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Five Questions to Determine If You Should Outsource Lead Generation

by Jenny Vance, President, LeadJen - December 31, 2014

5 questions to determine if you should outsource lead generation

Having a consistent flow of quality leads is the lifeblood of most organizations. When the recession hit, many organizations opted to outsource their lead generation efforts to cut down on overhead.

Now that the economy is improving, is it time to move lead generation back in-house?

Here are a few questions to ask that will help determine if outsourced or in-house lead generation is right for your organization.

1. Do I have the capacity to manage a team that requires a lot of oversight? Because of the high burn-out rate in inside sales, reps require a lot of recognition and clear metrics for achievement. This requires significant managerial oversight, in some cases as much as one hour of managerial oversight for every hour of sales rep time for new teams. While managers often consider financial rewards, managing a staff of inside sales reps also requires daily encouragement and recognition to keep reps motivated.

2. Do I have the right technology? High volume prospecting requires specialized technology to measure meaningful success metrics. This goes beyond measuring things like call attempts and calls logged. Lead generation managers need to categorize calls in a way that helps them understand which rep is having the most calling success and why, who’s the most effective and why, and how to help the team better replicate this success. The right technology also allows prospecting teams to test scripting strategies, as well as follow-up and cadence strategies, then compare results.

3. Can I support my team with good data? Successful prospecting campaigns begin with good data. In fact, campaigns based on clean data have a significantly higher return on investment. There are a few ways to get data: subscribe to a data resource, buy a list, custom-build a list or expect sales reps to research their own leads. If sales reps are responsible for their own data, productivity is likely to fall.

4. How will I know if we’re successful? It’s important to have clear expectations for success based on best practices. Do you know how to define success and what your expectations should be for sales reps? Do you have best practices for scripting, training and campaign processes in place? Without these best practices, the timeline for success becomes very long--as long as six months--as sales reps are hired and trained, progress is reviewed and mistakes are corrected.

5. Do I know the full cost to hire an inside sales rep? It’s easy to understand the hourly cost of outsourcing inside sales; however, the costs of an in-house sales rep include more than just a salary and benefits. Infrastructure costs, including technology, data, physical space, a phone and computer can add an additional 10 to 20 percent to the cost of in-house employees. Managerial time also has to be considered. In addition, there are “hidden” costs, including:

Ramp-up--The time it takes to build processes, establish benchmarks and ramp-up an inside sales team can be up to several months. In the meantime, opportunities and sales are lost.

Productivity attrition--this is the cost to the business of time spent not making calls. With internal meetings, office chit chat, internet surfing and other things, typical inside sales reps spend only about 60 percent of their time making calls.

Turnover--Most organizations can expect 80 percent turnover annually among inside sales reps. This means that your organization must incur the hefty cost of recruiting and training new employees, in addition to the cost of lost opportunities and sales. These costs can be 200 percent of the annual cost of an employee.

Finally, an outsourced lead generation partner can provide intrinsic value beyond best practices and proven processes. The right partner should be able to provide benchmarks of performance across other campaigns targeting similar industries, title paths or solutions, contributing insight about how your company compares to others.

Jenny Vance is president of LeadJen, a B2B lead generation company that uses unparalleled data and insight to drive prospect interactions that convert to sales. She can be reached at or on Twitter @jennyvanceindy.

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