Why Cold Calling is Wrong for Startups

May 1, 2020, seven weeks into Shelter in Place in Silicon Valley. A client had just asked me to test a product concept with customers, so I picked up the phone to dial a list of their customers. This was not a “cold” list, it was senior executives at companies who had purchased the client’s products.

I dialed the first 46 phone numbers on the list. After working through the phone menus and leaving many voicemails, these were the results:

  • 1 conversation
  • 19 main switchboard numbers with no way to contact the individual
  • 4 wrong or disconnected numbers
  • 18 rang more than 10 rings
  • 4 hangups

That is the reality of cold calling today. Even if you believe I said something awful to cause the 4 hangups (I didn’t), the results show that cold calling is a low-productivity activity.

Some Experts Claim Cold Calling Still Works

Here is a sales consultant attempting to teach how to be successful with cold calling.

These are the five steps he lists for cold calling success:

  1. You have to know your ideal customer profile.
  2. Have a game plan – a sales strategy – for every scenario that you’re going to run into.
  3. Make sure you’re role-playing.
  4. Block out call-block times for first-time calls.
  5. Teach others when you start to have success.

Notice that none of those steps address the fact that people aren’t answering the phone. Here is what another consultant claims are 13 steps to cold calls that work:

Here are the 13 steps described in that video:

  1. Cold calling can’t hurt you.
  2. Make cold calling a game.
  3. Be willing to take risks.
  4. Warm it up as much as possible.
  5. Script out the entire call.
  6. Know your first seven seconds cold.
  7. The more you talk about you, the worse you do.
  8. Focus on the challenges you’re seeing.
  9. Engage them to start talking.
  10. Dig into what’s really going on.
  11. Get that next step locked in.
  12. Confirm the next step.
  13. Don’t run away from the phone after each call.

Once again, notice that none of the 13 steps address the fact that nobody answers the phone.

Organized Resistance

It turns out that, after many years of complaints, the telecom industry is taking steps to reduce the volume of spam and scam calls. This video has some details:

Your phone allows you to block callers who are not on your contact list. The telecom company displays messages like “Possible Spam” and “Scam Likely” on the display for many calls. While your number is probably not being blocked like this, these warning messages are making people more aware every day about the dangers of answering the phone.

Do You Start Trusted Business Relationships with Cold Callers?

At SalesDev.Global we ask this question during workshops and training classes: “Are you comfortable starting a trusted professional relationship with a cold caller?” It is very rare for anyone to say yes.

Larger companies that have long-term marketing campaigns often divide sales responsibilities between several roles:

  • BDRS (business development reps) handle inbound leads, inquiries that come in from a marketing campaign through telephone, email, social media, chat or other channels.
  • SDR (sales development reps) make outbound calls and send email. They may have a list of leads that came in, or they may start from scratch. Their goal is to contact prospects, qualify them and move them through the first steps of the sales process.
  • Account Executives take prospects that have been qualified by the SDRs and BDRs and work the later stages of the sales process to close business.

As a startup, you likely have no marketing campaigns, no SDRs or BDRs and no list. Given the experience described at the start of this article, do you believe your startup should initiate a cold calling campaign? The data suggests you might want to focus on other outbound sales activities.