Retaining Sales Reps: Tips To Reduce Sales Turnover
The high turnover rate of inside sales reps is one of the biggest challenges facing the rapidly growing industry. Just when a salesperson becomes effective, he is ready to move on.
CEO and founder of XANT, Dave Elkington, addressed the importance of retaining reps and gave some tips on retention best practices in his presentation, “Profiling for Profit,” at the Inside Sales Virtual Summit.
Elkington’s presentation is embedded below:
Three Categories of Sales Reps
Elkington says there are three categories of inside sales reps that are generally recognized throughout the industry: appointment setters, closers and account management personnel.
Importance of Retaining Appointment Setters
Appointment setters are people who specialize in sourcing opportunities and appointments for closers. Every month an appointment setter is with a company, he increases his production by 40 percent up until the sixth month.
While it seems like a model can be built around that, appointment setting is a tough job. These employees can burn out easily, especially if the compensation and motivation isn’t right.
XANT found that a lot of companies, itself included, use appointment setter jobs as a feeder pool for other sales jobs. They tell these employees that if they stay in that position for six months, they can move into a sales closer job. What they may not realize is that by doing this they are eliminating a resource that is just becoming productive.
The lesson here is to create incentive, opportunity and an upside for appointment setters to stay another 6-12 months because those are the months they are really valuable. Not only are they going to increase production, but the size of opportunities they are going to be able to source is going to increase at a similar rate.
“This is a double whammy. If you are losing guys in that first six months, you are shooting yourself in the foot in quantity, quality and opportunity. You’ve got to figure out how to retain these people and incentivise them to want to be in this position for at least another 6-12 months or potentially indefinitely,” Elkington said.
The Value of Long-Term Closers
There is an even bigger cliff with closers. This second category of inside sales reps sources revenue. XANT found that for every additional year closers work for a company, they increase the size of their deals by 30 percent.
The problem is that as they are closing more and earning more money, they are becoming more expensive and even overly confident. Consequently, closers are very transitory. They work for a company for two or three years and then are on to their next gig.
According to Elkington, companies need to create an environment where the people who have been with the company a long time are earning a lot of money because chances are they are producing more than the other reps.
“These employees have earned it and are going to continue to earn it,” he said. “You can afford a 30 percent increase every year because you know that’s what they are going to source.”
Hiring the Right People For the Right Position
Possibly the biggest key to retaining salespeople is hiring the right people and putting them in the right position. This can be done through a process Elkington calls the hiring pipeline. Click here for the article on the hiring pipeline, which explains how to improve the hiring process and how personality assessments can help you place reps in a position they can thrive.
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- Xant Team