It's really appearance setting, and it doesn't work.
Posted Apr 1, 2006
Companies that haven't had much luck with low-level lead generation programs often turn to appointment setting firms, because their very description implies traction and results. After all, firms that offer appointment setting often make their efforts sound like actual sales lead qualification with promises to get your representatives face-to-face with highly qualified prospects, putting you this close to closing the sale.
But do they really deliver on what they promise?
The answer is, yes and no. The term appointment setting is a misnomer, since what most of these firms do is merely schedule appearances and create the illusion that they're performing sales lead qualification. In reality, these appointments are usually no better than simple leads-companies may agree for your sales rep to show up, but many of the meetings won't turn out to be with bona fide prospects.
The most logical argument against appointment setting lies, curiously, at the heart of its selling proposition: Someone who agrees to see your sales representative is more qualified than another prospect that's simply been forwarded to your rep as a lead. Not true. In fact, anyone who agrees to see your rep for any amount of time without the preparatory conversations required for real sales lead qualification has more time to waste than most senior-level executives, and may not be the right person to talk to in the first place.
Over many years of executing successful business prospect outsourcing programs, I've provided clients with sales lead qualification services that help improve their sales performance. I've learned that appointment setting rarely works, and for the following reasons:
1. Appointment setting increases costs without corresponding benefit. On the basis of "guaranteed appointments," companies send their sales forces out on expensive appearances across town or across country, where sales lead qualification has not been done. This is a huge cost for business opportunities that generally don't pan out. To illustrate the point, a former sales executive of a large software company that used appointment setting services reported to me that as many as three out of five of those appointments offered no real opportunity. Additionally, at least 20 percent of the so-called prospects didn't even remember scheduling the appointment. This is the experience of one organization, but it speaks to the universal problem of appointment setting: lack of sales lead qualification.
2. Appointment setting is the right sales step, but at the wrong time in the process. Most of my clients sell complex, relatively expensive solutions requiring the involvement of multiple decision-makers and multiple levels of evaluation. A costly appearance with one person, without advanced discovery, is not the most efficient first step with a new prospect in that situation.
3. Appointment setting forces your sales people into a cold call situation. Understandably, sales reps prefer to know something about the people they're selling to and to present in a warm environment, rather than making a cold call. If correct sales lead qualification is done ahead of time, rep visits are like discussions with a trusted advisor or new friend. Conversely, if the sales rep has to go in cold, all the focus is on the presentation. Worse, the audience is unfamiliar with the message and may be naturally distrustful or even argumentative. How many of your field sales people are great cold call presenters?
4. Appointment setting is not the best representation. Pick up the classifieds section of any newspaper and you'll find dozens of ads for appointment setters, usually headlined as follows:
"Earn up to $2,500 per week setting appointments."
"Earn money setting appointments, no cold calling."
"Earn $100,000 per year part-time, no experience necessary!"
You have to ask yourself whether these are the types of people you want engaging your market for the first time. If you never get a second chance to make a first impression, do you want that impression to be made by someone who responds to one of the headlines listed above? No. Instead, you'll want to work with professionals with deep expertise in high-end sales lead qualification.
If it sounds too good to be true, it probably is.
Appointment-setting firms appear to offer a shortcut, the truth is they offer about the same value as low-level leads culled from trade shows or mass-market campaigns, neither of which incorporates actual sales lead qualification. Putting a good salesperson in front of a bad prospect won't yield cost-effective revenue, and appointment setters aren't focused on finding the best prospects. They just want to get your sales reps as many appointments as possible.
It's clear why appointment setting seems attractive, but it leaves out the essential step of sales lead qualification, which is necessary to ensure that sales reps are talking to the right person, and that the right person is knowledgeable and engaged before the first meeting ever takes place. By shifting to programs that more accurately qualify ready buyers and work to establish an ongoing dialog, companies can begin to see increased sales.
About the Author
Dan McDade is founder and president of business prospect outsourcer PointClear. He served as vice president of marketing for the direct mail firm Jackson & Perkins before he founded PointClear, and as president of UST: The Business Marketing Group. Please visit www.pointclear.com
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