leads in two years of work, Brown said.

Business development services may seem pricey. LeadMasters charges $85 an hour, or about $85,000 for one person designated to an account for six months. However, it’s often much cheaper than field sales.

According to the Gartner Group Inc., at an average of $87.50 per selling hour, a business development person costs about 35% of the $250 per selling hour that an average field sales representative costs. Business development staffs are capable of increasing revenues by as much as 150%, Gartner said.

The use of the Internet as a research tool is another change agent. Because business development people can scout the Web for prospects, they can be more effective than a field sales person working the phones, Waterhouse said.

"In the old days, sales departments would buy a mailing list and give it to the salespeople," said Waterhouse, who has worked with such companies as Lucent Technologies Inc., Aventis SA and Oplink Communications Inc. "Today, those same people are saying the salespeople are too expensive, and maybe that research can be done in-house."

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