Your Comprehensive 8-Step Guide to Sales Prospecting
In the 1850s, "prospecting" meant searching for nuggets of gold buried underneath piles of dirt. While the tools and goals of modern sales prospecting are very different from those of the Gold Rush, the basic concept is remarkably similar. Sales reps go to great lengths to find that "diamond in the rough" who could become a loyal, high-value customer for years to come.
Of course, there's a right and wrong way to handle sales prospecting. In this 8-step guide to sales prospecting, we'll discuss how you can make your time spent prospecting practical, effective, and successful - and ultimately "strike gold" by acquiring new customers!
Step 1: Define your target audience
First and foremost, you need to determine which type of customers are "gold" for your company - in other words, which prospects would offer the highest ROI for your efforts.
For example, what if you run a local business that only serves a specific geographical region? If so, you should only pursue prospects who live within a certain mile radius of your home base. What if you sell a product geared towards seniors? You wouldn't want to spend the bulk of your marketing efforts on younger demographics.
The point is, you need to understand who could benefit from your product or service, who would be interested in it, and who could pay for it. Once you know these (and related) factors, you'll be able to focus your efforts where they'll do the most good.
Step 2: Qualify your leads with data
As you compile your list of potentially interested prospects, it's important to qualify each person (or each account) based on your "ideal customer profile" (ICP), which should contain the criteria mentioned in step #1. You'll want to make sure that a prospect is well-qualified before making the initial contact with them; otherwise, you may end up wasting both yours and the prospect's time.
Here are some examples of qualification questions you may want to ask:
- Does this prospect live in our target market?
- Does the size of their organization match the criteria in our ICP (for B2B prospecting)?
- Are they currently using a product from one of our competitors?
- Are they a good fit for using our product or service? If so, why?
Of course, to answer these questions you may have to dig into whatever information is available about the targeted account. If the prospect has demonstrated a measure of interest in your product, then they may have already provided you with some helpful data. Otherwise, you'll have to perform research on their website, along with other reputable sources, to determine their fit for your product. While there will almost always be gaps in your data, this is an important step in weeding out low-upside prospects from the ones with a lot of potential.
Step 3: Prioritize with account scoring
Once you have a list of the prospects that could be a good fit for your business, it's time to prioritize which ones should be contacted first, and which ones should be pursued most diligently. This is where account scoring (aka, B2B lead scoring) comes into the picture. Basically, account scoring gives a numerical value to each prospect based on how likely they are to become a paying customer.
Obviously, how you score your prospects will depend to a large extent on your business' current sales process, and which types of customers are most desirable for your company. Here's one example of how account scoring could work:
- You assign a percentage value to each "qualification dimension" you uncover during steps #1 and 2, based on how crucial it is to the overall sales process. For instance, you could assign "Proximity" a value of 20%, "Organization Size" a value of 25%, and "Social Media Presence" a value of 5%.
- Next, you give each dimension a score, from 1 to 100. The higher the score, the more closely the account meets your ideal customer profile for that dimension. (Let's say you give Account A a "Proximity" score of 50, an "Organization Size" score of 70, and a "Social Media Presence" score of 10.)
- Finally, you multiply each dimension's score by its percentage "weight" and add up the numbers to get your total score. (For Account A, mentioned above, the total score would come out to 28.)
When it's all said and done, you should have a list of prospects that can be prioritized based on your account scoring model, from the highest scores (best fit) to the lowest.
Step 4: Keep an eye on "buying signals"
Even after you've identified qualified prospects and prioritized them based on account scoring, your pre-contact work isn't done yet. The reality is, contacting leads who aren't ready to buy yet - even those leads that would be a perfect fit for your product - is usually a recipe for disaster. It's not enough to know whom to target; you also need to know when to reach out to them.
That's why it's crucial to monitor "buying signals" from your prospects - i.e., any action that a prospect takes which could indicate readiness to purchase. Some common buying signals may include:
- Spending a lot of time on your website, and especially on a particular product's web page
- Signing up for your newsletter
- Downloading a piece of content, such as a white paper or eBook
- Reaching out to one of your sales reps via phone, email, or chat
It's critical to "strike while the iron's hot" in sales - and keeping a close eye on which prospects are sending out these buying signals will help you to know where to strike next!
Step 5: Identify the prospect's key decision-maker
In B2B prospecting, it can be difficult to find out exactly whom you need to contact within the target organization. After all, a lower-level manager might be enthusiastic about your product, but they may not have the authority to pull the trigger on a final purchase decision.
Here are some tips that can help you identify the person you need to talk to more quickly and efficiently:
- If you're pursuing an inbound lead, reaching out to the person who initiated the contact with you is a good starting point
- If you have experience in dealing with similarly-structured organizations in the past, consider which role in the target organization corresponds with the key decision-maker's role in previous interactions
- Think about who's most likely to champion your product, and who would be able to authorize the purchase based on your product's price tag
- Use tools like LinkedIn's Sales Navigator extension to find the contact details for your key decision-maker
Step 6: Make first contact
This is perhaps the most nerve-wracking part of the entire prospecting process - but it has to be done! The good news is, if you've properly qualified and prioritized your prospects ahead of time, then you'll be in a much better position to enjoy success during this initial conversation.
Keep in mind that unless your product has a low price point, you probably shouldn't try to close the sale on the first interaction with the prospect. Instead, you want to establish yourself as a helpful advisor, and your product as a potential solution to their problem. Remember to keep the conversation professional but personable, and try to build a rapport with the prospect. At this point, your goal may be to form a relationship first and "talk shop" later.
Step 7: Demonstrate value in your relationship
Once you've established a relationship with your prospect, it's essential that you demonstrate the value that your business can bring to the table. This doesn't mean trying to push your product onto a reluctant customer - quite the contrary! You want to approach your relationship with the prospect as a partnership, where their success is your success.
With that in mind, you would steer them away from products and services you offer that don't really align with their business needs, and highlight those offerings that would have the most beneficial impact on their company.
At the same time, you may need to address objections or concerns that the prospect has about your product, and look for that "win-win" scenario that you both want. For example, if the prospect is unhappy about the price tag attached to your product, you could ask them questions such as:
- How did you come to the conclusion that this product is beyond your price range?
- Would we be able to reduce the price to an acceptable level by removing product features that you don't really need?
- Have you considered [insert strategy here] as a way to fit our product into your budget?
Step 8: Analyze, refine, and repeat
After your first interaction with the prospect, odds are you haven't closed on the sale just yet. However, you've likely learned a lot more about their goals, their challenges, and the needs they're trying to fill - and you can use that knowledge to inform your next conversation with them. And if nothing else, you've gained valuable experience that will help you to be more convincing in your calls with other prospects in the same industry.
In summary, prospecting takes a lot of hard work and perseverance; but if you stay the course, you're almost certain to "strike gold" sooner or later. And if you need some expert assistance in adding qualified leads to your pipeline, reach out to our team of friendly professionals at Leadium today to start the conversation.
it's important to qualify each person (or each account) based on your 'ideal customer profile' (ICP), which should contain the criteria mentioned in step #1"