Sales prospecting is the first step in the sales process. It’s when you identify potential customers and contact them.
While the internet has made it easier to reach buyers, 54% of salespeople believe it’s much harder to get in front of prospects than 5 years ago.
Why?
Sales Strategist Jeff Beals gives 4 reasons:
- prospects are busier than ever
- salespeople act the same and say the same things
- people now consider products and services as mere commodities
- prospects are very informed, but it’s not always the right information
To rise above these challenges, salespeople must focus on what the prospect needs – not the product’s benefits and features or the company.
So when researching and communicating with a prospect, you should ask questions that show you what they value, then explain how your product/service will deliver this value.
Ready to learn the ins and out of sales prospecting in this 10-minute read?
We’ll touch on the definition of sales prospecting, examples, and the sales process below.
Let’s dive in!
What is Prospecting?
Prospecting is gathering information to identify potential customers for your products or services. Your primary goal is to identify people who would value your product. Then, add them to your sales funnel, nurture them until you close a deal, and make them loyal customers.
Prospecting is about bringing your product to the prospect’s radar and showing them its value in their life. If you attract qualified leads, prospecting will smoothen other sales process operations.
Unfortunately, over 70% of 400 salespeople find that over half of their prospects aren’t qualified leads.
The first step to targeting qualified leads is describing your ideal client (more on this process below).
What Does Prospecting Mean in Sales?
Sales prospecting is when you first identify potential customers for your products, known as sales prospects. It entails creating a list of your intended potential buyers and later communicating with them to push them down the sales funnel.
The primary goal of initiating a conversation is to inform them of your product’s value, get them into the sales pipeline and convert them to paying customers.
What is an Example of Prospecting?
An example of sales prospecting is cold emailing. It’s 40 times more effective than social media and accepted by 80% of buyers.
Jake Jorgovan, a creative strategist, generated $12,030 through cold emailing. His sales process was:
- Creating a relevant case study with a raving testimonial (Jake’s sales prospecting tip)
- Choosing his target audience (relevant to the case study)
- Finding find the sales prospects’ websites and phone numbers on sales directories and trade organizations
- Researching the prospects and getting their emails on their websites
- Writing and sending out hyper-personalized cold emails
- Following up 7 to 10 days later
Below is an example of a cold email script that earned him $4250.
You can find more email scripts and a detailed email outreach process here.
Ambition.com, a company that helps business owners increase employee productivity through their software, ran a 6-week cold emailing campaign that generated 73 leads.
After sending out the first 578 cold emails, they only got 6 responses. But after following up the leads (some six or more times), they got 67 more leads.
According to Ambition, smart value messaging and persistence are the keys to successful sales prospecting.
What are the Types of Prospecting?
Besides email, prospects prefer interacting with sales reps at industry events, on LinkedIn, voice mail, and social media. In addition, referrals and text are effective sales prospecting methods.
Let’s dive deeper into the three main strategies.
1. Cold emailing
One sales quiz found that 8 in 10 prospects prefer communicating with a sales rep via email. So it’s no wonder that 78% of sales reps also prefer email communication.
Cold emailing is sending an email to a prospect who doesn’t know you or expect you. That’s what Justin McGill’s team did to grow his product’s revenue (a B2B lead generation tool) to $30k per month in 12 months. They used the tool, Lead Fuze, to search for prospects on Google. And other tools like Hunter to find emails.
Justin says the key to prospecting emails is to keep them short. Three to four sentences long. He has a formula for the email: QVC.
- Start with a Question pertaining to your business.
- Then share your Value proposition – what makes your business unique?
- End with a Closing CTA that begs for an answer.
The image below’s a sample of their email script.
2. Networking and Referrals
Referrals come from past buyers, existing customers, friends, or colleagues who know your business. They convert faster and have a higher lifetime value. A b2b research found that having a formal referral program makes a business 3x more likely to achieve its revenue target.
Remember Paypal’s referral program that grew their customer base from 1 million to 5 million in about half a year? Paypal rewarded both the referrer and referred – a strategy that other successful programs like Uber and DropBox borrowed.
Like referrals, networking is an effective sales prospecting method. That’s why eighty-three percent of exhibitors attend trade shows to meet potential customers. And after exhibitions, most exhibitors follow up on their prospects via email and phone.
However, a recent study found that 70% of business owners network online. And LinkedIn is their most preferred networking platform.
3. Social Media
Researchers found that social media leads take the shortest time to close (about 40 days). Plus social platforms like Facebook, Twitter, Instagram, LinkedIn, and others have over 4 billion users, and some are potential buyers.
For example, Susan Hanshaw prospected on Twitter to drive potential customers to a single retail location. Her team used Twitter Search for prospecting and then reached out to them through Twitter’s @ mentions feature.
This prospecting strategy is also known as social selling.
From the campaign, they received a 32% total conversion rate, 10% being new visitors (tracked with a CRM).
Below is the chart showing their results. 84% of their visitors responded to the tweets, and 26% of the non-visitors contacted them.
What is the Difference Between Marketing and Prospecting?
The difference between marketing and prospecting is that sales prospecting is laser targeted. There’s often an established sales process; in most cases, you need to prospect before marketing.
Sales prospecting is studying and identifying someone willing and capable of paying for a product. Then sales reps will reach out to them online, via call, text, or even face-to-face meetings.
It involves a detailed sales pipeline, and each stage of that pipeline requires specific attention and care.
On the other hand, marketing is creating awareness about your product or service to a target group. For example, you may run outreach marketing campaigns, or content marketing on platforms like LinkedIn.
With that said, you must conduct sales prospecting first to identify potential buyers. Later, you will proceed with the marketing.
Customer Vs. Prospect
A customer is someone you’ve sold products or services to.
In contrast, a prospect is someone you’ve identified as a potential buyer but haven’t done any business with. A customer begins by becoming a prospect first and then later transitioning to a paying customer.
Below is a graphic process of how leads bring about a prospect and later a customer.
You might have to treat some customers like prospects. Customers love asking questions and getting business advice from their vendors. As such, you must explain every detail as you did while prospecting.
Importance/Benefits of Prospecting
- Increase in sales – effective sales prospecting accelerates sales opportunities. The new sales opportunities accelerate business growth.
- An increase in revenue – helps business owners expand their sales teams, improve their products, and fund marketing campaigns.
- A deeper understanding of your customers – when you reach more prospects, you learn your customers’ different behaviors and needs for branding and product development.
- Lower costs – prospecting by cold emails and cold calls is cheaper than traditional advertisements.
- Customization – you can easily customize marketing materials for each direct email you send to prospects. Customization helps your business stand out from the regular emails that prospects receive daily.
How to Prospect (Sales Prospecting Process)
Sales prospecting is a different process for each business. The main elements are describing your ideal client, researching their business, prioritizing the prospects, and contacting them. Below’s the sales prospecting process.
Step 1: Create your Ideal Customer Profile and Personas
Describing your ideal customer allows you to target only qualified leads. With different types of clients, you need different buyer personas.
Here are some questions to define your client: (you can answer these questions by profiling your current customers or market research)
- What’s their industry?
- Location? – if you serve specific areas
- What’s the ideal company size and revenue?
- Job title?
- Their pain points?
- What do they value?
- What problem will your business solve for them?
- Why would they choose you and not your competitors?
Step 2: Create your prospects’ list
You can build your prospect list manually or outsource it to a virtual assistant or lead generation company. When doing it manually, most sales rep and companies use lead generation tools (like the previously mentioned LeadFuze).
The process for creating a prospect list:
- Find companies that match your Ideal Customer Profile (ICP). Look through Crunchbase, LinkedIn Sales Navigator, and ZoomInfo to view companies and their profile information.
For SaaS businesses, you can look at your competitors’ reviewers on sites like G2, Capterra, and GetApp. G2 allows you to filter the reviews according to industry, company size, user role, and region.
Then look through their websites. As you research companies, gather points that you’ll use to personalize your outreach message.
- Identify the key decision-makers. LinkedIn shows you the employees in a company and their roles. You can also view the About Us page on the company website or google them directly (e.g., Lead Fuze marketing head)
- Find and verify their email addresses using outreach tools. Sign up for and install the Hunter chrome extension in your browser to view emails as you browse the company websites.
If your prospect is not active on LinkedIn, use the ContactOut chrome extension to find and validate their email while on LinkedIn.
Finally, prioritize prospects who are most likely to buy. Prioritizing will save your sales professionals’ time, considering that they’ll personalize each message.
Step 3: Reach Out and Schedule a Meeting
Reach out to each prospect with a personalized pitch.
Ideally, prepare each outreach email with brief information showing your product’s value to the prospect’s organization. I recommend Justin McGill’s QVC formula to keep the email short and relevant. It’s a three-sentence email starting with a question about your business, then the value proposition and closing CTA.
You can also use AI copywriting tools that use frameworks like AIDA to help with email conversions.
As for personalization, gather information about prospects from:
- the company’s about us or contact us pages or overall website
- the prospects’ latest blogs
- their latest posts on social media channels
After learning all the necessary information, send the pitch. I recommend scheduling the first email and follow-up emails in an automation tool like Respona.
You might also like my list of email management software recommendations here.
Keep these tips in your mind when pitching;
- Reference a specific problem they are facing in their business. Consider adding a case study solving a similar problem.
- Be human and add details wishing them well in their company’s growth. These small details create strong connections.
- Focus on providing value first but not selling.
Step 4: Revisit your prospecting process and improve
Always review the sales prospecting process to note which activities add value. After contacting the potential customers, get back and review;
- How you crafted the messages
- How you help the prospects understand the value of your product
- How you pointed out their challenges.
- How you closed the deal
Note that this is a self-reflection that helps you improve on your prospecting work in the future.
How to Measure Sales Prospecting Success
You need to set performance indicators in sales prospecting. Here are my three prospecting metrics that give me the best results:
- Activity metrics – check daily or weekly phone dials, the number of emails you send daily, the response rate, and the time you spend on cold calls.
- Results-based metrics – check the number of sales-qualified leads and the number of booked meetings.
Sales Prospecting Techniques
Here are effective sales prospecting techniques:
1. Establish your potential buyer profile
Learn your active buyers’ characteristics and use the information to establish your perfect prospects. When researching their profiles, think of a company that would value your products or services.
2. Automate Prospect Discovery Process
Fortunately, Crunchbase has one of the most effective engines and database that automate potential buyer discovery. The process is less time-consuming and gives potential leads. Below is a screenshot of the platform.
3. Create a prospect ranking technique (Use website cookies data)
Have a sales prospect ranking system to ensure you don’t invest your time on people who will never turn into buyers.
For instance, use site cookies to monitor every prospect’s actions, like visiting the site and clicking specific buttons.
Once they get to a certain threshold, you can take action by obtaining their email and contacting them to initiate the sales cycle.
Sales Prospecting Tools
Sales prospecting tools are platforms that help sales reps or sales teams easily identify qualified leads.
Below are examples of quality prospecting tools:
1. ZoomInfo (for tracking contacts)
ZoomInfo is a B2B database of potential customer’s contacts. It uses AI technology to suggest similar contacts. Additionally, it detects new companies’ projects that can benefit from your products and services.
2. LinkedIn Sales Navigator (for discovering leads)
LinkedIn Sales Navigator allows you to find leads with advanced search options. After finding the leads, the tool suggests similar potential accounts. It also gives regular updates about potential clients.
3. Reply (For prospects’ emails discovery)
Reply has prospect discovery and email automation features that ease sales development representatives’ work. It’s a simple chrome extension that allows you to add potential leads to a reply account. Afterward, you can design an outreach sequence to reach the prospects.
Final Thoughts
Whether you have seasoned or new sales reps, an effective prospecting strategy is the foundation of sales.
Start by describing your ideal client. Then research your prospects based on the value your products can add to their business. Prioritize and rank them from the high, medium, and lower likelihood of becoming your customers.
Then send personalized pitches to each prospect showing how your business will add value to their business. Finally, revisit your prospecting processes and refine them.
Good Luck!
Jessica La
