Cold Calling tips on getting business

For most business owners cold calling is a hideous proposition.  No one wants to call someone whom they don’t know, out of the blue, and try to sell them something.  Still there’s a nagging voice in the back of your head that says you should try it.

Vernalis Systems heard that voice.  The guys at Vernalis Systems custom build software applications, an industry not known for gregarious, salesman types.  Yet they found it within themselves to plunge forward and have developed a successful cold calling system.

Their problem was familiar to everyone in a service business - their only source of new projects was from existing customers and word of mouth.  They had a few large clients like Ernst & Young, Bank of New York Brokerage, Citibank and Major League Baseball with the risk was that if they lost one of them, they’d be in major league trouble.

To broaden their horizons they considered approaches like emails and Internet search results, but found both to be too passive.  Emails are too easy to delete and when potential customers are looking for custom-made software, they’re not likely do it through a Google search.  Yet Vernalis Systems management was convinced that potential clients were having an equally hard time locating competent software development partners.  Cold calling looked like the way to go.

Step one was to create software for tracking their progress, something that would let the cold callers, or hunters as they came to be known, know who needed to be called when and where in the process they were with each potential customer.

The next step was to buy a list from Dunn & Bradstreet containing every potential customer that fit their set of criteria determined by industry, location and company size.  For $450 they got the contact names and numbers of tens of thousands of prospects.

Then came the hard part.  Their three hunters, whom they found in their own ranks, started making 400 calls per week.  Those calls consume 100 work hours, because there’s more to it than just the time of the call, it’s also reviewing where they are in the process with each customer and documenting the result of the call.

They found that the best times to call are from 9:30 to 11 in the morning and from 2 to 3 in the afternoon.  They never leave voicemail; if someone isn’t there they make a note to call that person back later.  Of those 400 calls they can actually get about 350 people on the phone, a surprisingly large number.  Of those, 3 to 4 are considered good leads and a one percent success rate in this sort of endeavor is considered a success.

These conversations yield three results.  The first is that the potential customer is interested, but doesn’t need any custom software at the moment.  In this case, Vernalis Systems sends along some information.  The second possibility is that there is no work at the moment, but there may be soon so call back later.  The third, and best, result is that the customer has an immediate need. 

When this happens, the customer is seamlessly passed from a hunter to one of the five project managers, who are known as farmers.  The farmers see the job through to completion.  When the job is done, the customer becomes a satisfied one who will return with more projects and recommend Vernalis Systems to others.

Vernalis Systems still gets 90% of their business from repeat customers and referrals, but they depend on cold calling to expand their horizons.  

And what about their initial hesitation, that they would get a hung up on by irritated people who would vow never to give them any work ever. It never happened.