Inside Sales vs Outside Sales: Understanding the Difference

Until the emergence of sales technologies and tools, sales was mostly an outside-the-office practice (aka outside sales). Inside the office (aka inside sales), the sales team’s goal was to provide hot leads for on-the-ground agents to close. Inside sales and outside sales were two divisions in the sales process. Both roles are gradually merging with time, and the distinction between outside and inside sales is becoming increasingly blurred.

Inside sales professionals account for approximately 45.5% of the 5.7 million sales professionals in the United States. Outside sales account for 52.8% of total sales professionals.

In this article, we will help you understand the difference between the two based on several factors, the common issue that’s crucial to both, and which one is right for your business.

What is Inside Sales?

The process of selling to a consumer over the phone is known as inside sales. To reach new prospects, inside salespeople employ phone calls, emails, and other digital methods. Depending on the corporate structure, they may also receive inbound leads generated by marketing. If your business sells something that can be offered remotely, such as software, an inside sales team can provide many advantages.

What is Outside Sales?

When sales professionals visit with customers in person, this is known as outside sales. Outside sales representatives spend little time in the office. They have to travel to meet with clients in person. As a result, outside sales reps usually focus on highly valuable clients who can bring large contracts to the company.

Business Tactics

Outside sales have the upper hand on the range of business strategies used to captivate customers because they are generally conducted during face-to-face contact. Outside sales representatives are more strategic, engaging with C-level executives and establishing strategic business innovation to assist in growing their company. Whereas inside sales usually include a generic approach to attract more leads.

Presentations, demonstrations, and offering free trials are some of the techniques employed by outside sales professionals.

Inside sales professionals use webinars, social media, hosted CRM, screen shares, blogging, and paid ads.

Quality vs. Quantity: BOFU vs. TOFU

Quantity vs. quality might be compared to inside sales vs. outside sales.

Inside sales representatives operate from their desk. They work to fill the top of the funnel (TOFU) and have access to all the required sales tools. Many of their activities are automated. As a result, they can reach a large number of people every day. They also don’t have to worry about travel cutting into their available time, allowing them to utilize the maximum time in reaching as many prospects as possible. However, the conversion rate is quite low as the approach is widespread.

Outside sales focus on high-quality as they have to be on the field and invest more time and energy. They are approaching the bottom of the funnel, qualified leads. All their efforts are focused on generating revenue and closing deals. That’s why field reps like to meet with their clients in person to explain the intricacies of what they are offering and ensure that the possible customer comprehends them. Outside sales representatives may contact fewer customers, but they are more focused on quality with their approach.

Sales Cycles

The inside sales cycle is often shorter due to the lower chance of face-to-face interaction. However, because field representatives are focused on higher revenue, their cycles are typically longer and more complex. Outside salespeople are inevitably more likely to develop stronger and longer-lasting ties with their customers.

Outside sales may be demanding, with reps typically having to put in a lot of preparation time. For instance, selling technology to banks and other businesses requires outside reps to visit the business, understand their challenges, current infrastructure (with the help of the technical team), and ensure the client is satisfied with the setup. Although the sales cycles are shorter in inside sales than outside sales, the conversion rate is higher in outside sales.

Costs

As outside sales reps command higher base salaries, outside sales tend to be the more expensive of the two. They also travel frequently, which adds to incidental costs and may result in inefficiencies in the workplace.

On the other hand, inside sales reps use cost-effective technologies like web conferencing platforms, CRM databases, and analytics tools to lower acquisition costs.

Inside salespeople also have set working hours and schedules, which means they have a predictable monthly compensation. Field reps are frequently compensated on commission, making it difficult for the organization to forecast overheads and income.

Transactional vs Relational Sales

Now, before you think of dismissing your outside sales force because of the cost factor, keep in mind that they are the outcome of sales actions carried out in specific sales situations.

Certain sales models, such as transactional sales, lend themselves to an inside sales approach since they have low-value deals and short sales cycles. Having outside sellers on your team will benefit from a relational sales strategy with high-value deals (above $35,000) and protracted sales cycles.

Transactional Sales

• Without seeking to build a relationship, the seller wants to close a deal.
• There are only a few decision-makers (1 to 3).
• The sales cycle is short (90 days).
• Small-scale transactions (under $35,000).

Relational Sales

• Appropriate for businesses with a high number of employees (above 100).
• A strong working relationship with a big number of decision-makers (4+).
• Sales cycles that are longer than 90 days are considered slow.
• Deals worth more than $35,000.

Finally, you’ll always be at the mercy of your customer when deciding on a sales organizational structure. How would you like to be reached by your customers? How do they make it possible for you to conclude a deal? Is it possible to close a $1 million purchase over the phone? Only your customer matters while making that decision.

While one can easily determine the difference between the two, there’s one thing that plays a vital role for inside as well as outside sales professionals – Data.

Data Takes Center Stage for Both

We have seen some of the factors that differentiate inside and outside sales. But, the use of data is the key to success for both. Data helps inside and outside sales professionals to:

Prepare Before Approaching the Prospects: Both departments need contact and company data such as firmographic data, technographic data, and intent data before they approach the clients on and off the field.

Identify Potential Audience (Individual as well as Group): Both the departments need to find the potential audience to focus their outreach whether they are targeting a single company or an industry. They cannot approach prospects randomly. Intent data helps them to reach the potential ready-to-buy audience.

Personalize Their Messaging and Sales Pitch: Even if inside sales reps are approaching prospects using bulk emailing, personalization still holds the key. For outside sales reps, personalization is at the heart of their approach. Data can help their sales pitch by supporting their research with technographic and demographic data. Additionally, intent data lets the sales reps understand what type of content their prospects are consuming for a tailored approach.

Which One is Right for Your Business?

Inside and outside sales representatives are more alike than they are different, which is one of the most crucial things to remember. They’re all experienced salespeople with one purpose in mind: to sell.

Inside and outside sales are two distinct tools in your sales kit, and you should be employing both of them to ensure that you convert as many potential sales as possible.

In your organization, there shouldn’t be a black-and-white distinction between inside and outside sales. It’s a slider, and you’ll need to discover the right mix for your business.