Do You Know the Difference Between Inside and Outside Sales?

The conversion around remote and onsite jobs has been a topic of discussion ever since the pandemic. 

While according to the employees, the flexibility of working from home has been pointed out to improve productivity, many managers question the effectiveness of remote work. 

Stanford University conducted a study on The Evolution Of Working From Home pointing out that working from home rose five-fold from 2019 to 2023. The study shows that fully remote work can generate even larger cost reductions from space savings and global hiring, making it a popular option for firms.

On the hind side, fully remote work is also associated with about 10% lower productivity than fully in-person work. In addition to the challenges of communicating remotely, barriers to mentoring, building culture, and issues with self-motivation appear to be factors.

With a lot of pros and cons on both sides, what would be an ideal option for sales? 

In this article we will explore inside and outside sales, understanding the benefit of both these approaches and the differences between the two to eventually decide which suits your business the best. 

So scroll down for further reading. 

What is Inside Sales vs Outside Sales

Inside sales refers to selling remotely through the use of digital devices and tools. This means that sales reps sit in the comfort of their home or office and contact clients through phone calls, emails, LinkedIn messages, or social media platforms. 

Outside sales require sales reps to go out to meet their potential clients for face-to-face conversation. They network through conferences, and seminars to build connections and relationships. Through these in-person field efforts, they make sales and close deals.  

Benefits of Inside Sales

Working remotely has been proven to increase productivity. Many consider remote work to be more productive with 63% of women and 55% of men saying they are productive working from home. 

So what are the benefits of remote work in sales? Let's look into the benefits of inside sales examples. 

• Cost-effective sales

Inside sales only requires sales reps with a laptop to do the selling. It saves the time, effort, and expense of traveling to reach out to prospects. Inside selling creates a work environment where the sales rep in the comfort of their home or office can contact multiple prospects across the globe. Additionally, implementing effective sales incentive programs can further motivate and drive inside sales teams to excel.

• Efficient selling practices

Inside selling makes use of multiple platforms to contact their prospects. Phone calls, text messages, email, and LinkedIn are some of the most commonly used methods. Reaching out through multiple channels enhances the chances of conversion as well as personalizes the customer approach. To further motivate inside sales reps, consider incorporating effective sales compensation plan examples that reward successful engagement through these various communication channels.

• Wider Prospect Reach 

With just a few clicks a sales rep sitting in a remote village in India can sell their products/ services to a client in a big city like New York. This is the opportunity that inside selling opens to sales reps and companies. A wider customer base will help companies to diversify their income and secure their sources of income. 

Inside selling will prove a better option with more people preferring work-from-home jobs and statistics showing the increased productivity of remote work. Moreover, implementing SPIF programs can incentivize inside sales teams to exceed their targets in this evolving work landscape.

Benefits of Outside Sales

Conversely, the traditional approach of meeting prospects face to face also offers many benefits. Some of these include: 

• Relationship building 

A large group of people still prefer the in-person way of relationship building. This approach is more effective and influential in successfully converting prospects into closing deals. Knowing the person, their body language, way of speaking, and the way they present themselves, their product, and the company to the client is decisive in a sale. Additionally, having a well-structured sales commission structure can motivate in-person sales representatives to excel and build those crucial relationships effectively.

• Efficient problem solving

Selling a product/service is bound to receive rejections from a prospect. While inside selling the client might cut the call, block the contact, and choose not to text back thus leading to a close in communication. But outside selling gives you the opportunity for a face-to-face conversation where such rejections can be negotiated and efficiently brought to a middle path. 

• Higher conversion rates

Outside sales have higher conversion rates than inside sales strategies. Outside selling begins with building strong relationships which further leads to a sale. This approach of building connections enhances the chances of conversion rates and moves the prospects faster through the pipeline. Furthermore, outside selling also ensures longer customer lifetime value.

Outside sales examples show that the benefits it provides can be advantageous to the growth of the organization.   

For further reading check Mastering Sales Promotion: Essential Personal Traits for Success.

What is the difference between inside and outside sales? 

We have already seen that the nature of selling and approaching the clients is different for inside and outside sales. This is just the tip of the iceberg. 

The difference in approach creates a big impact on various levels throughout the sales pipeline. So here are a few differences between inside and outside sales that impact the closing of deals.   

• Business Nature

Inside sales are more suitable for a B2B business. It helps sales reps to reach a wider audience within a shorter period of time cost-effectively. Outside sales are suitable for B2C business, as it's more effective in convincing the individual consumer and penetrating the market. 

• Sales cycle

Inside sales usually have a shorter sales cycle. This is because they deal with products with faster conversion rates and are easy to sell. Here the number of sales is more important than the size of the deal. The outside sale involves stages of building a relationship, selling the product, and then closing the deal. Moving through all these stages can take months and years. 

• Close rate

Inside sales is a cost-effective way of selling products and services. Sales reps will have a large number of contacts to generate leads and follow-up. If a prospect is showing less interest then they might move on to the next to close a deal. An outside lead puts time, effort, energy, and resources into building relationships and converting a prospect. This means that they will follow up until the deal is made. Hence, inside sales have a lesser closer rate and outside sales more. 

• Customer acquisition cost 

Inside sales use digital mediums to generate leads, contact them, and close the deal, leveraging various sales collateral examples. This means the cost involved is much less. An outside sale involves traveling, participating in networking events, and making new connections to close a deal. This means that the cost of customer acquisition is high.

• Scalability 

Inside sales are easier to maintain and scale. They work inside four walls and the cost of maintaining an inside sales team only requires providing the digital tools to start selling. An outside sales team is more efficient and skilled as they meet clients in person to make a sale. Providing the resources, meeting the traveling costs and other costs related to making connections to close deals makes the scalability of the team difficult.    

Inside and outside sales are very different in their way of working and the results they create. Hence, companies must be clear about their objectives before signing up for any two or both. 

For further reading check Boost Your Sales Journey Using These Resources.

Should you use inside or outside sales?

The advantages that field sales vs. inside sales provide are varied. Hence determining between the two must be based on the organizational structure and product nature. 

For example, inside selling best suits B2B vs B2C sales. Especially, while selling digital solutions B2B inside selling is more effective in increasing the customer reach cost effectively. While for B2C selling outside selling is more effective as an in-person approach will enhance the customer experience and make the conversion faster.

A combined strategy of using the inside and outside selling can also be effective. Inside sales strategy, leveraging the SaaS commission calculator, can be used to generate leads and qualify prospects, while outside selling can be applied to further the pipeline journey

Hence, a variety of factors come into play while determining the effectiveness of inside and outside selling and while determining which best suits your organizational operations.          

Conclusion

Field sales vs. inside sales is a question that organizations must decide on an introspective level. 

Whatever the mode of approach that you choose to sell, ensuring sales motivation, performance, and productivity is necessary. Sales reps working remotely or onsite need the required ambiance which ensures that they give the best of their potential for company growth. 

Incentive compensation, including the use of the incremental sales formula, is the most effective motivational tool companies must be keen on incorporating into their operations for improved productivity, enhanced performance, and optimized operations.

Kennect builds, runs, and automates your incentive compensation plans to create transparency and achieve operational efficiency. For more information BOOK A DEMO Today!