Building pipeline with SDR’s
I read Trish Bertuzzi’s book ‘The Sales Development Playbook’ and it was by far one of the best sales books I’ve read in a while. The book focuses heavily on building pipeline with SDR teams. This is the second post of a few I’m going to share about this book: there was so much good information that putting it all in one post would be too long. Below are some of the excerpts I found to be very insightful.
Reps are giving up too quickly. Studies have found that it takes between six and ten attempts (including at least four by phone calls) to properly prospect a given contact. The absolute bare minimum number of attempts to contact at least 50 percent of your lead is 6. The average rep’s performance? Between 1.7 and 2.1 attempts before they give up.
Use different methods. In addition to executing a multi-touch cadence, reps need to vary the media they use. This should include the following:
3. Other (ghosting*, texting, social media)
*ghosting is calling a prospect, hoping to catch the live, and not leaving a voicemail.
Voicemail and email are equally important. Voicemail and email together are twice as impactful as all the rest combined. To create pipeline, your reps need to use the phone. An over-reliance on email leaves them with pen pals — not prospects.
Cadence. Kyle Porter, CEO of SalesLoft, certainly knows about cadence. In fact, his company built a product that help sales development teams execute prospecting. Kyle shared SalesLoft’s 7x7 cadence which includes seven attempts for each new prospect over a span of seven days. The pattern follows:
Day 1- Reps send a personalized email in the morning. Later that day, they’ll reach out via phone and either connect with the prospect or leave a voicemail.
Day 2- It’s a phone call with no voicemail.
Day 3- Another call with voicemail in the morning and then one more call in the afternoon without voice mail. So in the first 3 days, we’ve got 1 email, 2 voicemails, and 2 no-voicemails.
Day 4- It’s another email.
Day 7- Reps sends a final email and try to be original and human. Sales Loft has found humor to be very effective in this touch.
SalesLoft has found that for their market seven touches in seven days works best. For many of my clients it is nine touches in fifteen days. Don’t get hung up on the numbers, you will find your unique formula with trial and error.
Show familiarity. If you want prospects to listen, your reps have to first show that they’re interested in them. One way to do this is to demonstrate relevancy. For example, your reps could reference something happening in their industry, with their role, at their company, or that they shared in an interview or on Twitter. Prospects don’t care that your reps made two other attempts. “Haven’t heard back from you after my last call” and “Following up on my recent email” aren’t good enough reasons to call again. Each message should build on the previous and offer something new. Referencing previous attempts wastes precious airtime and often comes off as hostile.
Don’t be deceiving. Never let reps leave deceiving messages. Too often, I’ll catch reps leaving vague message like “Dana, Pat Smith here. Just have a quick question for you — 555.432.1212” or being flat-out dishonest and saying they were referred by the CEO when they weren’t. It may work: reps may get more callbacks. But you’re setting a precedent that will have future implications.
Time is limited. It is my personal belief that reps shouldn’t take up the beginning of their voicemails saying their name and company name. It wastes valuable real estate, and it makes them sound like everyone else.
Quota. Since 2007, the average percentage of reps at/above quota (in my research) has bounced between 63 percent and 74 percent. You should also make use of ramped quotas for new reps.
No Contact. An account shouldn’t be marked “no contact” until at least two prospects have said no (or not responded).
The handoff. Prior to the discovery call, your SDRs need to hand off the lead/opportunity to the account executive. Effective handoff requires calendaring a meeting, introducing all parties, communicating next steps, and setting an agenda for the discovery call. I am a firm believer in the SDR participating in the discovery call. There is no better training experience than live listening. The reps are able to hear how their account executive counterparts move. You might object that this takes them off the phone. Yes, it does. Get over it. You should be thrilled that another member of your organization is assisting in developing the skills of your reps.
Next steps. Closing out a discovery call without a confirmed next step is just a waste, so have a process in place to make sure it does not happen and trach those outcomes.
Metrics. The Activity metrics you’ll want to measure include the following: Total activities per day, Inbound lead response time, Attempts per lead, # of prospects per account.
These are the metrics that leaders can manage and reps can control. Telling reps, “Hit your number; I don’t care how you get there,” is great bravado and terrible management. Informing your reps that x activities will lead to y outcomes and drive z results is real leadership. The Objective metrics you’ll want to measure include the following: # of connects/connect rate, $ of quality conversations/rate, Email response rate, “Bad data” rate.
The best metric. I believe that number of quality conversations is one of the most important indicators of rep proficiency. Does a given rep have the ability to arouse curiosity and launch a conversation with a prospect? Or is the rep being shut down and kicked to the curb form the get-go?
Measuring emails. You can also use email response rates as a proxy for messaging effectiveness. I prefer to use reply rates (there are several technologies that can supply this). Email open rates are less valuable (and notoriously unreliable).
No shows. If you are setting introductory meetings, the cruel truth is that no-shows are a reality. A no-show rate of 15 percent to 20 percent is normal. Any more than that and you should evaluate whether your reps are sparking curiosity or badgering prospects to accept meetings they don’t ever plan on attending.
You can’t just ask your employees for referrals to potential new-hires. “Unless a friend or former colleague figuratively falls into their laps, the referral program rarely gets a second thought. Hubspot’s Mark Roberge, who earlier discussed how he made hiring his number one priority, shared the following approach with me. “I call this the referral. When a new rep has been in the role for three or six months, I tell them that tomorrow we are going to sit together for twenty minutes. And that tonight, I’m going to go through all their LinkedIn connections and find people that are early on their careers at good companies. I’ll build a list that we’re going to go through together.”
Gotta use Glassdoor. “Far too many companies haven’t even claimed their Glassdoor profiles. Their company pages are stock and bleak, and they present only the bare minimum of information. To stand out from the crowd, spice it up. Add pictures, videos, awards, information about your culture, your philanthropic commitments, etc. to your profile.”
But don’t try to fake it on Glassdoor. “Pressuring reps to be team players and leave the faux-positive reviews is bad business. On more than one occasion, I’ve seen unhappy reps, shortly after departure, update their previous reviews with “My boss made me write that previous review; here’s the truth.” That casts a pall over every other glowing review. Just don’t do it. I recommend a three step process for your company on Glassdoor: Encourage, respond, and address. Step one, encourage your current team to post reviews. Let them know you want them to have the best-of-the-best colleagues and that reviews on Glassdoor are one way to show what a great company you’re building together.”
Use a survey to narrow down candidates. “Here’s how it works in practice. When candidates submit a resume, prompt them to take a five-minute survey. There are several immediate benefits. First, the candidates prove they’re interested by investing an additional five minutes. There are plenty of resume blasters out there — reps who apply for any position with a pulse. They are unlikely to begin and even less likely to finish your survey. We’ve just eliminated them in one fell swoop. Here are a few sample questions to give you a feel for what this might look like…
Which of our products interest you most? Why?
Which two of the following do you consider our closest competitors? (Pick list: include three competitors and three non-competitors)
In what year was our company founded? (List with incorrect options)
If you only had thirty seconds, how would you explain what we do to someone you met in an airport or coffee shop?
Phone interviews are key for SDRs. When it comes to hiring SDRs, phone interviews are as (if not more) important than in-person. Your reps will be making their living on the phones. They need to be articulate and able to make a connection without being face to face. These are the first two questions you should ask: What do you know about our company? What do you know about me personally?
Ask about real stories. Behavioral questions ask candidates to share specific examples of how they’ve performed in past situations. Ziprecruiter’s Kevin Gaither, who earlier shared his approach for sending LinkedIn messages to candidates, commented, “too many managers ask questions about how someone would handle something. To me, that’s just a BS way of trying to get at the answer, because how they would respond is not nearly as important as how they have responded in the past. I’m not looking for textbook answers. I’m looking for real stories.” So many candidates are asked the same exact questions in the interview process that their responses are rehearsed.
Let candidates meet current SDRs. “Because you have the candidate onsite, I highly recommend you give him or her an opportunity to sit with a current rep to see the job firsthand and ask candid questions. What is it really like here? What is the worst part of the job? How many reps are making quota? How much training do you really get?”
Be fast and deliberate when hiring. “Take a look at some of the most highly rated employers on Glassdoor, and you’ll notice a common thread: Their interview processes are lean. Many run from soup to nuts in just two weeks. If you want your perfect candidate to choose you, you need to move quickly. Here’s my (admittedly aggressive) timeline.
Resume & survey received — Day 1
Phone screen — Day 2
Phone interview — Day 4
On-site interview and shadow — Day 5–8
Extend Offer — Day 10
That’s ten business days from application to offer. Personally, I prefer the offer to come from either the CEO or the VP sales — As high as you can go. This is a final opportunity to make the candidate feel special. Just like with job descriptions, add some personality and sizzle to the offer letter.”
SDR’s take 3+ months to ramp. “It takes approximately three to four months to ramp a new SDR to full productivity. I also know — from that same research — that average tenure is between twelve and eighteen months. Also, in many markets — Austin, Boston, the San Francisco Bay area — you can expect to cut that number in half. There are just too many companies willing to take reps with six to twelve months’ experience and give them a shot at a closing role.”
Productive time is short. “Productive time in the role is just simple math: Tenure minus ramp time. On average, that’s just eight to fourteen months.”
The life of an SDR is short. “Two thirds of first-time SDRs are being promoted up or otherwise moving out of the role within 18 months.”
Hire in classes. “The massive efficiency gains from hiring two or more reps simultaneously vastly outweigh the boldness of the proposition. Training for one single rep tends to be informal, ad hoc, and (too often) sloppy, but training a “class” demands more attention and quality preparation. New Hires Bond Together: A class mentality leads to peer-to-peer coaching, better brainstorming, and a healthy competitive spirit. The big benefit is that new reps don’t feel like they’re alone. If you’re launching a sales development group from scratch, you absolutely want to hire as a class. I suggest you budget for an initial headcount of at least three reps.”
Characteristics. “Hire and promote first on the basis of integrity; second, motivation; third, capacity; fourth, understanding; fifth, knowledge; and last and least, experience. Without integrity, motivation is dangerous; Without motivation, capacity is impotent; without capacity, understanding is limited; Without understanding, knowledge is meaningless; without knowledge, experience is blind. Experience is easy to provide and quickly put to good use by people with all the other qualities.”
Job descriptions. “Most of us were taught that a job description should, well, describe the job. But that’s totally backwards. A job description should sell the job. Your job description should be an amazing piece of content that you’ll use to attract the best talent. In a highly competitive market, you’ll be selling the sizzle, while every other hiring manager will be documenting the chemical makeup of the task. EXAMPLE: Zenefits is the fastest-growing SAAS company ever. The founders managed to hit on a great idea at just the right time, and now they’re reaping the rewards. Two years ago, we had six employees and zero customers. Only a year later, the company hired 212 employees and signed over 2000 customers. EXAMPLE: We’re looking for recent college grads that want to jump-start their career through enterprise sales and business development. Did you know that 40 percent of S&P 500 CEOs come from sales and marketing backgrounds? Previous sales experience in technology doesn’t hurt, but it isn’t a requirement (the majority of our team came directly from the dorm to our office! The line “40 percent of S&P 500 CEOs come from sales and marketing background” is killer. More often that not, when people graduate from college, they don’t run out the door waving their diplomas and hollering, “give me a list, give me a phone, I’m ready to hammer out some dials!
To be successful, you are going to need to get in front of these reps and pitch them in the proposition that the best path toward their end game (a closing role, founding a company, marketing, leadership, etc.) is by joining you for a fantastic learning and growth experience.”
SDR Comp. “The average base is $46k and on target earnings are $72k. The core plan has no more than two moving pieces, and the nuances can be bulleted out on a cocktail napkin. If it takes PowerPoint and a cross-country plane ride to explain it to the rep, the plan is broken. I don’t believe that reps should be rewarded or penalized for the skills/actions of others. This includes tying a large portion of incentive compensation to won business. SDRs can’t choose their partnered account executives. Nor do they participate in the opportunity process. A large share of their income shouldn’t be dependent on factors outside their control. Base salary should be roughly 60–70 percent of total compensation for sales development reps. Also, whenever possible, pay incentive compensation monthly. These SDRs aren’t your angel investors. Don’t make them wait for a payday.”
Paying for meetings. “For groups setting introductory meetings, you should pay them on meetings held. It follows that a rep’s job is twofold. One, schedule the meeting. And two, make sure the meeting is held. Whether or not the meeting advances to the next step in the sales process is in the account executive’s hands.”
Don’t pay for closed deals. “For groups generating qualified opportunities, there is a strong impulse to equate quality with closed business. This often translates to paying the bulk of incentive compensation for closed deals that were sourced by the SDR. From a management perspective, this is couched in terms of “driving alignment with the business”. From a rep perspective, they will often refer to it as “screwing me for things outside my control.” It is my firm belief that you shouldn’t tie more than 20 percent of incentive compensation to “opportunities won”
The CEO should message candidates. “Think back to all those boilerplate recruiter messages flying around on LinkedIn. Beyond being nearly identical, they all tend to make one more fatal error. They try to sell the role, not a conversation. “If you are interested, please email me your resume” will nearly always turn off a passive candidate.” Also, message directly: “How would you react if the CEO, the SVP of sales, or another senior hiring manager messaged you directly? Don’t you think that would have a bigger impact on you? Everyone, even those early in their careers, expects to get hit up by recruiters on LinkedIn”
Set expectations. “We may tell a candidate the story about the person who got promoted in six months, but we tell them that they could just as well expect to spend two years in the role. Doing a good job of setting expectations upfront prevents disconnects and the inevitable disappointments.”
Use micro-promotions. “Have the flexibility to build steps within roles. You might hire a junior SDR, promote to associate SDR, and then elevate to senior SDR. I call these in-role advancements micro-promotions. Micro-promotions should be built on a five- to nine-month cadence. Micro-promotions have to be earned. During the recruiting process, share the progression path with you candidates. Get it out on the table early.”
Going from SDR to AE is big. “The jump in skillset from the SDR role (prospecting and qualifying) to an AE role (challenging and closing) is significant. Very few can seamlessly make the leap. The micro-promotions we detailed above are a way to bridge the gap. Adding small amounts of incremental responsibility along the path can be a great way to vet an SDR’s desire and abilities. You could have SDRs work on larger accounts, call higher into target organizations, or perhaps participate in demos or sales calls for the opportunities they generate. The important thing is that they have the sense they are learning new skills and are upwardly mobile. Also, be sure to communicate that this isn’t a one-and-done process. You might find that excellent AEs come from SDRs who took two or three attempts to demonstrate their readiness.”
Shorter sales cycle helps. “If you’re selling lower-dollar-value deals with shorter sales cycles, your SDRs will likely be ready for promotion sooner. I’ve seen successful SDR-to-AE promotion periods range from nine to sixteen months. For companies with more complex sales, eighteen to twenty-four months isn’t uncommon (with micro-promotions built in along the way).”
Promote only if you would hire. “The moral of the story: promote only those you would hire. Put your SDRs through the same hiring and evaluation process you would for external candidates. No one benefits — not you, your company, sales leadership, or the SDRs themselves — When a promotion sets reps up to fail.”
The phone is where it starts. “The key thing for leaders to remember is to get new reps on the phones ASAP. I’m not sure that there is a magic number, but I know that reps need hundreds of live connects before they are truly ramped. The faster they get there, the better. It is my personal belief that reps should be on the phone making dials by the end of their first week.”
6+ attempts. “Reps are giving up too quickly. Studies have found that it takes between six and ten attempts (including at least four by phone calls) to properly prospect a given contact. Consider the following from insidesales.com. The absolute bare minimum number of attempts to contact at least 50 percent of your leads is 6. The average rep’s performance? Between 1.7 and 2.1. In addition to executing a multi-touch cadence, reps need to vary the media they use. This should include the following: Voicemail, Email, Other (ghosting, texting, social media). Ghosting is calling a prospect, hoping to catch them live, and not leaving a voicemail. One voicemail and email are equally important. Two, voicemail and email together are twice as impactful as all the rest combined”
Get this book. Reach out to Trish and her company. She can jump start your SDR/BDR program.
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