While inside sales focus on selling goods and services remotely, outside sales involve meeting with clients in person.
Even though inside and outside sales serve different purposes, many people are still confused about which is better.
In fact, ‘inside vs outside sales’ has become a commonly searched term since sales reps are often confused about the activities included under each sales model.
So, which one is better among inside and outside sales?
How do you determine which model would work best for your organization?
In this guide, we’ll break down:
- Every aspect of inside vs outside sales
- Their advantages and costs involved
- How to structure your sales teams for inside and outside sales
- The different tools used for inside and outside sales
What Are Inside Sales?
Inside sales is the process of selling products and services to customers remotely. That’s why it is often referred to as remote sales.
It enables sales processes through the use of tools such as phone, email, VoIP, social media, and other digital communication tools to inform consumers about a company’s products and generate revenue.
In general, the key responsibilities of an inside sales rep include demonstrating superior product knowledge to resolve customers’ queries and concerns.
It also involves, but is not limited to, nurturing leads for conversions, managing referrals from existing clients, and building relationships with potential clients to create trust and rapport.
Inside sales are commonly used by B2B companies, particularly those that specialize in SaaS and tech products.
Typically, sales reps use a CRM platform combined with outbound tools to make sales. Since inside sales are conducted remotely, salespersons are expected to have excellent communication skills.
They need to sell a product or service without in-person interactions with customers as well as address any queries that they may have.
Advantages of Inside Sales
Let’s understand the benefits of inside sales in detail.
#1. Reduce costs
Unlike outside sales, where you often require to travel to visit clients, inside sales reps can simply sit in their office and dial a number.
It not only saves them time on the commute but costs too.
Research conducted by Mike Moorman of ZS Associates showed that inside sales reduced sales costs by 40-90% compared to outside sales tactics.
#2. Spend more time on selling
Inside sales reps spend more time selling than outside sales reps as they don’t require visiting clients in person.
A study has shown that inside sales teams spend nearly 35% of their week selling, while outside sales reps spend only 22% of their week doing the same.
Since inside sales reps don’t need to travel, they can invest more time prospecting, generating leads, and following up with them more often.
#3. Quicker response time to leads
Lead response time is crucial to create a seamless customer experience.
When you respond to your leads in five minutes, it is 100x more likely to connect with a lead than businesses that take over an hour.
The graph below gives us a clear picture of the initial response time of companies.
Since inside sales involve using digital communication tools, reps can respond to leads faster.
Rather than making in-person visits, inside sales reps only require email, phone calls, video chat, or social media handles to get in touch with their customers.
#4. Easier to scale the team
Scaling up your outside sales team can be a long and complex process.
You train your reps to travel to different places, make them meet clients, and give them a tour of the fieldwork.
This process requires a lot of training and resources and thus, gets costly.
With inside sales teams, however, scaling up becomes easier as reps often don’t need any location-specific expertise.
As long as they are familiar with digital communication tools and have strong communication skills, they can easily become a part of an inside sales team.
#5. Increased collaboration
Usually, outside sales models rely on a single person to manage the entire sales process.
But the inside sales team can be structured in such a way as to increase collaboration.
For instance, one sales rep can conduct onboarding calls and pass them on to the next rep for further communication.
Similarly, another team member can handle customer grievances and so on.
What Are Outside Sales?
Outside sales models involve getting out in the field and meeting with clients in person.
They need to travel to talk to customers, hence, they are mostly found off-site. At times, outside sales are also known as field sales.
Since outside sales reps typically deal with big and more expensive accounts, they are often referred to as a company’s ‘superstars.’
They should have the quality to work independently, be able to travel a lot, and demonstrate a high degree of emotional intelligence.
While a major portion of the sales job can be done from the office, thanks to online communication tools like Skype and Zoom, outside sales requires reps to be available in person whenever and wherever required.
This is why you often find field sales team members selling products at conferences, speaking engagements, and industry events.
Broadly speaking, a company needs an outside sales model in two scenarios.
Firstly, a company needs an outside sales model if the sales involve highly-expensive products and services. In such a case, it becomes necessary to talk to company executives or decision-makers. Thus, it involves outside sales reps who can close deals.
And secondly, if your company has launched a new product or service that requires face-to-face presentations, outside sales are a must.
Besides, for companies dealing in a niche product where people have no clue how to use it, it’s best to have an outside sales team that can demonstrate the usage of the product effectively.
Advantages of Outside Sales
Even though the process of outside sales moves slower compared to inside sales, they have their own advantages. Let us look at some of them.
#1. Helps develop stronger client relationships
No doubt inside sales model helps contact customers faster, but they are largely impersonal.
Thus, it takes an extra amount of effort to foster strong relationships with clients.
But in the case of outside sales where the sales reps are constantly meeting with their clients in person, it helps develop a long-lasting relationship with them.
Besides, outside sales reps usually focus on individual client accounts rather than focus on a specific role.
By working on individual accounts, sales reps are able to give complete attention to a customer and perform all the responsibilities, including lead nurturing, training and onboarding, informing about newly launched products, and addressing any questions and concerns.
Furthermore, sales reps can better tailor the sales process according to client needs in comparison to remote sales.
#2. Higher close ratio
Despite spending less time on sales, outside sales teams are reported to close more deals than inside sales reps.
A study by Salesloft revealed that outside sales convert prospects 40% more than inside sales teams do.
While this does not imply that outside sales are better than inside sales, it proves that the benefits of engaging with clients in person far outweigh its costs.
Face-to-face interaction with clients helps build better relationships and is more influential than emails or video calls.
Moreover, in-person meetings are more beneficial when managing complex sales processes that include several decision-makers.
#3. Commissions can be a motivating factor
Many outside sales teams operate on a commission-based model.
The more sales a rep gets, the more commission they earn.
This can become a motivating factor for your team and help them focus on getting more deals, which in turn, increases revenue for your business.
Inside vs Outside Sales: What Works Best?
There is often a debate on which is better between inside and outside sales.
In case you are confused as to which sales model to use, here’s the comparison to make the decision easy for you.
#1. Degree of product specialization
If your product is not niche and does not require a demonstration to understand how to use it, it is best to use an inside sales team.
For instance, if you are selling a self-service digital or tech product that is not complicated to use, you must opt for an inside sales team.
By contrast, if your company specializes in niche products and requires intense demonstration to understand its proper functionalities, an outside sales model works better.
#2. Cost and scalability
If you want to scale your sales team faster, go for an inside sales team.
Remote sales teams are easier to grow since they don’t involve training team members and traveling to different places.
All that is required is strong interpersonal skills and familiarity with digital communication tools.
But with outside sales reps, the company will have to offer rigorous field training. The new sales hires would be made to accompany their senior sales reps – familiarize them with the different regions, and train them to interact with customers and demonstrate product usage.
In essence, the training period cycle can be longer for outside sales, making it hard to scale the team faster.
Also, the cost of hiring an inside sales rep is less expensive compared to outside sales team members.
#3. Sales cycle
Another crucial factor that determines your need for inside and outside sales teams is the length and speed of your sales cycle.
If your sales reps can easily connect with their prospects and sell products online, an inside sales team works best. It is possible especially when dealing with a commonly used product that sells fast.
By contrast, if your product has a slower sales cycle lasting 90 days or more, go for an outside sales team.
Because they focus more on product demos, meeting with decision-makers, and other high-level interactions before making a sale.
#4. Nature of client relationships
A good way to determine whether you need an inside or an outside sales team is to understand your company’s goals.
If your company aims to reach out to more prospects in less time, building a remote sales team is better. Inside sales teams can reach out to hundreds of potential customers in a day via email, phone calls, or social media channels.
And if your primary focus is on nurturing and converting leads, an outside sales model works better.
With a field sales team, you can pay more attention to individual clients and personalize the sales process to their needs, helping you build stronger relationships with them.
How to Structure Your Inside and Outside Sales Teams
One major dilemma for companies is how to structure their sales team. This five-step guide will help you structure your inside vs outside sales teams.
#1. Identify what goals you want to accomplish
The first and foremost step to structuring your inside and outside sales team is to establish the goals you want to accomplish.
If you want to connect with prospects and clients using digital channels, it is time to scale your inside sales team.
But at certain times, nurturing and converting leads requires face-to-face conversations with current and potential clients.
For the same, you need to recruit field sales team reps, who can travel to multiple places and interact with your clients.
#2. Choose a compensation model
Decide whether you want to implement a commission-based model or a salary-based model.
Typically, outside sales reps work on a commission basis – the more leads they convert, the higher their commission.
On the other hand, remote sales reps usually work on a salary basis.
#3. Organize your team by specialization
To get the maximum benefit out of your sales teams, structure them according to specialization.
If someone is proficient with technology, they might be better suited for an inside sales team.
On the other hand, if a sales rep has excellent communication skills and a willingness to travel, they can become a part of the outside sales team.
#4. Train for effectiveness, not efficiency
While efficiency is a must for sales reps to achieve targets within a short period, it is equally important for them to be effective.
Effectiveness implies convincing customers to stay loyal to the company in the long run.
This is usually the job of outside sales reps since they spend a lot of time talking to clients and executives in person.
Hence, companies should emphasize training field sales team members in such a way that they not only acquire customers but also convince them to keep making purchases.
#5. Record calls of your sales reps
Since the role of inside sales reps largely involves making phone calls, recording them promotes a culture of active listening in your organization.
By reviewing sales calls, managers can discuss with sales reps how they can communicate better and provide valuable information on your product’s features that were not documented or explained to customers.
Different Tools Used by Inside vs Outside Sales Teams
Both inside and outside sales teams demand a different set of sales tools to carry out their activities.
Tools for inside sales teams
First, let’s take a look at the tools used by inside sales teams.
#1. CRM Software
Given that inside sales teams operate remotely, having knowledge of customer relationship management (CRM) tools is a must.
Having a sales CRM in place allows you to centralize all your customer interactions in one place, qualify leads, schedule regular follow-ups, and do much more.
EngageBay, an all-in-one CRM, offers a comprehensive set of solutions at affordable pricing to help your sales departments achieve their goals.
#2. Sales intelligence tools
Using sales intelligence tools, reps can find organizations that match their ideal buyer profile by scanning through millions of data searches.
These tools help companies understand their target audience better using real-time data signals such as buying signals, purchase history, business objectives, digital footprints, and so on.
#3. Call tracking software
Sales call tracking tools allow reps to send and receive calls from their desktop itself, and help them contact clients anywhere in the world.
The software records the conversations between the reps and the customers, schedules appointments, and builds email lists and notifications to share among team members.
#4. Virtual meeting tools
Since inside sales take place remotely, online meeting tools such as Zoom and Skype have become quite popular among sales reps.
They help with face-to-face interactions without having to meet with clients in person.
Using the tools, sales teams can demonstrate product features, onboard and train customers, and resolve their grievances.
Tools for outside sales teams
Now, on to the tools for outside sales teams. Notice how some tools overlap with the above category (think CRM).
#1. Sales mapping software
Outside sales reps often use sales mapping software as it helps them identify which leads they should meet.
Once they have decided on the prospects who are willing to talk to them, the sales mapping software creates an optimized route for them to reach faster.
#2. Mobile contract apps
Mobile contract apps are used for storing, creating, and signing documents.
They are useful for sales reps who are on the go since it helps refer to documents anytime, even when they are not in the office.
#3. CRM solutions
Outside sales reps require CRM software as well as it helps them schedule meetings, access a centralized customer database, forecast revenue, and track sales performance over a given time period.
#4. Calendar management tools
While CRM tools help sales reps schedule appointments, calendar management tools can also be used to fix meetings with clients.
Here, sales reps can keep tabs on scheduled meetings, canceled or postponed meetings, and any other events.
Inside vs outside sales have different strategies, and none is better than the other.
Both methods are effective and can be used together to increase sales.
While inside sales cost less, outside sales are more beneficial in nurturing client relationships. The best way to find out which tactic works for your company is by starting with a few reps for both inside and outside sales and calculating the ROI for each team.
This will help you understand which sales model works best for your business.